(GATA) Barrick & Goldman Sachs = greatest asset rip off plays off all time?
Subj: Midas - Goldman Sachs, Ashanti, Veronica, Henri
Date: 1/11/00 8:25:58 PM EST
From: LePatron@LeMetropoleCafe.com
Le Metropole members,
Midas du Metropole has served commentary at
The James Joyce Table.
January 11, 2000
Another day, another.....
On that note, a fund bought at least 6,000 gold contracts today and
Goldman Sachs was by far the big seller to them. It's the same old song!
No surprise after the performance of the bond and oil markets? Can't
have gold rally too much with that scenario. Bring back the $2 rule.
Gees - this just gets so obvious I want to SCREAM!
Speaking of screaming - a colleague of mine and I never saw this one
before and not sure what to make of it on a day like today. Early this
morning, Dow Jones London put out a report..... exacerbate any rally.
... the strategy could help lift silver almost $1 to $6 a troy ounce."
For a bullish story like that to come out and have silver be so dull
was peculiar enough. Then, Dow Jones U.S. put out this midday during
the Comex session: "Goldman Sachs' J. Aron seen a buyer on Comex gold,
broker says. "Aron was doing some buying between $282.50 and $283,"
he added." We called the floor and found out that Goldman Sachs was
the big seller, so the gold flash by Dow Jones was bogus, wrong and
misleading. And, of course, silver did nothing all day in N.Y.
One has to wonder what is going on here. I repeat, my colleague and I
have never seen anything like this before. Two GS stories, the same day,
from one news service, in two continents. The price of silver cannot
rally a penny and the gold story is false.
Dow Jones (my colleague never saw them ever mention Goldman Sachs by
name before) won't just print stories like that unless they got it from
a reliable source. Very reliable. So who would do this and why????
My colleague and I are pondering this to try and determine if it might
mean something. My thinking is that both of these stories originate out
of the Goldman Sachs operation. Only way two could have come out like
this the same day and only surface on Dow Jones in two different
continents. The "Why" has to be determined.
The big story in silver recently was whether the Chinese were going to
dump silver onto the market.
The bottom line of this topsy turvy story is:
China Silver - Stockpile Sale Seen Not Imminent
SHANGHAI, Jan 10, 2000 -- (Reuters) China's central bank is likely to
give guidance to producers in their debuts on the international market,
but the disposal of its own stockpiled silver is not imminent, industry
sources said on Monday.
The international silver market was roiled last week by news that
China was about to sell some of its surplus silver after the market
was deregulated on January 1. End.
Want to see a very bearish looking chart - take a look at the bank stock
index (BKX). It closed today at around 713 and is close to making new lows.
Since October, it has tried to rally 5 times only to be turned back every
one of those times. That is real world business. It can't be long before
the general market wakes up and follows suit. That should precipitate
investment demand for gold as paper assets begin to disintegrate.
This email may interest you and shed some light on what is going on out
there. More anecdotal evidence of concerns of future deliverablility of
physical gold:
"Dear Bill,
Thought this might be of interest to you.
This is a Reuters story:
"Dutch bourse rejigs gold options, delists silver".
"The Amsterdam Exchange plans to launch new, revised gold options in
March and will de-list silver options. Gold options will change from
American to European style. In addition they will no longer be delivery
contracts but settled in cash.
Silver options were being de-listed due to lack of interest and very
small turnover. The last month of silver options to be traded on the
Amsterdam Exchange will be the Mof silver op
This is ridiculous. How can a commodity like gold just be settled in
cash? Either this just some new casino grand opening and/or the ECB's
decision to curb its gold sales is beginning to have its effect on
emptying warehouses. Either way, it is dangerous to get paper (at least
it's gold-backed Euros) delivery instead of the physical itself.
Kind Regards,
Edmond
Today's Reuters update and story on the intriguing and complicated
Ashanti story:
"Ashanti Goldfields, the troubled Ghanaian miner, has caved in to pressure
to sell half its Geita gold project in Tanzania, long seen as the key to
the company's future.
The move will please the government of Ghana, which holds a 20 per cent
stake in Ashanti. It has been advocating the sale of part of Geita to
ease the financial crisis at Ashanti. However, one analyst said the
planned disposal represented "selling the family gold".
The news came on Monday as Ashanti confirmed that a group of.....
The six shareholders...together account for 5.1 per cent of Ashanti's equity.
They are also seeking to restrain the board from selling parts of the
company or entering any agreement that could restrict a new board's
ability to deal with Ashanti's affairs. The legal action is said to have
the blessing of the Ghanaian government.
Ashanti said it would "vigorously defend" itself against the proceedings.....
The company said it had already started an auction to sell 50 per cent
of the Geita project, which analysts have valued at around $400m.
Barrick Gold, the Canadian group, is thought to be among the frontrunners
to acquire the holding. It is believed to have tabled an offer of about
$200m plus $140m working capital to help develop the mine.
Placer Dome, also of Canada, and AngloGold of South Africa are among the
other groups keen to buy into Geita. Lonmin, which holds 32 per cent of
Ashanti, is reported to be keen to participate in the auction.
Andy Pegge, at Laxey Investors, one of the shareholders backing the
legal action, said: "This action can only help. Shareholder value has
been undermined by either bad news or uncertainty. If we must go the
hard route then we will."
But Charles Kernot, mining analyst at Paribas, the investment bank,
said: "Geita is very much a prime asset with the potential to become
one of the world's great goldmines. It will be a mistake to sell part
of it."
[End.]
Bloomberg also had a story out today announcing the hiring of a new
Treasurer who is going to assist in reorganizing Ashanti's debt.
Their story made a point to announce the fact that the board is
"reviewing the company's gold hedging activities." Ashanti "plans
to incorporate all lessons learned from recent developments."
Will Barrick and Goldman Sachs be a part of one of the great asset
rip off plays off all time? This is crazy. First, lead advisor,
Goldman Sachs, consults Ashanti into a loser, then probably helps
engineer cooperating, big time hedger buddy, Barrick, to steal
A highly respected associate made the mistake of going to Ghana
... Can you imagine what is going on behind the scenes for one of
Africa's prized assets!
A thought from a fellow Cafe member:
Bill,
To fully understand the Ghanaian Chronicle article, it is necessary.....
The real question and issue for us gold players is whether Ashanti is
going to cover its massive forward sale and option positions. No one I
speak to really understands what the deal is on that. Of course, the end
result is mega news for us. Do they cover and move the gold price up or
stay with the bullion dealer, Barrick, stay short forever program? Big
difference - to clean a good part of the books buy back would have a very
positive effect on the near term price of gold.
I don't think it will surprise you that I don't like the smell of this
one. Bring back "Something is Rotten in the State of Denmark."
The XAU keeps bobbing along doing little of anything and.....
My GATA associate, Chris Powell, and I getting ready to fire off follow
up questions to the US Treasury and US Fed. They asked if we needed
clarifications to the answers to the questions we asked them and we
certainly do. For starters, we are submitting the 11 questions in our
RollCall open letter to Secretary Summers and Chairman Greenspan. They
encompass many of the loopholes that our questions of late summer left
open for ambiguous answers.
I would like to thank so may of you for your thoughtful responses.
I have attached some of them after the Midas for your perusal.
Henri's is very technical. If anyone has any particular insight into
his commentary, or how it might help us, give me a jingle.
The big financial story yesterday was the AOL/Time Warner deal.
Today, both stocks were hit hard. Maybe this will be the straw that
broke the camels back or the event that broke the stock market bubble.
Here is my reasoning. Tulipmania ended when a sailor.....
... the AOL/Time Warner merger, analysts now have to look at internet
company, AOL, like normal companies and give it a proper evaluation.
Either that, or rethink they way the are doing the analysis business
for companies like Time Warner.
Maybe AOL's bite of Time Warner will be the wake up call portfolio managers
and stock analysts need to see the madness in the tech/internet bubble!
For those of you that would like to read some feedback about our efforts
to get the truth out of the US Treasury and US Federal Reserve.
Hi Bill,
"Henri" here. I find the coordinated response in the Treasury letters
interesting as well; however, the omission of discussion of options,
while a glaring hole as you mentioned, does not seem as significant to
me as the "...in order to influence trading." qualifier. They do not say
they are not hedging the value of gold the govt has in order to protect
gold obligations or outstanding U.S. gold debt denominated at the
"official" gold price "payable in gold". Should the "official" price
of gold be unwound, or the gold debts called in due to a scare of
insufficient supply, the loss to the treasury might be significant.
In this regard, political influence on the "Federal Reserve Banks"
to sell down gold coulomission of diSo it would not be actually the
Federal Reserve Board, but instead the member Federal Reserve banks
who are the culprits.
Consider these excerpts from USC Title 31
Subtitle IV
Chapter 51
Subchapter 2
5115. United States currency notes
(a) The Secretary of the Treasury may issue United States currency
notes. The notes - (1) are payable to bearer; and
(2) shall be in a form and in denominations of at least one dollar
that the Secretary prescribes.
(b) The amount of United States currency notes outstanding and in
circulation -
(1) may not be more than $300,000,000; and
(2) may not be held or used for a reserve.
Note these are NOT federal reserve Notes. They are separate an distinct
financial instruments and issued by the Sec on behalf of Congress.
If these bearer notes have face values in US$ but are payable in gold,
then 300 million in 1913 gold price of X$ /oz could be a substantial
liability. Lets say $32/ oz and that means an outstanding liability of
about 9 million ounces.
Or this gem:
5119. Redemption and cancellation of currency
(a) Except to the extent authorized in regulations the Secretary
of the Treasury prescribes with the approval of the President,
the Secretary may not redeem United States currency (including Federal
reserve notes and circulating notes of Federal reserve banks and
national banks) in gold. However, the Secretary shall redeem gold
certificates owned by the Federal reserve banks at times and in amounts
the Secretary decides are necessary to maintain the equal purchasing
power of each kind of United States currency. When redemption in gold
is authorized, the redemption may be made only in gold bullion bearing
the stamp of a United States mint or assay office in an amount equal
at the time of redemption to the currency presented for redemption.
(b)
(1) Except as provided in subsection (c)(1) of this section, the
following are public debts bearing no interest:
(A) gold certificates issued before January 30, 1934.
(B) silver certificates.
(C) notes issued under the Act of July 14, 1890 (ch. 708, 26 Stat. 289).
(D) Federal Reserve notes for which payment was made under section 4
of the Old Series Currency Adjustment Act.
(E) United States currency notes, including those issued under section 1
of the Act of February 25, 1862 (ch. 33, 12 Stat. 345), the Act of
July 11, 1862 (ch. 142, 12 Stat. 532), the resolution of January 17,
1863 (P.R. 9; 12 Stat. 822), section 2 of the Act of March 3, 1863 (ch.
73, 12 Stat. 710), or section 5115 of this title.
Sec. 5118. Gold clauses and consent to sue
(a) In this section -
(1) "gold clause" means a provision in or related to an obligation
alleging to give the obligee a right to require payment in -
(A) gold;
(B) a particular United States coin or currency; or
(C) United States money measured in gold or a particular United States
coin or currency.
(2) "public debt obligation" means a domestic obligation issued or
guaranteed by the United States Government to repay money or interest.
(b) The United States Government may not pay out any gold coin.
A person lawfully holding United States coins and currency may present
the coins and currency to the Secretary of the Treasury for exchange
(dollar for dollar) for other United States coins and currency
(other than gold and silver coins) that may be lawfully held.
The Secretary shall make the exchange under regulations prescribed
by the Secretary.
(c)
(1) The Government withdraws its consent given to anyone to assert
against the Government, its agencies, or its officers, employees,
or agents, a claim -
(A) on a gold clause public debt obligation or interest on the obligation;
(B) for United States coins or currency; or
(C) arising out of the surrender, requisition, seizure, or acquisition
of United States coins or currency, gold, or silver involving the effect
or validity of a change in the metallic content of the dollar or in a
regulation about the value of money.
(2) Paragraph (1) of this subsection does not apply to a proceeding in
which no claim is made for payment or credit in an amount greater than
the face or nominal value in dollars of public debt obligations or
United States coins or currency involved in the proceeding.
(3) Except when consent is not withdrawn under this subsection,
an amount appropriated for payment on public debt obligations and for
United States coins and currency may be expended only dollar for dollar.
(d)
(1) In this subsection, "obligation" means any obligation (except
United States currency) payable in United States money.
(2) An obligation issued containing a gold clause or governed by a
gold clause is discharged on payment (dollar for dollar) in United
States coin or currency that is legal tender at the time of payment.
This paragraph does not apply to an obligation issued after October 27, 1977.
Note this last sentence.
...does not apply to an obligation issued after Oct 27, 1977
Apparently the members banks of the Federal Reserve system can freely
deal in public gold and in the form of "Gold Certificates" can redeem
them from the treasury.
Anyway my point is that titles 12 and 31 of USC provide ample "exceptions"
some requiring the complicity of the President, to deal directly in gold
with the Federal Reserve member banks...in many cases these are also the
"Bullion Banks". Here anything is possible as the books can be cooked
to convert funds into and out of bullion at will and minute to minute.
They are authorized by USC to do this.
Henri
Observations from Chris H:
1)They obviously didn't answer your questions by limiting responses
to the Treasury Department. I am not aware that anyone has accused the
Treasury of intervening in markets.
2) The "staff memo" on blank paper is a red herring. No one can be held
accountable for it, there's no real evidence it is a real document...
it's meant to falsely deny whether being liable for lying.
I do historical research and see unsigned documents like this all the time.
They are toilet paper.
3) You should find a way to re-ask your questions. Break them down into
simple direct questions that mostly require a yes or no answer and leave
no wiggle room. Ask questions them specifically of the Fed only.
4) I don't think any Fed official is going to lie outright about essentially
illegal acts. Ultimately, all of them fear having it come back and swallow
them up. Put out a press release that accuses them of pointedly refusing
to deny that the Fed is doing such activities.
From WG:
Bill,
It seems to me that there is a very important happening coming up
and that is Alan Greenspan's Senate comfirmation as fed chairman.
I must be slowing down because it took me all night to think of it.
It seems to me also an attack thru the senate members on the committee
holding the hearings friendly to Gata's cause would really be key.
Some kind of a blitz would really be fun.
*****************************************************************
I SI's DougAK vote above as a YES to do.
...attack thru the senate members on the committee friendly to Gata's cause
and shine the spotlight onto Alan Greenspan with above mentioned tactic of
asking yes/no questions so Alan cannot reply in GreenSpeak.
*****************************************************************
From David G:
I also have a sneaky feeling that their answer to Q4 was less than
forthright. Their answer is so precise in terms of definitions that
I suspect they are avoiding something. Could it be that their relationship
with the BIS is used act as a cut-out to other central banks - thus making
their answer accurate? The BIS is not regarded as "foreign central banks,
foreign banks, or foreign accounts" as it is a supranational organisation
- i.e., the central bankers club.
My own feeling is that the BIS are bigger players in this market
than anyone so far suspects -- but this is just a gut feeling and
is not based on any factual info, although the actual history of
the BIS strongly supports this view -- did you know it was founded by the:
"powers of financial capitalism [who] had another far reaching aim,
nothing less than to create a world system of financial control in
private hands able to dominate the political system of each country
and the economy of the world as a whole. This system was to be controlled
in a feudalist fashion by the central banks of the world acting in concert,
by secret agreements arrived at in frequent private meetings and conferences.
The apex of the system was to be the Bank for International Settlements
in Basle, Switzerland, a private bank owned and controlled by the world's
central banks which were themselves private corporations."
This quote comes from Carroll Quigley, an eminent American historian who
wrote Tragedy & Hope [page 324 of the GSG & Associates impression of the
original 1966 Macmillan version).
All the best, Bill Murphy
The above mention of GATA is as follows.
Bill Murphy, Chairman, Gold Anti Trust Action (GATA) gata.org
Also, GATA related articles can be obtained at the pay for view site.
Bill Murphy, Le Patron, Le Metropole Cafe lemetropolecafe.com |
