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Gold/Mining/Energy : Samex Mining | OTC:BB - SMXMF | Canada - V.SXG

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Sep 10 5:00 PM EST

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To: Travbfree who wrote (415)	2/7/2000 12:31:00 PM
From: Travbfree	Read Replies (1) of 539

(This article by Bill Murphy starts at post #410 and reads in sequence to #417) So what does all this mean for the gold price and for the share prices of the gold companies of your choice? Many of you are concerned that Friday's move up will be just another blip. Let me begin by prefacing what my thoughts are with this email from Cafe member Peter S.: "Recently I've noticed that the lease rate is very low, 0.5 percent, which suggests that plenty of gold is available for lease (possibly from the U.S. Treasury) but there are few takers. "As memory serves me, this is quite the opposite of the last spike in gold, which occurred when lease rates were much higher. This suggests that the latest gold spike is due to a dearth of lessees willing to take the risk of runaway gold prices, while the first spike was due to the perception that the amount of leased gold was going to dry up. This is an important difference that in no small part has come about as the result of GATA and LeMetropoleCafe. You have changed the market perception in a major way." Pete is right-on. The risk of borrowing gold becomes more apparent by the day. Who cares if the lease rate is 0.4 or 1 percent? None of that matters if the gold price can go bonkers to the upside in hours and thereby turn a 1 percent gold loan into a 25 percent gold loan -- or worse, due to having to pay the gold back at a higher price than it was borrowed at. The "such a deal" gold loan is becoming a dinosaur. The supply hitting the market from those trades will disappear. That is a big blow to the manipulation crowd. Things are going to get more painful for them. There is no reason we could not see $365 gold this coming week. Why not? Friday's action was more explosive early in the move than in late September. That may or may not happen, but I stick with my big- picture outlook. It is my opinion that a fair supply/demand equilibrium price for gold today (with the manipulation game players exiting stage left) is around $600 per ounce. That is the gold price I expect to see flashing on the scoreboard before the end of the year if the manipulation buggers have to run for the hills. As for the price of silver, $9.78 was my silver price target all last year. Since the current price just above $5 has held, too much silver has been devoured at too cheap a price. We could see $12 silver this year. The investment game plan all along has had that price in mind as a realistic target. It will come. And that is why I stayed with my favorite gold and silver investments all this time. The risk-reward ratio does not get any better. The Gold Shares On Tuesday an analyst for Deutsche Bank (one of the Hannibal Cannibals) analyst DOWNGRADED Placer Dome. And Placer Dome soared 24 percent the next day. Great call! Until Friday the gold shares were being given up for mortsville. Nobody wanted them. My how things change in a day. Well, not really yet. But very soon gold shares will be the "in" thing. One reason for the horrible performance of the gold shares is that big gold funds are being dismantled while portfolio managers who invested in gold shares are being fired. For example, an entire six-man crew in the Ohio State Pension Fund was let go. They loved the future for gold shares -- Homestake in particular -- and were canned for it. I have had many queries the past two months. What is wrong with Homestake? What was wrong was the money managers who inherited the Ohio State Pension Fund gold share equities. They were selling since $10 and drove the price of Homestake down to just above $6. Nothing wrong with the company, just the misinformed judgment of those who have just fired those portfolio managers. That is another anecdotal sign of a major, major bottom in the gold shares. (This article is concluded on post #417)

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