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Gold/Mining/Energy : Barrick Gold (ABX)

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To: russet who wrote (2100)	9/23/2000 11:43:29 AM
From: nickel61	of 3558

Dear Russet, No one is as blind as he who will not see. I am amazed that you yourself have delineated the obvious observation that the "market price" of gold is completely out of whack with the supply demand picture and yet you dismiss out of hand the anaylsis that explains it. The presidential candidate Gore just called for a 30 million barrel "swap" or release of oil from the strategic oil reserve in order to depress the spot price of oil before the election. It is a "swap" because what they do is tell Exxon or Chevron to release ten million barrels of their reserves in exchange for the future delivery of oil from the reserve. THe availability of the actual oil reserve makes it possible to have oil immediately dumped on the spot market and depress the price and allows the creation of many times the thirty million barrels of actual oil to be brought to bear on the market spot price because of the ability of "market traders" to create Paper supply through the use of derivatives of the actual oil in many times the amount of actual oil released. Since there is a total of 570 million barrels of oil in the reserve all of which could be released to achieve political objectives before the election the ability to spin the amount up to depress the spot is sizable. This is basically the same thing they have been doing for years in the gold market using a few very large producers as the equivalent of the strategic oil reserve i.e. the actual physical gold that backs up the threat of their paper gold being created out of nothing and sold into the market price to depress spot so they make billions on their gold carry trade which requires them to someday replace their borrowed gold that they sold into the market years ago at higher prices and if the spot price is lower when they have to repay the gold they make billions. What part of this don't you understand?

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