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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: lorne who wrote (36381)	7/2/1999 8:46:00 PM
From: CuriousGeorge	Read Replies (1) \| Respond to of 116915

International Finance Discussion Papers Federal Reserve Board Can Government Gold Be Put to Better Use? Qualitative and Quantitative Effects of Alternative Policies Dale W. Henderson, John S. Irons, Stephen W. Salant, and Sebastian Thomas 1997-582 Abstract: Gold has both private uses (depletion uses and service uses) and government uses. It can be obtained from mines with high extraction costs (about $300 per ounce) or from above ground stocks with no extraction costs. Governments still store massive stocks of gold. Making government gold available for private uses through some combination of sales and loans raises welfare from private uses by removing two types of inefficiencies. For given private uses, there is a production inefficiency if costless government gold is withheld while costly gold is taken from mines. There are use inefficiencies if costless government gold is withheld from private users. We assess both qualitatively and quantitatively the gain in welfare and its distribution. Any policy in a class maximizes welfare from private uses. One policy involves selling all government gold immediately. Another involves lending all remaining government gold in every period and selling government gold gradually after some future time. Government uses might require gold ownership but not gold storage. If so, any loss in welfare from government uses would be much smaller under the policy involving lending and selling gradually. We construct and calibrate a model of the gold market. We prove that governments always obtain more revenue by making their gold available sooner. For a representative set of parameters, there is a gain in total welfare (discounted economic surplus) of $130 billion (1997 dollars) if governments act now instead of twenty years from now. Before any redistribution, governments gain $128 billion, and the private sector gains $2 billion. According to our measure, a large share of the gain (37%) comes from removing the production inefficiency. Keywords: Gold, exhaustible resource, extraction of a durable Full paper (455 KB PDF) (Adobe acrobat) bog.frb.fed.us

To: lorne who wrote (36381)	7/2/1999 8:48:00 PM
From: John Hunt	Read Replies (2) \| Respond to of 116915

Traders' Commitments (COT) From Kaplan Site Today << As of June 29, 1999, released at 3:30 p.m. on July 2, 1999, the commitments for COMEX gold futures show commercial insiders long 142,021, short 60,945; speculators long 8,971, short 92,582. Small traders were long 36,708, short 34,173. The average historic ratio for commercials is 2:3 long to short; for speculators, 2:1 long to short. Commercials were thus net long 81,076 while speculators were net short 83,611, which represents a modest deterioration from two weeks earlier. This indicator remains EXTREMELY BULLISH. The traders' commitments for the white metals as of June 29, 1999, released at 3:30 p.m. on July 2, 1999, were somewhat worse for silver, fabulously better for platinum, and little changed for palladium. For COMEX silver futures, commercial insiders were long 12,353, short 44,203; speculators long 29,679, short 9,507. This means that the commitments for silver are significantly bearish, a modest deterioration from moderately bearish two weeks ago, though far better than the extreme bearish numbers at silver's recent peak. Looking at NYMEX platinum futures, commercial insiders were long 6,281, short 5,014; with speculators long 3,547, short 6,066. These commitments are significantly bullish, an enormous improvement from strongly bearish two weeks ago. For NYMEX palladium futures, commercial insiders were long 2,504, short 1,692; and speculators long 134, short 805. These are strongly bullish, and are little changed from two weeks ago. Due to platinum's fantastic improvement, this indicator has improved to SLIGHTLY BULLISH. >> goldminingoutlook.com