Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Bill Murphy who wrote (36873)	7/9/1999 12:57:00 AM
From: Hawkmoon	Read Replies (4) \| Respond to of 116764

Bill, Are you making a recommendation regarding gold? Is this a potential conflict of interest with regard to your role as head of GATA? IMO, you really lose all credibilty when you make these blatant attempts to encourage people to buy gold. Are you willing to compensate them should it go the other way? After all, many gold mines were apparently quite active in intensifying their hedging activities. Again, I'm sorry to criticize you, but when you make these blatant recommendations, you sound exactly like one of these commodities brokers we see on TV and radio. And imagine if I were to come out here and say the exact opposite of your post....: "Yes, right on. Time to be an aggressive gold seller. No buts. Just sell. Silver too". I think you get the point. Regards, Ron

To: Bill Murphy who wrote (36873)	7/9/1999 3:48:00 PM
From: Alex	Read Replies (1) \| Respond to of 116764

US Congress Unlikely to Back Imf Gold Sale in Current Form - Part 1 --Rep. Frank to amend gold-sale bill to give support to miners --Clinton administration to continue push for IMF gold sale By Blair Pethel, Bridge News Washington--Jul 9--The proposed gold sales by the International Monetary Fund to help fund poor-country debt relief is unlikely to be approved by the US Congress, thereby nullifying the IMF's plan to fund its portion of debt relief, lawmakers and congressional staff told Bridge News. Congressional opposition to the sale has become so vocal that US Treasury officials privately concede they will have an uphill battle in their lobbying effort to convince lawmakers to support the proposal, which is part of the fiscal 2000 US budget proposal. Because of the opposition, Rep. Barney Frank, D-Mass., told Bridge News he planned to introduce an amendment to the legislation that would allow the sale to proceed, but would require 10% of the proceeds to be set aside for unemployment insurance for miners in poor gold-producing countries that could lose their jobs because of further gold-price declines. The IMF is seeking to sell up to 10% of its gold reserves--about 10 million ounces--invest the proceeds in US Treasuries or comparable interest-bearing securities, and use the income generated to fund debt relief for heavily indebted poor countries--known as HIPC. The US Treasury Department estimates that income of around $2.5 billion to $2.8 billion would be generated by this investment over the next 15 years. But the IMF and central bank sales are pressuring gold prices to a 20-year low. The price decline is hurting gold- producing countries--many of which are HIPC. Several gold-producing nations have in recent weeks publicly opposed the IMF proposal, most notably Ghana, one of the world's largest producers. Even though Ghana would be helped under the HIPC initiative approved last month by the Group of 8 leaders at the Cologne Summit, Ghana has said the IMF should stop its gold-sale plans. Ghana's Minister of Mines and Energy Fred Ohene Kena told Bridge News the IMF plan would be counterproductive, and falling gold prices would paralyze the economies of gold-producing countries. "The IMF must find other ways of supporting countries in distress which rely heavily on gold, especially when its price is so low," he said. futuresource.com

To: Bill Murphy who wrote (36873)	7/9/1999 3:51:00 PM
From: Alex	Read Replies (1) \| Respond to of 116764

Congress Unlikely to Back Imf Gold Sale in Current Form: Part 2 <Picture> This plea, together with other notable opposition, most recently from South African President Thabo Mbeki, has resonated among US lawmakers and helped to galvanize opposition to the proposal, congressional staff and lawmakers said. Legislation has already been introduced by New Jersey Republican Rep. Jim Saxton--and co-sponsored by House Majority Leader Dick Armey of Texas--to block the sale of IMF gold unless the proceeds are returned to the nations that contributed the gold to the IMF's reserves initially. Opposition is bipartisan in both the House and Senate because: --It would hurt US gold producers and cost mining jobs; --It would hurt poor gold-producing countries overseas more than the debt relief would help, and --It would provide the IMF with additional resources not subject to extra-institutional oversight. "I don't know of anyone who has explicitly identified with this approach," a senior House staffer said. "While there is a majority of lawmakers who support financing debt relief, none of them support this particular mechanism." The staffer conceded that "there are probably a large number of members who are open-minded" on the issue, but he noted that "there is some high-level opposition, and it's by no means clear to most members that this is the best or only means to finance IMF debt relief." He stressed that the link between the IMF sale and its Enhanced Structural Adjustment Facility is "quite controversial." ESAF is the IMF's concessional lending window, through which it makes interest-free loans to its poorest members. It is also the mechanism the IMF would use to fund debt relief, the procedure working as follows: --When a country qualifies for debt relief, the IMF would make an interest-free loan to it from ESAF; --The country would then use that interest-free money to make interest and principal payments on its existing stock of IMF debt, ultimately paying it down. --The ESAF loan would then be repayable--principal only --over an extended maturity, giving the HIPC country in effect zero-interest refinancing of its IMF debt. However, to qualify for an ESAF loan, an HIPC country must meet IMF conditions, which include economic and structural reforms that many lawmakers believe hit the poorest disproportionately hard. Rep. Frank told Bridge News that "I'm for selling gold, but not for the ESAF. It causes problem by forcing adjustment measures which make the poor worse off." "The bottom line is that the reason we're going through all these circuitous financing techniques with the IMF--and to a certain extent the World Bank--is because the two institutions are unwilling to write down loans. We go through this fiction so it will appear that they are being repaid by their borrowers," a Senate staffer pointed out.

To: Bill Murphy who wrote (36873)	7/9/1999 3:53:00 PM
From: Alex	Respond to of 116764

Congress Unlikely to Back Imf Gold Sale in Current Form: Part 3 <Picture> While that assertion is certainly true, it is also a fact of life: the IMF has not and will not write off debts. So if IMF debt relief is to be funded, it will have to be funded through ESAF, US administration officials assert. The US Treasury Department also recognizes and hopes to capitalize on what many on lawmakers concede: There is broad support among lawmakers for the HIPC initiative as a concept; the difference lies in the funding. But Treasury believes its efforts will ultimately convince lawmakers that the widespread and long-term benefits of debt relief will far outweigh any losses to an individual country's gold sector. However, administration officials realize that they need urgently to start marshalling their arguments and getting them out to congressmen. Treasury sees 2 types of opposition in Congress--that from gold-state lawmakers and that from lawmakers opposed in principle to the IMF. Those from gold-producing states should be convinced by arguments that the IMF is designing the proposed sale in such a way as to have little or no impact on the market price. Former Treasury Secretary Robert Rubin said 2 weeks ago that the sale is being designed in such a way as to have no market impact. However, Treasury is also critical of lawmakers who support the concept of debt relief yet remain opposed to gold sales to fund the proposal. Officials believe opponents of gold sales should make fresh proposals to fund the initiative if they don't support the gold sales. Rep. Frank said he would support a purely budgetary allocation to fund IMF debt relief. But he recognized he probably stands in a small camp on that issue. Thus he proposed setting aside 10% of the sales proceeds to create an additional social safety net for those hit hardest by both the sales and the adjustment required by the IMF under ESAF conditions. But he recognizes that even that is going to be something of a long shot. "My sense is that now that some of the African producers have come out against it, it's going to be hard to get it across the Hill," Frank concluded. Bridge News, Tel: (202) 662-7109 Send comments to Internet address: emerg@bridge.com End