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

To: Bobby Yellin who wrote (37202)	7/15/1999 8:33:00 PM
From: goldsnow	Respond to of 117062

Gold Companies That Don't Hedge Could Have S&P Ratings Reduced New York, July 15 (Bloomberg) -- Gold producers that don't take steps to lock in prices with hedging programs may have their credit ratings cut by Standard & Poor's Corp., the credit-rating company said. Gold prices have shed 12 percent this year to reach 20-year lows, after several central banks including the U.K.'s announced plans to sell reserves. Gold recently traded at US$254.40 an ounce, down from about US$310 a year ago. S&P said it will wait a ''quarter or two'' to see where gold prices head and evaluate companies on a ''case-by-case basis'' before cutting any ratings. It didn't say which companies it's considering downgrading. Low gold prices ''could lead to ratings downgrades for those gold producers who do not have a significant hedging program in place,'' said Thomas Watters, an analyst at the credit rating agency, on a conference call. The agency said it's not considering a downgrade of Barrick Gold Corp., the world's fourth-largest gold producer and the biggest user of hedging, in which miners agreed to sell current production at a fixed price in the future. The Toronto Stock Exchange's gold and precious metals index has fallen 20 percent this year. The gold index of the Standard & Poor's 500 Index has fallen 13 percent in 1999. NYSE/AMEX delayed 20 min. NASDAQ delayed 15 min. Access More Information and Services Above ©1999 Bloomberg L.P. All rights reserved. Terms of Service, Privacy Policy and Trademarks.

To: Bobby Yellin who wrote (37202)	7/15/1999 10:38:00 PM
From: PaulM	Read Replies (2) \| Respond to of 117062

Britain Misses Golden Opportunity to Show African Solidarity "Sentiment counts for nothing when it conflicts with the Government's suddenly invented policy of selling off the gold reserves." telegraph.co.uk:80/et?ac=000626415357098&rtmo=wsQlAtnb&atmo=99999999&pg=/et/99/7/16/cncom16.html B, the questions are becoming so obvious that the failure by most of the press to acknowledge them has to be chalked up to protecting vested interests. Why is Britain which was in the forefront of promoting IMF gold sales for the "poor" so bent on ignoring calls from the same "poor" to stop the sales? Why is the IMF willing to take huge politcal flack to go forward with gold sales that would fund about 5% of its debt initiatives for the "poor"? Again, against the wishes of the "poor"? Really gives insight into how important the gold market is. I'd say virtually any other requst from the South Africans--and I mean ANY OTHER REQUEST--Blair would take the opportunity to at least paint himself as the defender of the oppressed. Seems this "demonetized" metal has to be exchanged for dollars at ALL COSTS. I think the press coverage makes us forget that there are plenty of other things the CB's and treasury's could with this "demonetized" metal. For example, they could return it to the rightful owners, the public, who could then decide if they want to sell. Our treasury could return this "mere commodity" to the Americans from whom it was confiscated at $35 dollars per ounce. Now that the "national emergency" is over and gold is no longer a monetary asset, this would seem the perfect opportunity to right a historical wrong. We don't hear much about those sorts of plans, do we. Gold has to be EXCHANGED FOR DOLLARS. That's it in a nutshell, I think.

To: Bobby Yellin who wrote (37202)	7/20/1999 8:12:00 AM
From: long-gone	Read Replies (1) \| Respond to of 117062

All That Glisters BUSINESSAGE - London, England July 1999 By Daivd Guyett The recent dramatic fall in the gold price could have been triggered by the Bank of England irresponsibly signaling a massive unloading of bullion onto the market, amid suspicions that a global cartel has been attempting to manipulate values, writes David Guyett. When the Treasury announced in early May that it was going to auction over half the nations 715 tonne gold reserves, it caused eyebrows to be raised in many parts of the world. It also triggered a steep decline in the market price of gold from just below $290 an ounce to $281.50. In the blink of an eye over $90 million was wiped off the value of the gold the Treasury has earmarked for sale. Ordinarily, central bank gold sales are conducted in the utmost secrecy and are then routinely announced after the event. This ensures a stable market price for the bank to sell into. Effectively talking down the gold price by announcing "future" sales is considered curious, especially for a nation possessing a long history of managing its gold reserves with skill and subtlety. More recently, Gordon Brown's public comments in favour of the proposed sale of 10 million ounces of IMF gold have merely added to the confusion. Unsurprisingly, the prospect of an additional large official disinvestment saw an even more dramatic plunge in the market price to under $260. The Chancellor's 1comments, said to be aimed at raising funds to alleviate the horrendous debt burden of impoverished third world nations, wiped a further $300 million off the value of British gold reserves. While many market analysts ponder just what the Chancellor hopes to achieve by apparently cutting off his nose to spite his face, an independent American gold pressure group believe they know the answer. Formed earlier this year, the Gold-Anti Trust Action Committee, known simply as GATA, claim the gold market is in the grip of a powerful cartel of leading Wall Street and European banks. These are said to have colluded to manipulate the price of gold to their commercial advantage. According to Bill Murphy, a commentator on the gold market and GATA Chairman, up to twenty leading banks may be party to a cartel arrangement. Murphy says that many of these banks have leased gold from central and other gold banks at "strike" prices as low as $290. The lending banks, according to the insiders, charge little more than 1% per annum as a leasing fee. This amounts to "a virtual interest free loan," Murphy says. By selling the leased gold, the banks receive a hefty cash "pool." That is then invested in US Treasury securities or placed in other overseas markets. With Treasury yields climbing above 6%, the net 5% "windfall" returns earned by the borrowing banks generate huge profits. Later covering their short positions at lower strike prices will generate additional income. GATA believes that short sales of this type collectively total as much as 8,000-10,000 tonnes. Others believe it could be higher and amounts of 14,000 tonnes are mentioned. Meanwhile, one Wall Street bank is rumoured to be "short" of 1,000 metric tonnes, worth about $9 billion. This is believed to be Goldman Sachs, America's largest investment bank. Goldman's refused to comment but insiders at the bank deny the position is as large as claimed. The risk of this short sale strategy is if the gold price shoots up beyond the $290 level. With annual gold mining production of 2500 tonnes per year, it could prove impossible for those "short" banks to buy sufficient quantities of metal to repay back their loans. Locked into a trap of their own-making, this could stampede the banks and cause the gold price to skyrocket, turning easy profit into crippling losses. Were just one of these banks to fail under the burden of such losses it could trigger a systemic collapse of the international economy. This, Murphy believes, is the underlying reason why the Treasury too the unusual step of announcing a gold auction in advance, and why Gordon Brown is so strongly committed to an IMF sale. At the time the Treasury issued its announcement, the gold price was preparing to penetrate the $290 level. Forcing down the price enables the banks involved to extricate themselves from their now suspect trading positions. Murphy admits he cannot prove his case. However, he says the circumstantial evidence is overwhelming in support of his view. Not least he points to testimony given by Federal Reserve Chairman, Alan Greenspan, who told the House Banking Committee last summer that "central banks stand ready to lease gold in increasing quantities should the price rise". What else could the Fed be up to?" Murphy asks, other than the wholesale manipulation of the gold price. Whether Murphy's group is ever able to prove that the market is a rigged roulette wheel remains to be seen. Meanwhile GATA's efforts constitute the only truly independent attempt this century to penetrate the mysteries of one of the most secretive of all financial markets.

To: Bobby Yellin who wrote (37202)	7/20/1999 9:06:00 AM
From: Rarebird	Read Replies (1) \| Respond to of 117062

U.S. Trade Deficit Widened in May to a Record $21.3 Billion Washington, July 20 (Bloomberg) -- The U.S. trade deficit in goods and services widened in May to a record as imports surged and exports fell for the sixth month in the last seven. The deficit totaled $21.335 billion for the month compared with $18.591 billion in April, the Commerce Department said. April was previously reported as $18.939 billion. Analysts expected a May deficit of $19.2 billion. The deficits with Mexico, Europe and China widened. The trade deficit with Japan narrowed