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To: Jim McMannis who wrote (42270)	10/6/1999 1:53:00 PM
From: Ron Struthers	Respond to of 116841

Ken, I don't think they have much choice, the CBS were being over powered by the market and had to give up on their activities to keep gold down, perhaps it was long enough to get Long Term Capital off the hook though. What the CBs did was announce it in a way that makes them smell like roses, rather than saying something like. 'We don't have enough gold to lease/lend to the high market demand at this time and as a result intend to curtail these activities and only have limited supplies to sell over the next several years. With the high demand in the market and the growing inbalance we are concerned we will not be able to call in our gold that was leased previously. In fact we are now beginning to panic as we realize that many parties we have contracted leases with are in financial difficulty and unable to return the gold they borrowed. No US$$ please, we are only interesting in regaining ownership what is rightfully ours. However due to the recent market in gold we are willing to give you a little more time to pay back our precious golden currency " Well this certainly sounds a lot better to my ears <g> Ron

To: Jim McMannis who wrote (42270)	10/6/1999 6:01:00 PM
From: Ken Benes	Read Replies (1) \| Respond to of 116841

Jim: That is the key, it is not in the best interest of world finance. It is easy to envision a cascading effect, the bullion banks go belly up, the dollar continues it slide for other reasons, and there is upside pressure on interest rates. These last two would have there own implications for the derivative markets. The global fire squad would have trouble dealing with one of the above markets imploding, all three would be near impossible. I agree with you, gold may be the easiest to contain, albeit prices may stabilize at or around the 300 dollar level, affording many of the gold derivatives to be unwound without seriously damaging the global landscape. There is a lot riding on this, we are on the cusp on some interesting times. Ken