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

To: Jim McMannis who wrote (42888)	10/13/1999 4:25:00 PM
From: Bobby Yellin	Read Replies (1) \| Respond to of 116762

Your calls have been excellent and you have shown prudence.. ps I have totally given up on ole69er..I decided that she probably has stopped taking her medicine..after her last post..my goodness if one is exposed to Bach etc..and it still can't penetrate..nothing can bobby@thingsneverceasetoamazeme.com

To: Jim McMannis who wrote (42888)	10/13/1999 5:15:00 PM
From: Ken Benes	Read Replies (1) \| Respond to of 116762

Jim: We are certainly looking at a muddled picture. Gold up about 70.00, the bond rising almost 50 basis points during the period gold ran up, and the dollar loosing strength. With the interrelated markets we currently have, each of these markets are acting both independently and as a group. It is difficult to invest in gold without having off setting positions in bonds. The dollar has an intricate roll in the equity, bond, and commodities markets. What is worrisome, the trade gaps, and the resurgence of the Asian markets. This is going to have a negative impact on the dollar and the bond. The gold market is holding its strength in a market where it is difficult to understand the short position and its relationship to producer forward sales. What is more worrisome is how the proceeds of forward sales, hedging, and other derivatives have been invested. What is known, the bond is a large component in these hedging strategies. Unfortunately, investments in bonds are highly leveraged. A rise in the gold market and a fall in bonds can produce exponential loses for the bullion banks and hedge funds that specialized in this trade. The additional pressures of a falling dollar can only exasperate this scenario. It would appear to me that this confluence of events may be stressing the resilency of a lot of markets. To further cloud the picture, it is reasonable to assume, that a portion of the dollars invested in the bond market may be used to collateralize investments in equities. The dollar is key, it is difficult to comprehend the consequences of a meaningful move out of the dollar. The dollar, commodities, and bond markets may be stretched to the breaking point. Ken