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To: Enigma who wrote (45968)	12/14/1999 2:49:00 PM
From: Alex	Respond to of 116764

Subject: Wanniski and Mundell Promote Gold as Y2K Currency Solution Link: web4.washtimes.com. Comment: Hostility to gold as a currency is based on faith in government planning to provide enough fiat money -- but not too much -- to keep the system running smoothly. The war against gold is a deeply religious one based on rival views of the proper institution to provide money: the free market vs. a government monopoly (central banking). This year's Nobel Prize winner, Robert Mundell, has long recommended currencies tied legally to gold, though not a full gold coins standard, where holders of government paper money can legally redeem it in gold coins, i.e., the 19th-century's gold standard. (There was no increase in British wholesale prices from 1815 -- the Battle of Waterloo -- to 1914, when World War I led to the suspension of gold convertability.) My prediction: his recommendation will be ignored, as it always is. It transfers economic sovereignty back to individuals, who use currencies or abandon them, as they see fit. Gold is the great enemy of central banks and government deficits. The religion of deficit spending is just too deeply entrenched in modern government. This is the century of central banking. The next century won't be. This is from the WASHINGTON TIMES (Dec. 13). * * * * * * * * * * * Y2K currency strategy . . . just in case By Jude Wanniski As 1999 rolls into 2000, the world?s interconnected computers may have difficulty keeping up with a trillion debits and credits in 180 different currencies. . . . It is this background that led Professor Mundell, now at Columbia University, to recommend that the United States and the Europeans, at least, fix the dollar/euro exchange rate for a few months going into the new century. The concern is the Y2K ?computer bug.? As 1999 rolls into 2000, the world?s interconnected computers may have difficulty keeping up with a trillion debits and credits in 180 different currencies. Errors and computer breakdowns are of course constant occurrences in the global financial network, but they are cordoned off and repaired. There is no experience, though, with myriad errors and breakdowns occurring unexpectedly, here and abroad. . . . The Mundell idea was not exactly new. Empower America?s Jack Kemp last June 11 sent a letter to President Clinton, urging him to consider a dollar/gold to provide an extra measure of stability through the Y2K unknowns. On Aug. 11, the president rejected the idea, citing the report of the 1981 Gold Commission that a return to gold was impractical and would tie the hands of the Federal Reserve: ?I do not believe that fixing the price of gold and the dollar would achieve the objective of stability in the event of Y2K problems.? The implication is that the Fed may wish to flood the banking system with liquidity if small problems evolved into critical ones. Fixing the dollar/ gold parity, though, does not prevent the most liberal use of the Fed?s discount window to disgorge liquidity, which Chairman Alan Greenspan has promised will be wide open at rollover. Mr. Greenspan is certainly aware of the Kemp/Clinton exchange of Y2K letters ? and possibly the more recent Mundell recommendation. Although in recent years he has shown less respect for the gold signal than he had in his earlier career, when he was known for his advocacy of a gold standard, Mr. Greenspan may be prepared at a moment?s notice to recommend some such accord with Treasury. Mr. Mundell says Treasury would have to open its gold window, offering to buy or sell in order to stabilize the price, but the Fed would have to cooperate in not sterilizing these operations by not targeting the overnight lending rate ? that is, creating more or less liquidity than the market is demanding at the fixed gold price. It was such an accord in 1942 that enabled gold to be fixed at $35 and the enormous debt of WWII financed at 2 percent, the process removing the risk of inflation to the government?s creditors. It would better if the markets were told in advance, says Mr. Mundell. As December opened, with but a month left before rollover, the euro/dollar/yen rates are already exhibiting an agitation that is almost certainly related to Y2K. . . . While it is a bit puzzling that his Y2K recommendation is being dismissed so casually, it may pick up support as the countdown continues. Without a helping hand, the fledgling euro may not be able to survive the Y2K unknowns. And while it may take human hands only days or weeks to fix the mechanical problems at airports, seaports and power grids, it may take a lot longer to repair the problems facing digital money in a floating regime. Link: web4.washtimes.com. --------------------------------------------------------------------------------

To: Enigma who wrote (45968)	12/16/1999 2:11:00 PM
From: Richnorth	Read Replies (1) \| Respond to of 116764

Le Metropole members, Paul Kaimla has served commentary at the Man Ray Table entitled, "GOLD BUGGED." GOLD BUGGED Author Arthur Hailey has aimed a poison pen at Barrick By Paul Kaimla Canadian Business November 25, 1999 "It's been 30 years since Arthur Hailey became a household name with his disaster novel, "Airport," which was made into the widely imitated and satirized 1970 movie of the same name starring Burt Lancaster and Dean Martin. Since then the Canadian citizen and former Toronto resident has written books that expose the dirty secrets of everything from the automobile to the pharmaceutical industries. But now the cantankerous 79-year-old author has turned his critical eye toward the gold industry -- and zeroed in on Toronto-based Barrick Gold Corp., North America's second-largest bullion producer." This is another piece of very good journalism that tells us the GATA and all of your efforts is having an impact. Barrick Gold has been besieged by shareholder unrest. That is why they are going all over trying to justify their current hedging strategy to the gold community. You will note in this article, that Barrick's Vincent Borg, vice-president of corporate communications takes a cheap shot at Arthur Hailey who was a long time Barrick shareholder and supporter. "According to Borg, Hailey's comments are typical of gold bugs who believe there is a conspiracy between Barrick, Wall Street banks and the U.S. Federal Reserve, which apparently wants the price of gold low because it is an inflation indicator. "Have you ever talked to these gold bugs, the Arthur Hailey's of the world?" Borg asks." This is Barrick's own spokesman denigrating those of us that have an interest in the gold market and have taken the time to realize that something is very wrong with it. Does this man think the internet crowd is going to invest in Barrick? No wonder Barrick's stock is stinking up the place. Oh, they probably don't care. At last look, Goldman Sachs owned 2,853,000 shares of Barrick stock. I hope all of you take the time to read this piece and then, if you have a bit of time, tell Mr. Vincent Borg what you think, both of his comments and of Arthur Hailey. Mr. Borg - you did manage to get one thing right. We do believe there has been some sort of conspiracy between Barrick, the bullion banks and the U.S Fed and GATA is out to do what we can to prove it. The gold price is hundreds of dollars below its natural equilibrium price. That is going to be found out soon and when it is, the gold price will fly and companies like Barrick are going to have to explain to shareholders why they did not cover when they had a chance to. Love to be a fly on the wall for that one. <A HREF="http://www.LeMetropoleCafe.com/scripts/products.cfm">Le Metropole Cafe</A> All the best, Bill Murphy Le Patron www.LeMetropoleCafe.com