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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Earlie who wrote (88364)	1/12/2001 9:26:31 AM
From: BSGrinder	Read Replies (2) \| Respond to of 132070

Earlie, There are some very good logical explanations for the "amazing" refusal of the gold price to reflect the huge sea of overvalued paper. There is essentially an organized defense of the gold carry trade by the bullion banks and money center banks, subtly supported by the Fed's Exchange Stabilization Fund (ESF). The motives are: 1. Profit by the banks who "borrow" gold at 1% and buy paper at 5% or more, 2. The "strong dollar" policy, which requires a quiescent gold price to validate the value of the dollar. The means are: 1. Official sector gold sales and loans, 2. The assurance (in the form of a wink and a nod) that the Fed/ESF will make good any risks taken by the big banks. 3. Large forward sales of future gold production ("paper" gold) by foolish mining companies who think they are protecting their future by "hedging." The result is: 1. A HUGE net short position on gold by bullion banks and especially JPM/Chase and Goldman Sachs (the Fed's particular accomplices in monetary policy), 2. The ability to sell official sector and "paper" gold with impunity into any gold price rally. 3. Immense profits for the banks borrowing a declining asset to fund other asset purchases. 4. "Proof" that their is no inflation and that the dollar is strong, since the gold price is not rising against the dollar despite running the printing presses full speed. Reliable analysis shows somewhere between 7,000 and 12,000 tons of short gold contracts in existence. That is several YEARS of world-wide gold production. The short position has become so huge, that now the official sectors have to help suppress the price in order to maintain "stability" in the gold market (and to maintain some hope of getting their gold loans eventually paid back). This stuff is not "conspiracy-nut" theory, it is just another facet of Easy Al's keeping the bubble inflated. It is well documented and analyzed at the GATA.org website. GATA (Gold Anti-Trust Association) is funding a lawsuit against the Bank for International Settlements in which most of the specifics of the price manipulation are made clear. I believe further investigation along the lines I have suggested will clear up any cases of "amazement" about the bizarre behavior of the price of gold. Thanks for all the good commentary, /Kit

To: Earlie who wrote (88364)	1/12/2001 9:45:24 AM
From: Oblomov	Read Replies (1) \| Respond to of 132070

In what sense does the Euro have "no baggage"?