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To: steve susko who wrote (81295)	3/16/2001 7:59:26 AM
From: Box-By-The-Riviera™	Respond to of 436258

agreed. but he also owned a total of 8 million before his sale. Please let me know what you find out after your call to the company. TIA J

To: steve susko who wrote (81295)	3/16/2001 8:26:12 AM
From: Box-By-The-Riviera™	Respond to of 436258

here's a guy who got the BOE auction correct before the event.... By Anne Brady Of DOW JONES NEWSWIRES PHOENIX (Dow Jones)--Shares of gold producers are gleaming this year, even as stock market woes continue in a variety of other sectors. However, veteran fund manager Frank Holmes says investors should watch their steps before going for the gold. Some major gold stocks are up this year because of concerns about inflation, the flight from dot-coms and, more important, because the price of gold leases charged by banks suddenly has soared, said Holmes, chief executive officer of San Antonio's U.S. Global Investors Inc. Several weeks ago, lease rates were about 2%. Today, it costs as much as 7% to borrow gold. "One has to be cautious. You can be fooled again," said Holmes. "If lease rates fall, gold will fall." Partly because of his cautious approach to investing, which involves shunning companies with high exposure to volatility in the market, U.S. Global Investors' Gold Shares and World Gold funds haven't enjoyed the stellar returns some other gold funds have this year. U.S. Global Investors Gold Shares and the World Gold fund are both up a little more than 3% year-to-date, while other gold mutual funds are up 8% or 9%. Excluding 2001, the average gold fund has been down 16.2% a year over the past five years. U.S. Global Investors' funds have fared even worse than average. Holmes said, however, that his funds will succeed through investment in companies with "real value" - solid profit margins and cash in the bank. "I'm trying to reposition the portfolio so we can participate short-term and perform long-term," he said. "We feel these rallies are short-lived. We're not bullish on gold." Companies participating in the recent rally have included Newmont Mining Corp. (NEM), with shares up about 20% in the past month; Freeport-McMoRan Copper & Gold Inc. (FCX), up about 70% year-to-date; and Homestake Mining Co. (HM), up about 50%. "We are not holding those companies with big risk," said Holmes. He noted that his funds don't hold shares of Newmont, which he described as having "financial problems." "Newmont needs gold prices of $300 (an ounce) to solve those problems," Holmes said. "If the price of gold goes to (and stays above) $300, then we were wrong on that stock." There are companies that are moving up with the gold-stock market and that also meet U.S. Global Investors' strict value requirements. Holmes said he likes Harmony Gold Mining Co. Ltd. (HGMCY), which is up almost 30% in the past month. He also likes Iamgold Corp. (T.IMG), which he has identified as a "very low-cost producer" that is ripe for acquisition, at perhaps as much as twice its current market capitalization. The stock is up about 25% in the past month. Holmes said part of his gold stock-picking strategy is to keep an eye out for companies that may be acquired at a premium to market cap. He predicts it will "take another year of mergers" before gold prices settle above $300 an ounce. Holmes pointed to Wednesday's upcoming gold auction in London as an important indicator of where the market is heading. The Bank of England will sell 25 tons of gold, the final sale in the bank's current series for this fiscal year. Some are expecting the auction to benefit from the upsurge in prices, but Holmes thinks it may signal a halt to the rally. For each 1% gain in the price of gold, mining shares typically gain 3% to 5%. This year, however, the stock gains have more dramatically outpaced those of the metal. The CBOE Gold Index of stocks in the sector is up 30% since the end of 2000, compared with an 8.8% decline in the Standard & Poor's 500 Index.