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

To: Square_Dealings who wrote (73409)	7/14/2001 1:10:43 AM
From: long-gone	Respond to of 116753

THE IMPACT OF MARKETS -------------------------------------------------------------------------------- GRAPHIC: Globalization: The Impact of Markets These men are gold miners--protesting against massive layoffs that have cost fifty thousand jobs and put a hundred thousand more at risk. They’re victims of the fall in the price of gold, largely a result of unregulated speculation in the gold market thousands of miles away. Finance Minister Trevor Manuel. TREVOR MANUEL: Issues of timing are exceedingly important. Some of the circumstances leading to the price fall last year could have been prevented. In 1997, false rumors spread that European Central bankers were about to sell their massive gold reserves. This sent gold prices plummeting. Central bankers didn’t sell, but they also didn’t use their powerful voices to quash the rumors. So, others sold and speculators rushed in to buy. With falling gold prices, thousands of South Africa's gold miners found themselves out of work. And those that remained faced an uncertain future in the weakened gold mining industry. Union leaders convened a summit to address the crisis. One of those invited was Bobby Godsell who represents the mine owners of South Africa. BOBBY GODSELL: I think everybody in this room is united by one powerful common interest-- we're here because of the crisis in the South African gold mining industry. Godsell placed blame on the gold speculators. GODSELL: Short terms speculators are making money on pushing the price of gold down on the threat of central bank action. Union leader Gwede Mantashe. GWEDE MANTASHE: We are losing 500 workers a day and that is actually a disaster. Gold and diamonds built the South African economy. For nearly a century, a poorly paid, mostly black work force labored miles under ground under dirty and dangerous conditions. One miner is said to have died for every ton of gold ripped out of the earth. The mineworkers were among the first to build a militant union to better their conditions. It became a driving force in the struggle against apartheid. But even the new democratic government the miners helped bring to power is almost powerless to help them. With over 32% unemployment, these are hard times at the mines. C. HUNTER-GAULT STANDUP: These men are standing in line to cash their monthly paychecks. Each makes on average about $130 per month for work deep down underground in these mines. But there is also great anxiety because none of these men is exactly sure just which of these paychecks is going to be his last. Miners accuse the owners of using the gold crisis as an excuse to shrink their labor force and to mechanize production in the name of global competitiveness. South African Deputy President Thabo Mbeki says his country is not unique. MBEKI: You are seeing a real consolidation of economic power in fewer and fewer hands. It's an outcome, a reflection of, and also a cause of this process of globalization. South Africa economist Azar Jamine says this trend is deepening inequality. AZAR JAMINE: There can be little doubt that the financial world internationally and in South Africa as well just doesn't seem to have any communication with the wants and aspirations of the people–the ordinary man in the street. They are totally engrossed in the quest for profit and I'm afraid to say that ultimately the backlash that may be encountered against the resultant increase in inequality could bring down the very financial wealth that is currently being created by a few. The gold crisis is only one of the downsides of globalization. TUTU: When there are millions starving, I think that there must be something fundamentally wrong. South Africa’s Nobel Laureate Archbishop Desmond Tutu adds a moral perspective. TUTU: I do not buy this whole business about the market, because the market isn't something that has got a total autonomy out there. The market is controlled and run by human beings. As South Africans seek a just balance between the market and morality, other Africans struggle against multi-national corporations-- another key force in the process of globalization. pbs.org

To: Square_Dealings who wrote (73409)	7/14/2001 7:30:43 AM
From: Rarebird	Read Replies (3) \| Respond to of 116753

The problems abroad is causing foreign capital to seek safety in U.S. Treasuries - this is contributing to the unusual strength of the U.S. dollar. All post-war economic recoveries have been accompanied by a weakening dollar and this time I do not expect the situation to be any different. A strong dollar is not what the U.S. economy needs right now. An economic recovery would clearly benefit both equities and gold. It's been said that "Gold does well in periods of extreme inflation and extreme deflation." Well, the inflation rate is falling and falling fast. Perhaps the U.S. economy will eventually see a period of extreme deflation. But it is not here yet. This is what I do see: The Asian Markets have been extremely weak. The difficulties there are due to a slowing of the U.S. information technology market and a renewal of economic deterioration in Japan. With the U.S now experiencing a genuine slowdown, the engine driving the Asian markets has been set in reverse. Exports in Asia have massively collapsed with year-to-year export comparisons down over ten percent in Taiwan, Philippines, Singapore & Korea. Europe is not faring much better and Germany is on the verge of entering a recession. The chances IMHO of Asians or Europeans exchanging U.S. Dollars for Gold are extremely slim. Actually, CB's around the World are continuing to sell Gold and buying U.S. Treasuries with the proceeds. To get this process to reverse would require the growth rate of the U.S. economy to fall well below that of its European and Asian counterparts. The global economic system has been set up in such a way where unless a money fund default or derivative blow up emerges in the U.S., this will probably not occur. All in all, the economic data is fairly inconclusive. On the negative side, information technology bookings have been plunging and capital goods orders remain weak. More disturbing are lower U.S. exports. Tech inventory levels also remain relatively high. The most positive piece of data is that the PMI rose in June back to its December level and the forward-looking orders component of the PMI index is now back at the level it was historically at in October of 2000. This indicates that manufacturing orders may have ended their long-slide. Additionally, inventory to sales ratios have decreased indicating that inventory build-up amongst non-tech firms may not be the problem it once was. Residential home sales remain strong as evidenced by macro-economic data and recent strength in the homebuilding stock I do follow, RYL, which BTW hit a new all time high yesterday: biz.yahoo.com For my own accounts, I'm looking to buy aggressively in October for some kind of eventual recovery in 2002. To be successful as an investor and trader, it is essential that one think and analyze the economic data for oneself and shield oneself from all the noise that comes from the media and financial threads on the Web. I'd like to wish everyone a great weekend from the Jersey Shore, in Belmar. Praise Human Creativity and Independent Human Thinking. There is nothing higher nor more beautiful in the Universe than a Human Being.