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Gold/Mining/Energy : Precious and Base Metal Investing -- Ignore unavailable to you. Want to Upgrade?

To: Stephen O who wrote (145)	10/12/2001 4:37:43 AM
From: paul ross	Respond to of 39344

fiendbear.com

To: Stephen O who wrote (145)	10/12/2001 9:41:02 AM
From: russwinter	Respond to of 39344

More of the "death of metals" genre: Credit Suisse First Boston Quits London Gold Fix By Vladimir Todres London, Oct. 12 (Bloomberg) -- Credit Suisse First Boston quit the London gold fix, an 80-year-old institution that sets the benchmark price of gold, as part of a plan to curtail trading in precious metals. The company will stop making markets in precious metals, it said in a statement. CSFB was one of five banks that meet twice a day to set a price in London's gold market, which totals $266 million a day. Gold has lost its allure for investors seeking protection from turbulent markets. The metal, now at $285 an ounce, is near a 28-year low after adjusting for inflation. It has risen only 4.4 percent since the Sept. 11 attacks on the U.S. CSFB's departure ``highlights how dead and small the gold market has become,'' said Ted Arnold, an analyst at Prudential Bache. ``Gold has no promise. There's no better evidence than that.'' Simon Ford, a managing director who ran the bank's precious metals business, declined to comment, including on whether he will stay at CSFB. The move comes after CSFB this week announced plans to slash 2,000 jobs as new Chief Executive John Mack attempts to reduce costs after a third-quarter loss of $120 million. CSFB employs some 40 people in precious metals. Business to Close CSFB in a statement said it will close its London, New York and Sydney precious metals market-making and structured derivatives, clearing and vaulting businesses. It will also resign from being a market-making member of the London Bullion Market Association, thus ceasing to provide continual prices. ``I'd expect them to carry on clearing operations for some time,'' said Susanne Capano, LBMA spokeswoman. ``You can't stop that overnight.'' Gold prices in London were recently up $2.10 at $283.75 an ounce, marking a gain of 4.1 percent so far this year. CSFB said it will remain an ordinary member of LBMA. ``CSFB will continue to be active in the market in order to manage, maintain and satisfy all existing long-term hedge contracts with gold and silver producers,'' the bank said. It said it has ``no net hedge or market position.'' Analysts estimate CSFB's total gold positions at some 12 million ounces. Seat Dropped CSFB decided to drop out of gold fix sessions 17 months after it bought a seat among the five-member group of banks. Besides HSBC Holdings Plc, the group includes Deutsche Bank AG, Bank of Nova Scotia-ScotiaMocatta and N.M. Rothschild & Sons Ltd., which chairs gold fixing. ``CSFB's departure doesn't undermine the importance of the fix,'' said Simon Weeks, head of gold trading at ScotiaMocatta. ``The fix mechanism is what is important, and it's in place and is continued to be used by the market.'' Bankers and traders consider the session as the most reliable price indicator for the over-the-counter gold market because the biggest market makers take thousands of orders to the fix, testing the depth of the market before setting the price. ``I believe CSFB's seat will be sold,'' Weeks said. He declined to name possible buyers. CSFB didn't comment on when and to whom it may sell its seat.