We ask you, why would anyone own Barrick, Placer Dome or AngloGold in this gold bull market? If you own them sell them, because they are really starting to under-perform in a big way. Instead buy *Agnico-Eagle (AEM-NYSE), *GOLDCORP (GG-NYSE) and Newmont (NEM-NYSE). Before this is all over, all three of these stocks will be selling at over $400 a share. Just think what these three would do if Barrick, Placer Dome and AngloGold became the next Enrons.
Fear of real problems due to hedging is being reflected in the share prices of Placer Dome, Barrick and AngloGold. Many see an eminent short squeeze in the works as Japanese and other buyers wipe available physical gold off the market. Gold production is falling and there has been little exploration for years. The production to demand shortfall is 600-1,000 tonnes a year -and that is without investment demand. Mine supply will drop in the years ahead and producers are not capable of major increases in production. Not only will hedges have to buy in short positions but also they won't be sellers cutting off supply to market. A double whammy upside effect will hit the market. Over the next six months and perhaps even over the next month gold will breakout and that's all she wrote. You must set your positions now in gold and silver, coin, bullion, stocks and commodities. Don't be left behind.
The United Steelworkers Union at Barrick's Kirkland Lake Holt-McDermott Mine will go on strike. Barrick flat refuses to talk to them. Sell your Barrick shares and buy *Agnico-Eagle (AEM-NYSE) and *Goldcorp (GG-NYSE).
Rumors persist that two international gold stocks are closing out hedging positions. That would add to gold's strength. The underwater level for Barrick is $310, Anglo gold is $300, and Placer dome is $345 an ounce. Gold prices above these levels respectively mean losses for these producers. You can bet they are concerned. How anyone can buy these hedged vehicles is beyond us. We do not believe these three are covering as yet. It could be Newmont and Ashanti. As you know, from last week's comment, Ashanti is in deep trouble again with the guidance and assistance of Goldman Sachs. Once the gold price firms above $300 an ounce, major buying will come in from Europe and then as the price climbs the hedgers and shorts will cover adding upside velocity to the move. Not only will hedgers be buying, but also they won't be selling, which gives a double effect to the upside. We believe shareholders of Barrick, Anglo Gold and Placer will be buried, because they are still selling trying to keep the price down. They have to be insane or recipients of government guarantees. We don't put anything past governments.
We also find it of great interest that Brian Mulroney bought 237,000 shares of Barrick via options and Jamie Sokolsky 37,500. Sokalsky is CFO and Mulroney is a Director. They immediately sold their shares. They obviously know something that we don't know. That left Mulroney with 1,000 shares and Sokalsky with none. That's a great vote of confidence for Barrick.
Ashanti Goldfields, Africa's fourth largest producer, may shut down if it does not restructure its debt. This is the firm that had to be bailed out not so long ago. They are still short through their hedging program that they never fully covered. How stupid can you be? Then again Goldman Sachs is their advisor. Our question is who's next, Barrick, Placer or Anglo Gold?
Another reason to be careful in owing a few South African mining shares, Anglo American, Implats and Gencor will be sued and responsible for billions of dollars in claims surfacing regarding asbestos-related diseases. This will not only cost a lot of money, but it also will affect their credit ratings. If you own them, sell them, before the crowd catches on.
Again, don't forget there are only $35 billion in gold shares in the markets. And when the public discovers the truth, you will see the biggest gold share run in history. This is our 42nd year and we've been there and done that. Buy for the wildest ride of your life. Only 15% of investors will participate and you want to be in that select group that comes out of this financial inferno wealthily. 99% of investors don't have a clue as to what is going on and only a few will be fortunate enough to understand what is really going on. Their brokers certainly won't tell them. This is still really just the beginning.
Istanbul's Gold Exchange weekly report puts imports at 4.7 tonnes or 23% higher than least week.
Malaysia's PM Mahathir Mohamad has proposed that a gold dinar be used for international trade to prevent a repeat of the currency crisis, which devastated Asia in 1997-98. This would thwart currency traders and others tying to manipulate markets. The dinar is 4.3 grams of gold. It would be used for international trade only. This would lead to more balanced globalization and be a check on economic bullying practices made in the name of free market and portfolio flows. The implication is that the elitists run world finances and trade to suit themselves. The proof of that is the manipulation of all markets for the benefit of the few. Western governments are selling gold to perpetuate fraud.
As we reported previously, just to remind you, FED officials were concerned that short-term interest rates were so low that monetary policy would be rendered ineffective. Thus, they have proposed considering unconventional policy measures to boost the economy, which includes buying stocks. The Bundesbank has proposed the same by selling gold in 2004. The FED could theoretically buy anything to pump money and credit into the system, state and local debt, real estate gold mines, and any asset. What they have left unsaid is that they have been doing this for sometime, and they have lost control. There are no free markets. We live in a fascist America.
The Japanese public continues to struggle about what to do regarding their savings. Time deposits at the five largest banks are off 6.4% year-to-year, the steepest decline ever. Large amounts of deposits are being moved from weak to stronger banks and a small portion into gold. There is still a possible $500-$700 billion that could end up in gold. We have only seen a tiny movement of funds into gold - and we believe much more will follow as the depression deepens and gold rises.
Compounding matters is that to seasoned professionals it is now evident that the gold cartel and central banks are running scared as borne out by their desperate announcements of future gold sales. This has got to bring serious money into gold. They recognize a wounded animal when they see one.
Judge Reginald Lindsay in the U.S. District Court in Boston has dismissed the Reg Howe lawsuit, regarding gold manipulation. We know our Congress has been purchased, our executive is an extension of international elitism and now we know we have no redress in the legal system. That leaves us with but one alternative. When the window of opportunity opens be sure to take advantage of it.
We have discussed the possibilities of this outcome with Bill Murphy and we recommended a campaign of exposure. We can get no media exposure so the alternative is to demonstrate with signs in front of all federal facilities and in and around Wall Street. That would entail placards saying the gold market is being manipulated and who is responsible. That certainly would let millions know that criminal activity controls the gold market. We welcome other ideas, so we can reach the public.
As Bill Murphy says, the Bundesbank is pathetic. They are attempting to drive gold and gold share prices down and drive the market up. There are no free markets. They could be talking about gold sales in 2004 setting up a bailout of Deutsche Bank, which is short bigtime. Obviously Ernst Welteke precludes moral hazard. We still don't believe, upon his election, that Edmond Stoiber will allow this to happen.
The German central bank, The Bundesbank, is pathetic:
Bundesbank may sell some gold reserves March 25 2002
FRANKFURT (AFX) - Bundesbank president Ernst Welteke said the bank is considering converting a portion of its gold reserves to buy blue chip shares from 2004. "We must consider if in the mid term if we could to a limited extent and without pressurising the (gold) market convert some of our gold into equities," Welteke told the Frankfurter Allgemeine Zeitung in an interview. He said the bank would most likely buy Euro Stoxx 50 listed shares, or other standard blue chip stocks. The Bundesbank wants to manage its portfolio of gold and currency reserves more efficiently in the future, he said. The agreement between the euro system's central banks not to sell more than 400 tonnes of gold each year expires in 2004.
According to the paper the Bundesbank holds some 3,500 tonnes of gold with a total value of 35 billion euros.
Japanese firms see ninefold increase in gold sales:
Posted: 03/26/2002 08:00:00 AM | © Miningweb 1997-2001
TOKYO - Tanaka Kikinzoku Kogyo KK, Japan's leading seller of gold bullion, has reported a ninefold increase in gold sales in February compared to the same month in 2001. Asia Pulse reports ahead of the reintroduction of the deposit insurance cap in April, it has been a trend that some money in Japan is flowing into gold, according to the officials.
In addition, the deposit guarantee limit will be applied to ordinary deposits in one year. As a result, the company expects its gold sales to grow further after February, at four times the year-earlier levels. Tanaka Kikinzoku has not disclosed the actual amount of gold sales for February. But the company appears to have sold about 17 metric tons of gold in the month, judging from total domestic sales and the fact that the company has a market share of just over 60 percent.
In February, strong demand for gold in Japan pushed up international gold prices. Of people who bought gold in February, 80 per cent are new buyers, and most of them plan to hold the gold for a long time, according to the officials, said the news wire service.
April 4, 2002
THE INTERNATIONAL FORECASTER
An international financial, economic, political and social commentary.
Published and Edited by: Bob Chapman |
