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To: SirRealist who wrote (62871)	7/27/2002 8:27:41 PM
From: farkarooski	Read Replies (3) \| Respond to of 208838

Getting the gold price down was essential. But now comes <<more than your normal short squeeze for gold. It can only drop 1-2 more days before the buying kicks in. Defying standard TA, I think it can drop another 10-30% yet. (if you bought too early, either set tight stops and switch to another golddigger when it bottoms, or ride it out. My outrageous buy price for HL is $1.75-1.80, but I consider it a bargain at $2.10... by October I see it at 7 to $8.75) This would put gold, the metal, around $395 to $490/oz.>> dude, I thought HL is a silver play ... If I remember correctly it is 50% gold, 50% silver ... why don't you go with a pure gold dude ...

To: SirRealist who wrote (62871)	7/28/2002 2:56:55 PM
From: mistermj	Read Replies (1) \| Respond to of 208838

Awesome post Sir R Here is another backing you up. Why Gold is down... The-Privateer Throughout the two weeks between July 5 and July 19, when both the Dollar and U.S. markets were falling faster and faster, everyone who is anyone in Washington was insisting with ever increasing stridency that the U.S. economy was SOUND! Mr Bush insisted it was - repeatedly. Mr O'Neill insisted it was - repeatedly. Mr Greenspan insisted it was - repeatedly! Yet there was no effect. The markets kept falling. The Dollar kept falling. And worst of all, the American people began to actually take seriously the proposition that they might just be in a real BEAR market and it might just last for YEARS. The Dow falling below its post 9/11 low on July 19 (and Gold spiking $US 6.80) was the last straw for Wall Street. This time, the jawboning was NOT working. Not only was it NOT working, it was making things worse. There was only one "solution". BRING THE MONEY HOME! Starting bright and early on Monday, July 22, U.S. finance houses of all description began a desperate rush to REPATRIATE capital. They started to sell out of ALL their liquid foreign assets. The Dollar began to RISE! The next day, the repatriation became a tidal wave and one "domestic" asset was added to the mix. Gold was dumped for Dollars too, the spot future price falling $US 10.90 on the day. The Dollar SOARED, rising 1.95 points on the $US index. Finally, on Wednesday, July 24, the tide turned. Over the first two hours of trading, U.S. stock markets continued to tumble. Then, the repatriated assets were put to work. The result, to use the Dow as an example, was a 700 point intraday turnaround. The Dow closed on July 24 with its biggest single day jump in percentage terms since 1987. The longer-term consequences of this U.S. repatriation of capital is covered in detail in the Late July (#455) issue of The Privateer - published on July 28. Suffice it to say here that no nation with aspirations to empire, sole superpower status, and/or the stewardship of the global financial system via its status as issuer of the world's reserve currency, can hope to preserve its status by liquidating its foreign assets. This is particularly true when that nation also happens to be the worlds biggest NET foreign DEBTOR! What has happened this week is nothing more or less than a panic attack by the U.S. financial establishment. When, on top of that, Mr Bush himself sends out a spokesman to assure the public that the White House would take ANY MEASURES NECESSARY (should they become necessary) to preserve U.S. economic growth, the panic has certainly reached the top. Mr Bush even let it be known that these "measures" WOULD include steps to defend the U.S. STOCK MARKET. One would have to go back to the darkest day of 1931 - just before the markets REALLY cratered - to find statements like that from a U.S. President. The financial powers that be have bet the farm. The only problem is that it is NOT THEIRS TO BET - IT IS YOURS AND MINE! And as always happens in these cases, great efforts are made to BLOCK any avenue of retreat or defense. Gold was savaged. Can't have anybody thinking they can do an "end run" around OUR system. Gold stocks have been savaged even worse, especially in the U.S.. This process was given a large helping hand by Standard and Poors, who removed the two biggest Gold stocks in the world (Placer Dome and Barrick) from their S&P 500 index because they were "not American". Despite their recent falls, Gold stocks were still too big an "anomaly". They were UP for the year while every other class of stock was way DOWN. The effect of this move by Standard and Poors was instantaneous. Most large U.S. investment houses follow the indexes. When a stock or stocks is removed from an index, they SELL that stock or stocks. Voila - mission accomplished. What has changed re Gold? Absolutely nothing. Demand still far outsrips supply. Michael Kosares at USAGold reports that demand is SOARING. Mine supply is drying up. Gold's long sojourn below $US 300 has decimated Gold exploration and led to the inevitable high-grading of existing mines. And technically, while the $US Gold charts have been "dented" this week, the uptrend is still perfectly intact. Find another $US investment with a perfectly intact uptrend which is well over one year old. July 19 WAS an "historical turning point" because the level of desperation plainly shown both on Wall Street and at the White House has ratcheted up this week. Re Gold, it has reached a level which we have not seen since the metal first broke the bounds of $US 35 back in the early 1970s. Certainly, the blatancy of the manipulation this week - not just in Gold and Silver but in ALL U.S. markets - makes anything seen over the past 25 years pale in comparison. After this, even a war in Iraq will be but a pale encore. Wall Street has "fixed" its books for the July month-end statements - by selling out of their assets all over the rest of the world. What do they have left to fix their books with next month, or the month after that?. If you are angry about this blatant manipulation, we do not blame you. If you are incensed at this latest demonstration of making it as hard as possible for the individual to protect him or herself from the results of the actions of their political "representatives", we are in full agreement. If the inability to understand or the indifference of many of those around you is wearing you down, we can only say HANG IN THERE! This Gold "hit" is an eloquent demonstration of how desperate "they" have become. Yes, Gold may go even lower from here. Its intraday low for July 26 was $US 300.50. It may go back below $US 300. But the situation only becomes "serious" if the post April 2001 uptrend is breached, and as long as Gold remains above $US 290, that won't happen. The political capital expended to get the political metal back "under control" this week has been staggering. And in any conceivable REAL WORLD situation, political capital is limited. The U.S. Administration and establishment have now made it crystal clear that they are going to explore those limits like few of their historical predecessors have ever dared to do. It is going to get REALLY hairy from here on in. ©2002 The Privateer Market Letter