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

To: russwinter who wrote (31693)	10/20/2004 10:35:30 PM
From: jimsioi	Respond to of 39344

Great reference, Russ, was yours of Leonard Kaplan Good explanation of the funds' drive and limitations... Leonard is still a metals bear as revealed by this quote: "the Euro is a warning signal that the trading range in gold may soon be broken. Another worrisome signal is the continuing price of oil, as gold has most certainly “picked up a bid” from those investors who rightfully understand that high oil prices will create an inflationary bias in the economy. " Worrisome ??? Not so if you're long... Looks to me like lower 10yr rates are driving these metals as much as anything... stockcharts.com How do longer term interest rates fall if inflation is a concern...people hedging bets...Long notes and bonds and long Silver and Gold...?

To: russwinter who wrote (31693)	10/20/2004 11:56:52 PM
From: LLCF	Read Replies (1) \| Respond to of 39344

<<These “black box” computer systems have no concern about the fundamental supply/demand considerations at all; they carry no concern about news events or governmental statistics, all they look at IS THE PRICE. And since it seems most trade quite similarly, and with billions of dollars behind them, many of the price movements seen in the market are just self-fulfilling prophecies.>> Interesting how things are always true in so many more ways than one... like general laws of nature that repeat themselves. In this case the exact same thing goes on in the macro level as the trading level, where the population as a whole has given up rationality for the 'equities for the long run [regardelss of price or situation]' mantra rules. DAK

To: russwinter who wrote (31693)	10/21/2004 11:41:16 AM
From: jpthoma1	Read Replies (1) \| Respond to of 39344

Nice document. I would love to hear about his sources when he says Indian demand for gold is strong. JP

To: russwinter who wrote (31693)	10/22/2004 3:27:18 PM
From: Proud Deplorable	Read Replies (2) \| Respond to of 39344

Russ, in all the years I've followed metals I've learned not to pay attention to Kaplan but hey that's just me. I stopped reading him ages ago. Is there any solid reason why I should alter this opinion? These guys are mostly responsible for their predictions becoming self fullfilling prophecies and so when I see the idiot funds unloading I just assume that someone opened his big yap with more rubbish because these fund managers can't think straight anyway and jump if they see a mouse cross the floor. I know because it takes one to know one >G< I just wait for it to blow over and I'm fine.

To: russwinter who wrote (31693)	10/23/2004 3:18:04 AM
From: Ken Reidy	Read Replies (4) \| Respond to of 39344

It is late and I am sleep deprived but Leonard Kaplan has this all wrong....I'll try to rework his comments and let you decide what makes more sense. The complete irrationality of the large Commercials dominates most trading venues. This was seen recently in the copper market, where prices fell by almost 24 cents in just four trading days despite rapidly dwindling copper inventories and soaring Chinese demand for Copper. We have seen this phenomenon many times, where large speculative funds drive prices to completely reasonable levels based on fundamentals only to discover the Commercials have seemingly unlimited funds which allow them to never have to cover their short positions. The Commercials increase their short positions until it becomes obvious to the specs that the Commercials will not cover their shorts so the specs liquidate their long positions rapidly to try to lock in their profits. Most successful Traders, including Jesse Livermore continue to add to their positions as prices move in their favor. A rational human, who purchases gold, lets say at $400 per ounce, would recognize that at $410 the commercial shorts should be starting to sweat and would add to their position while at the same time raising their stop loss. This is the EXACT OPPOSITE of how the large commercials trade. The Commercials continue to add and add to their short positions, where by definition, they carry the largest short position at the very top of the market. It is totally illogical to add to a losing position but the large Commercials do so because they seem to have unlimited funds with which to increase their short positions with. The fact that they swing billions of dollars around, creates massive volatilities in the market, and many market moves are simply the result of the Commercials order flow as opposed to market fundamentals. The Commercials have no concern about the fundamental supply/demand considerations at all; they carry no concern about news events or governmental statistics, all they look at is how large the specs long position is because they know they have the resources to outlast them and run the specs' stops. Realistic and careful analysis of the fundamentals of many commodities seems to be no longer valuable in ascertaining value in many of the commodity markets. The deep pocket Commercials have been able to keep commodity prices far below their inflation adjusted peak prices of decades ago because the central banks of the world line their pockets with the resources to do so. Commodity demand is soaring worldwide and commodity supplies have been greatly diminished, yet commodity prices struggle dramatically to reach their inflation adjusted prices of decades ago. All that you really need to know is that the Commercials basically have a blank check to protect the paper fiat currencies of the world form becoming hyperinflated and eventually worthless. Please give this some thought as it pertains to the Commitment of Traders reports, as the Spec funds tend to be right almost all the time, but it doesn't matter as the game is rigged. Well, let’s be more concise, the Specs will “ultimately” be right, when physical demand overwhelms the Commercial shorts and the Commercials' finally fail in their attempt to artificially depress the prices of commodities. I think Kaplan is out to lunch and I hope my little edit job shows just how out to lunch he is. He is definitely biased against Gold and I stopped reading him long ago. Obviously I am biased for Gold....which I believe is appropriate given the fundamentals....i.e. massive debt everywhere the eye can see. His comment that..."Another worrisome signal is the continuing price of oil, as gold has most certainly “picked up a bid” from those investors who rightfully understand that high oil prices will create an inflationary bias in the economy." is laughable. He needs to study the historical Gold/Oil ratio and he will find that Gold is very undervalued compared to Oil right now. Then he goes on to state that "the fundamentals of silver dictate lower silver prices, the large speculators certainly have the ability to push prices higher, for a time." Wow....what is he looking at?...he is misguided. Silver's fundamentals are white hot right now.....the price should be much higher as it has been artificially supressed for years, according to Ted Butler and Dave Morgan...two people I believe have a much higher level of integrity than Leonard Kaplan does. Well, that is enough shouting from my soapbox....good night.

To: russwinter who wrote (31693)	10/24/2004 9:40:06 PM
From: Chaka	Read Replies (1) \| Respond to of 39344

Even with gold holding firm in the last few months, the strength of Indian gold demand continues to surprise most analysts. In the past 5 months, most of the increases in the price of gold has been offset by the increase in the rupee, from under 43.5 in April to roughly 46.0 at present. This is a major contributing factor to continuing demand and total imports of gold into that nation could total 880 tons this year, up some 10% over last year. As the economy of India continues to thrive, it is likely that the currency will follow, and thus also likely that gold imports will continue to rise. Please remember that gold buyers worldwide think in terms of their own currency, and not in terms of gold in Dollars. A higher rupee makes it cheaper for Indians. As an aside, Indian households hold about 15,000 tons of gold, over 10% of total world above ground supply. The basic premise in this paragraph is patently wrong - the rupee depreciated from 43.5 rupees to 1 dollar in April to 46 rupees to 1 dollar! -CK