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

To: Ahda who wrote (16501)	8/24/1998 8:24:00 PM
From: robnhood	Read Replies (5) \| Respond to of 116762

GOLD SUCKS

To: Ahda who wrote (16501)	8/25/1998 5:57:00 PM
From: Enigma	Read Replies (1) \| Respond to of 116762

Notice the high volume and good price action on Kinross today. the point we have been discussing i.e. companies paying their expenses in devalued currencies eg Australia, Canada, S. America (?) but selling their gold for US$ is obviously not lost on some investors, and analyists (a slow and rather lazy breed) - in fact I'd venture to say that this may be the biggest thing that we on this thread have been missing, and it is right before us. Kinross owns some marginal mines - their cash cost of production is in Canadian dollars - but they are getting, $440+ Canadian for their gold. So long as they can control their costs the currency situation has huge leverage for them. Barrick has a large portion of its production in the US so the currency leverage is non existant there - however their existing and new S. American mines may provide a different picture. Don't know enough about S. American currencies and how they have fared recently. So we have a bull market in gold in some countries and a bear or flat market in others - this spells investment opportunity. Normandy which is a huge Aussie producer must be much helped by the currency situation as are the SA mines (as already pointed out on this thread) Some Canadian gas producers are going to gain when the new pipeline to the US is opened before year end because it is my information (should be verified) that they will get the US price for the gas E

To: Ahda who wrote (16501)	8/25/1998 6:07:00 PM
From: goldsnow	Respond to of 116762

Russia financial crisis Q&A 05:04 p.m Aug 25, 1998 Eastern NEW YORK, Aug 25 (Reuters) - Following is a basic summary of the recent financial crisis in Russia. Q. What has caused the crisis in the Russian economy? A. Russia's government and its banks are critically short of cash, which has slashed domestic lending and severely limited the government's and corporations' ability to pay wages or meet debt payments. Slumping prices for industrial commodities, notably oil, which sits near a 10-year low, have hammered the Russian economy. In 1997, about half of Russia's hard currency revenues came from oil and gas exports. As oil prices fall, Russia receives fewer dollars. In addition, Russia needs to reform its tax system and end widespread tax evasion, which causes large budget deficits and cuts confidence that Russia will be able to repay its debt. Q. What is the government doing in response? A. Russia on Tuesday restructured $38 billion in short-term domestic government debt, extending the maturities and lowering the interest rates. Russia last week decided to let the rouble weaken, allowing it to spend less of its depleted hard currency reserves trying to prop up the unit. On Tuesday the rouble fell 10 percent to a new low of 7.88 to the dollar. Ten days ago it stood at 6.2 to the dollar. Russia also recently suspended debt repayments for 90 days, an effective partial debt default. President Boris Yeltsin on Sunday sacked his entire cabinet and rehired former Prime Minister Viktor Chernomyrdin to oversee reform efforts. Three major banks announced they would merge and more are expected to follow. Russia last month secured a $23 billion internatioanl bailout assembled by the International Monetary Fund. Q. How big is Russia's total debt? A. Estimated in July at about $200 billion. Given the decline in the currency, that total today would be about $250 billion. By comparison, the United States federal government debt now stands at over $5.0 trillion. New York City currently owes $27 billion to creditors. The portion of debt restructured Tuesday amounted to $38 billion due to be repaid before the end of 1999. Q. Who does Russia owe? A. A combination of domestic banks and large international mutual funds and hedge funds willing to risk large losses in hopes of reaping potentially large returns Russian bonds could offer. Q. What are the consequences to the global economy if Russia is unable to repay its debt? A. Developing nations around the world have seen their currencies and stock markets tumble and interest rates shoot higher as Russia grapples with its fiscal crisis. Oil producers like Venezuela and Mexico have been particularly hard hit. Should Russia default it would likely cause moderate to severe damage to many of these same nations. Q. How will that affect the U.S. economy? A. Not much directly, since Russia's economy is very small, but a default could hurt Asian economies and indirectly hurt Japan, Canada and Mexico -- the three largest U.S. trading partners. One positive effect would be continued low commodities prices, which are keeping U.S. inflation near 30-year lows. Copyright 1998 Reuters Limited