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

To: Dwight Taylor who wrote (18569)	9/12/1998 10:16:00 AM
From: Giraffe	Respond to of 116764

Gold prices affected by US crisis By Kenneth Gooding and Paul Solman Gold yesterday continued to be caught up in the financial markets' turmoil created by the threat that Bill Clinton, US president, might be impeached. Its performance closely followed the ups and downs of the dollar and US share prices, moving above $296 a troy ounce at one stage, following the $7 rise to $290.50 on Thursday. As US share prices recovered, gold fell back to close in London up $2.80 an ounce from Thursday's close, at $293.25. Dealers suggested there was selling by traders and producers and some short covering as the price attempted to reach $300. Also, many gold market participants opted to square positions ahead of the weekend because all markets were on tenterhooks over the expected release of independent counsel Kenneth Starr's report on the Clinton sex scandal, traders said. News that the Czech central bank had sold 31 tonnes of gold this week was brushed aside. "The tonnage is pretty small and is unlikely to have a disastrous effect on prices," said Kamal Naqvi, analyst at Macquarie Bank. "The concern now is that there may be other emerging countries that may sell gold." The Gold Fields Mineral Services consultancy predicted that gold's price would average $279 in the second half of this year and would range between $250 and $300 next year. There was "an amazing 160 per cent" rise in scrap supply in the first half, compared with the same period last year, to 708 tonnes, because of distress sales in Asia. GFMS said that without these sales, the price would have been above $300. Oil prices ended the week little changed after the International Energy Agency said it saw average world demand for the fourth quarter of 1998 at 400,000 barrels a day below its previous estimates at 76.8m bpd. This was attributed to falling demand from Asia and Russia. In late trading in London's International Petroleum Exchange, benchmark Brent crude for October delivery was $13.22 a barrel, compared with Thursday's close of $13.27 and last week's finish of $13.39. Financial Times

To: Dwight Taylor who wrote (18569)	9/12/1998 10:21:00 AM
From: Giraffe	Read Replies (2) \| Respond to of 116764

US DOLLAR: High-flyer hits turbulence The US dollar could only go higher, according to the consensus earlier this year. Indeed, its strength threatened to create a new Asian upset involving a Chinese devaluation. When Robert Rubin, US Treasury secretary, ordered the sale of dollars to support the yen on June 17 the rate was 143, already down from 146 because the intervention had been rumoured. The timing was good, and the dollar fell below 136, but the impact was only temporary and the rate rose to 147 on August 11. Now, though, the dollar has decisively plummeted, dropping 12 in eight trading days, taking the pressure off various pegged currencies, including China's. Whatever has happened to the dollar's safe-haven credentials in only three months? The D-Mark, supposedly in line to become a victim of the Russian troubles, has appreciated by 5 per cent against the dollar in two weeks. The bolt-hole merits of the Swiss franc have once more become appreciated, and it has risen 9 per cent in two months. Safe-haven flows out of Asia over the past year have masked the underlying weakness of the US currency. Now, however, the merest hint from Alan Greenspan, Federal Reserve chairman, of a cut in US short-term rates has accelerated the dollar's slide. The stock markets, in contrast, have seized on the prospect of lower rates with desperate enthusiasm; but the Fed may not actually have much downside flexibility. Should we take note of neighbouring Canada, where rates rose 1 per cent on August 27? This is a different situation, and yet it is important to bear in mind that more than half of US exports go to weak currency areas in Asia, Latin America and Canada. The US balance of payments deficit is already running at an annualised $200bn and is rising fast. This has to be paid for. One former important source of financing - foreign central bank holdings of Treasury securities - has already gone into reverse, reflecting the Asian crisis, with net sales of $80bn over the past 12 months. No matter - private sector flows from Asia into dollar bonds have doubtless meanwhile been strong. But the big foreign purchases of US equities ($66bn in 1997, and at a still higher annual rate in the first half of 1998) now look suspect too after the stock market's correction. Temporary factors have exaggerated the dollar's recent weakness. Hedge funds beset by margin calls have been hastily unwinding their yen-carry trades, involving the purchase of yen and the corresponding sale of dollar assets; and Japanese banks may be engaged in their half-yearly exercise of repatriating foreign assets to shore up their end-September balance sheets, though it is hard to see why they should bother to pretend. Meanwhile, Europe, which is running a comfortable balance of payments surplus, may have to adjust its plans. A moderately weak euro would have enabled the European Central Bank to edge interest rates higher and address some of the potential problems of the overheating "bubble" states such as Ireland and the Netherlands - how convenient. A strong euro, however, might require lower rates (below today's 3.3 per cent for D-Marks) to keep the German and French economies growing, posing a threat to the regional stability of Euroland. In the short term the dollar could rally. It is impossible, however, to imagine a longer-term solution that does not involve a sizeable interest rate premium to encourage foreigners (and US multinationals) to retain dollar liquidity. There will also have to be a rise in US savings, and a corresponding fall in consumption, to reduce the deficit. You might describe that as a recession or, in Greenspanish, an inability to "remain an oasis of prosperity" in a distressed world. Financial Times

To: Dwight Taylor who wrote (18569)	9/12/1998 10:32:00 AM
From: Giraffe	Read Replies (1) \| Respond to of 116764

Kaplan didn't have much to say yesterday ... but this tidbit was interesting. I find it interesting that gold has been used in the traditional medicine of India (called ayurveda) for hundreds of years. ----- According to new research in Australia and New Zealand, as reported by the UK Press Association, compounds made from gold and silver could make good anti-cancer drugs. Precious metals drugs may be able to kill cancer cells by targeting part of the cells, known as the mitochondria, which have more highly charged membranes than those in normal cells. This research was done by Susan Berners-Price of Griffith University, Brisbane, Australia, and Mark McKeage of the University of Auckland, New Zealand. In mice these compounds could kill ovarian cancer cells which were resistant to the common cancer drug cisplatin.