Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Alex who wrote (20862)	10/7/1998 5:46:00 PM
From: goldsnow	Read Replies (2) \| Respond to of 116790

Alex, I hope you did not sell your extensive beach property in Australia..:) Japanese banks breakthrough By Tony Boyd, Tokyo Japan has finally struck a political deal to rescue its dangerously weak banking system from a collapse that threatened to trigger a global recession and systemic crisis in international capital markets. If the plan becomes law, a total of ¥57 trillion ($710 billion) in government funds will be available to nationalise banks, buy subordinated debt and common shares in weak banks and to purchase bad loans. Many details are still to be worked out, but financial markets reacted with euphoria to news of the bank deal, which came soon after the proposals by the Prime Minister, Mr Keizo Obuchi, for a new fiscal stimulus package to revive Japan's moribund economy. The yen was sharply higher against the $US, which tumbled more than ¥8 yesterday to be trading about ¥124.50 last night. Tokyo's benchmark Nikkei 225 index also surged, jumping 803.97 points, or 6.17 per cent, to 13,825 – its biggest gain this year. The surging yen also helped the Australian dollar stage a remarkable rally, soaring to a two-month high in early European trading last night. The $A gained more than US2.5¢ to be trading about US62.10¢. It ended local trading at US60.58¢, compared with US58.55¢ previously. Banking stocks led the Tokyo market surge – especially weak banks said to be facing capital shortages because of problem loans and unrealised stock losses – with Fuji Bank and Sakura Bank both rising about 20 per cent. The only exception to the buying spree was the Long-Term Credit Bank of Japan, which will be nationalised and broken up. "This plan will ease the tension in the global financial market and I think it is the outcome desired by the United States," said Mr Susumu Kato, the chief economist at Barclays Capital. "Everything changed after the G7 meeting and suddenly Japanese politicians started to think in terms of crisis management." A two-month political deadlock over the bank rescue was broken late on Tuesday night when the ruling Liberal Democratic Party struck a deal with the New Peace Party and Social Democratic Party in Japan's Upper House. In teaming up with the two Opposition parties, the LDP was able to bypass the Democratic Party of Japan which had demanded greater disclosure of problem loans, tough new loan loss reserves for risky second category loans and market valuation accounting of stock losses. All these tough provisions have been set aside. The Democratic Party leader, Mr Naoto Kan, and the Opposition Liberal Party leader, Mr Ichiro Ozawa, said they would vote against the new law. The Democrats had demanded that only banks which failed to meet the minimum international Capital Adequacy Ratio of 8 per cent should be able to get government funding. But under the LDP's latest plan, any bank that has a capital adequacy ratio higher than zero will be able to apply for government funding in the form of shares or subordinated debt. A total of ¥10 trillion will be set aside for this purpose. A bank with more than 8 per cent capital adequacy will be able to access this pool of government money on three conditions: •If it is about to take over a failed lender as part of a rescue or merger. •If it needs fresh capital to deal with its own restructuring. •If it requires funds because of a general lack of liquidity or to avoid a deflationary spiral caused by a credit crunch. A further ¥30 trillion will be available to either nationalise banks or buy common shares in "extremely under-capitalised" banks. • New rules, slow progress • $A rallies as Europe's rates fall afr.com.au

To: Alex who wrote (20862)	10/7/1998 6:07:00 PM
From: goldsnow	Respond to of 116790

Gold fails at $300, A$ rise lures miner buying 12:28 p.m. Oct 07, 1998 Eastern LONDON, Oct 7 (Reuters) - Gold failed to breach $300.00 resistance in heavy trading on Wednesday despite support from producer-related gold buying on the surging Australian dollar, dealers said. ''The only real impact on gold was down to the Aussie dollar's rise, which took the Aussie gold price right down,'' said one London dealer. London gold fixed at $298.00 a troy ounce in the afternoon, down on the morning's $298.85. Spot gold was last at $297.70/$298.20, $1.70 up on its previous New York close, having nosed briefly above $300.00. Another London dealer described Australian miners as having acted like proxy bullion dealers on Wednesday, buying back cheaper gold in Australian dollar terms to profit from earlier sales made above A$500. ''There are miners who are quite frankly jobbing the market, playing the dealers' game,'' he said. Australian dollar gold reached a 2-1/2-year high last week near A$510/ounce before Wednesday's surge versus the U.S. dollar knocked local gold prices to a one-month low near A$480/ounce. Many gold miners sell forward some or all of their future production to lock in delivery prices, profiting when the gold price drops during the life of the forward contract. When miners trade their futures positions more frequently by, for example, buying back hedges to cash in profits, they move closer to the realm of pure gold dealing. Gold's failure to make more progress in U.S. dollar terms, despite the unit's weakness versus other major currencies, left one of the dealers unimpressed. ''The big-figure move in the yen has equated effectively to nothing in gold, which is not that impressive,'' he said. Dollar gold prices have intermittently tracked dollar/yen and dollar/mark moves in recent months, using both as rough-and-ready pointers to non-U.S. gold demand. Silver was last softer, having failed to track gold, trading three cents lower versus New York's Tuesday close of $5.10/$5.13. Strikes at two of South Africa's platinum producers firmed prices from Tuesday's early London fix at $340.00, a five-and-a-half year low, but failed to ignite any price rally. Lonrho Platinum said its West Plats mine remained strikebound on Wednesday, two days after 6,000 unionised workers downed tools in protest against the sacking of 10 employees. A strike at the Impala Platinum Holdings Ltd (Implats) refinery complex also remained in force despite Monday's framework deal, amid continuing disputes over disciplinary procedures. Platinum was last firmer at $346.00/$348.00 a troy ounce, $5.00 up on New York's Tuesday close, while palladium was unchanged at $280.00/$285.00. ((Patrick Chalmers, London Newsroom +44 171 542 8057. london.commodities.desk+reuters.com)) Copyright 1998 Reuters Limited