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

To: Zardoz who wrote (21044)	10/7/1998 6:52:00 PM
From: cool	Read Replies (1) \| Respond to of 116872

Has there been any discussion who was on the other side of hedge fund fiasco---who outsmarted our "best and brightest" and what they are doing with their new wealth? Perhaps buying gold in Hong Kong---IMO Funny we have the same people in charge---no heads rolling---- PR NEWSWIRE) Newmont Mining Acquisition of Remaining Newmont Gold Shares Newmont Mining Acquisition of Remaining Newmont Gold Shares Declared Effective DENVER, Oct. 7 /PRNewswire/ -- Newmont Mining Corporation announced that its merger with Newmont Gold Company became effective today. Under this tax-free merger, Newmont Mining has acquired the remaining 6.25 percent of Newmont Gold Company that it did not already own. Each outstanding share of Newmont Gold common stock (other than shares that perfect appraisal rights under Delaware law and shares owned by Newmont Mining and its subsidiaries) has been converted into 1.025 shares of Newmont Mining common stock. Fractional shares will be paid in cash. Approximately 10.7 million shares of Newmont Mining common stock will be issued in the merger (assuming no exercise of appraisal rights). Newmont Gold Company, listed on the New York Stock Exchange under the symbol NGC, will cease to trade prior to the opening of the market tomorrow. The board of directors of Newmont Mining previously approved the merger. A special committee of the Newmont Gold board of directors, consisting of directors who are not affiliates of Newmont Mining, determined that the merger is fair to the minority shareholders of Newmont Gold. The merger is the final step in a consolidation process between Newmont Gold and Newmont Mining that began in 1994. Since January 1, 1994, the two companies have had the same per-share assets, operating results, earnings and dividends.

To: Zardoz who wrote (21044)	10/7/1998 8:19:00 PM
From: E. Charters	Read Replies (2) \| Respond to of 116872

Growth is high but inflation is compounding. IF you take just the interest rate for 70 years you get a compounding of almost 9 percent for 70 years. That is why they say JD Rockefeller's wealth of 900,000,000 in 1937 is worth 186 billion today. But of course you cannot use the interest rate, just the inflation rate which is compounded with the REAL interest rate to make the bank interest rate. The real interest rate has never changed at about 3% per annum. That is the rate at which real dollars accumulate. Take that to the 70th and you get the increase in wealth from 1929 to present. BUT you must also include taxes, as public wealth although tangible and favourable to wealth generation, is NOT included in real wealth but subtracts by a not quite one to one factor. Any way you have to make more money today because of increased government to remain in the same place today. 3 percent compounded for 70 years is 7.91 times (growth in wealth or real interest rate) 6 percent compounded for 70 years is 59 times (inflation) 9 percent compounded for 70 years is 417 times (total interest rate) Real wealth increased by 8 times, but inflation increased prices by 60 times in 70 years. And taxes increased so we have to make near 2 dollars to equal one in the past. But roads are better. So lets say the trade off is 1.5 times the money to equal the old, ceteribus paribus. So the ratio of dollars expanded to dollars grown is 7.375 to one times 1.5 or 11 times roughly. Gold was at 35 dollars 70 years ago so it should be at 385 dollars today by this calculator. Why is gold not 2100 dollars? Because there has been real growth in the economy since 1929. It looks like the 60 times should be mutiplied by the 7.91. But it isn't. The banker compounds it, it is true, but inflation is actually independant of real wealth. It does not compound real wealth but subtracts from it. This is a way of saying that inflation does not make prices rise faster than its own rate. Inflation does not proceed at bank interest rates as those rates do create increased wealth. Another way of looking at it is there is about 15 perhaps 20 times too much speculative money being lent by banks to no production speculation in foreign governments, enlarged civil services, overbuilt militaries and generally dead end money. When a business man gets a good idea to start a business he is routinely refused by banks according to a narrow arbiter of worth. But let a foreign goverment buy too many f16's and they cannot feed their people. Well throw 20 billion at them and that is a write off. Or some hot shot derivative whiz kids have a theory about how to double money every year? Why of course lend them 10 billion as they can speak professorese. Is gold worth 2100 or more? Well it might be. But it aint. Is its residual value 2100 dollars? Again, it is hard to say. The economies of today are irresponsible. There is terrible hidden inflation. But the exact calculator is hard to divine. The M1 is way way too high. And much is used irresonsibly and wastefully. Banks cannot figure to loan to businesses. It is not their area of expertise. Why they are allowed to create money I will never know. Overall I would say the phony money supply is about 20 times inflated. I would have to say by that that gold should be worth about 700 dollars. EC<:-}