bobworn@aol.com wrote: >

> > Subj: SPECIAL REPORT: FED Losing Control of Global Financial System

> Date: 4/16/00 11:36:56 PM CDT > From: fwgadm@ccape.net (Frank Gadman) > To: bobworn@aol.com

> > The NASDAQ continued to get pummeled today, down another 7 percent. > Oil rose 1.24 and gold is desperately attempting a major breakout.

> > What this all means is the FED is losing control of the financial > avalanche that began three weeks ago. In the next couple of months, > the dead and bloated carcasses of day-trading firms will begin to rise > to the surface like fish after a fish kill. >

> Many retirees, both early and late, along with a lot of silicon valley > soccer moms, re-entered the 'job' market in 1998 as NASDAQ > day-traders. To play this game, you usually wind up committing > anywhere from a quarter to a half-million dollars to gain entry into > this treacherous arena. > >

I have been trading commodities and futures for 20 years, and have > been skinned enough times to where it does not hurt (as much) to drop > 2 or 3 thousand in a day. This does not mean I am rich or stupid. I > stay in the game long enough to make it back plus a reasonable return > for the risk. It annualizes out to 30 to 50% on my account per year. I > treat it with respect and as a formal business - not just something to > occupy idle time or for excitement. I have a healthy respect for the > markets and they humble me everytime I think I get wise to them. >

> I tell you this because I know, first hand, the psychological > DEVASTATION huge losses create, ESPECIALLY if it is borrowed money. > Many of these folks took out home equity loans, credit card advances, > cashed in their 401Ks early, etc. Some of these individuals are now > DEBIT their accounts, which means they are completely wiped out and > now the brokerage houses and banks will be going after their > collateral, such as their houses and other bank and stock accounts to > make up the deficiency. >

> These people are in a world of hurt right now, along with the > insta-billionaires who took dot.com companies public this year. These > folks are watching their companies value deflate faster than they > expanded, however many of them borrowed and spent on the basis of > their company's market valuation - so now they are in a double bind! >

> The day of financial reckoning has finally arrived. Yes, there will be > violent swings up and down in the market, but this is how the market > will continue to extract the unearned wealth it gave so many > 'investors.' New investors, who missed the boat, will attempt to jump > in and 'buy the dips', a strategy that has worked until now. They will > be left in a pool of financial blood after only a couple of months. > The market, acting in reverse like a giant financial vacuum cleaner, > will eventually leave millions in the 'new economy' penniless. >

> The idea now is to herd money into the bond market where it will be > ripe for depreciation as the inflation rate begins to skyrocket. This > is the reason the monetary authorities are so intent on keeping the > price of gold down - because it is the one visible indicator of > monetary anxiety. >

> When gold makes it breakout and the FED can no longer keep it under > control, we will see an emergency 'New Bretton Woods' meeting to peg > the dollar to 33 grains of silver (1/14th of an ounce) or $66 per > ounce. At the current ratio of silver to gold, gold will be priced at > $3500 per ounce! >

> As unbelievable as it sounds, this is how the current IMF/World Bank > monetary pyramid will end. You will see 'debt' forgiven all around the > world except for the U.S. and the other industrialized nations. As I > write, there are protests at the WTO/IMF meeting in Washington D.C., > where monetary authorities are NOT discussing global trade, but rather > how to save the failing monetary system. >

> Visit our website frequently for additional news and commentary at > www.eprovisions.com as this historical > global financial crisis unfolds. >

> > Dr. Rod Lewis > Editor > Global Preparedness News > r

-- ... (...@...com), April 21, 2000

Answers

Gold/Silver/etc

[ECONOMY/STOCKMARKET] Weekly Gold Market Update From IP: Weekly Gold Market Update

Unperturbed by the transition of Austria into the Triple Alliance with Britain and France from where gold sales and rumors of sales have emanated, gold kicked up its heels last Tuesday by surging $10 per ounce in short order. This, just as the Dow and NASDAQ plunges accelerated, may be a portent of markets to come.

Tuesday's market reacted according to historical norms. Earlier this year and during some other recent episodes of market turbulence gold, common stocks and bonds moved contrary to expectations, as if to say, "This too shall pass." On Tuesday accumulated wisdom prevailed. Despite the speedy success of "The Plunge Protection Team" or other causes of the quick market rebound, maybe "This time it is different" for gold.

A $10 rise in gold is the equivalent of 370 points on the Dow. To be fair, on April 4th there was no public clamor for gold. Gold is still off the public's radar screen. Tuesday's was a professional market, dominated by bullion banks and others, who know that gold has not been lost to radar forever. They know that in a financial storm gold will indeed dominate the screen as it often has even long before radar was invented.

On April 8th Barry Riley, also citing the October 1998 experience, suggested in The Financial Times, "Wall Street now believes that the U.S. Government and big investment banks will always organize a rescue. But moral hazard is piling up and time is running out." In 1997, excessive speculation caused moral hazard to overwhelm the Asian markets. Then, the U.S. dollar and the securities markets of Europe and America provided havens. A similar upset in major markets would leave little alternative to gold as a monetary refuge, especially now that 55% of German's polled dislike the Euro.

Arthur Levitt, Chairman of the S.E.C. was once a principal of the embryo of Citigroup and knows a bout speculation. In addition to his query ". . . are some of today's companies really worth 1,000 times nothing?" Mr.Levitt also says: ". . . a lot of analysts we see on television recommending stocks work for companies that have business relationships with the same companies these analysts cover. Some analysts' pay checks are tied to the performance of their employers. One can only imagine how unpopular an analyst would be who downgraded his firm's best client." This is moral hazard run amuck.

As the markets calmed gold declined but for the week was up $1.50 to $279.90 an ounce. International Investors rose 0.4% to $4.88 a share. Contributing to economic discomfort may be government finances broadly defined. On its operating basis the narrowly defined Federal Government is closing in on break-even. Government Sponsored Agencies, however, as Barron's noted last week ". . . .continue to create credit as fast or faster than the Fed has been slowing it." Just three such agencies have added $500 billion of debt in the past two years. Operating on a 3% equity base it is doubtful that these agencies could have borrowed on such a scale without an implicit government guarantee.

Typically, in tranquil economic times, the agencies borrow at small premiums to the U.S. Treasury. Since January, however, the rates on FNMA ten year bonds have widened from sixty to one hundred twenty basis points over Treasuries, partly due to a market drift to quality and partly to proposals that the implicit guarantee be weakened.

These agencies were created to foster and support the home mortgage market, which now accounts for one third of private, non-financial debt outstanding. Should these agencies become unable to supply the needed credit, there is little doubt who would take up the slack.

Last week the head of a major gold mining company suggested that either a lower gold supply or increased consumption was necessary to raise gold prices. This analysis may apply to industrial commodities which are rapidly consumed but not to gold. In fact jewelry demand, which is not consumption rises as the gold price falls, and mine supply reacts only slowly to changing prices.

The analysis of gold prices is more akin to bonds than commodities because the accumulated supply is far greater than either annual demand or new supply. There is a continuous bid and asked market for bonds and gold. Their prices reflect the value that all the holders and potential holders place on all the gold and bonds outstanding.

Isn't it remarkable that the great government bond bull market of the 1980's occurred despite the greatest issuance of government bonds in history and that in 1999 government bonds fell sharply despite an absolute decline in the amount of bonds outstanding. Perception of value is the reason. To say that new mine supply or central banks sales determine gold's price is the equivalent of saying the daily bond market is priced off the new issue market, whereas the reverse is actually true. If shorting is the cause of a weak market, what explains the 1990's great bull stock market.

If lending of gold is the answer how does the dollar maintain its value when total debt outstanding is more than three times the money supply? Some of the borrowed dollars, of course, do create income to service debt. So does some of the borrowed gold. Perception of value is the answer.

In the context of the scale of the gold market, Austria's sale of 30 tonnes and prospects of small future sales loom small to the perception of the value of gold. The April 4th stock market and its potential aftermath may loom large indeed, particularly to Austria, Britain and any other potential accumulators of gold.

Harry Bingham

April 10, 2000

www.gold-eagle.com/gold_d...41200.html

-- if you snooze, you loose (snooze@aol.com), April 21, 2000.

Nah, couldn't happen. Gold is never going up again. Pulp is the new gold. If your not in the bubble, you can't make money. Stocks always go up, this is a new era. Gold is for GOLD LOSERS. LOSERS R US

NOT

-- G.L. (gl@the.club), April 21, 2000.

I have to shake my head every time I see this kind of "gold is going to skyrocket real soon now!!!!!" stuff. In fact, I didn't even read the above post. I don't have to. From just the thread's subject line, I know this is exactly the same garbage that gold mongers have been selling since CONSUMERS could buy and own it legally in the US -- about 1973 or 1974 I think -- gee, sure has been repeated for a long time -- over a quarter century -- yes, any day now...

I don't care what gold does. I don't even own any jewelery. All I'm saying is that this kind of "buy gold now! before it's too late" garbage is just another in a decades long string of hype making THE PEOPLE SELLING THIS STUFF TO THE GULIBLE RICH -- not the customers who buy gold with the hope it's going to the moon any day now. And -- as was discussed at nauseum last year, if TSHTF -- if it ever does -- gold won't fill your belly or protect your life. Beyone MAYBE a few ounces for bribes, it won't be worth as much as a pound of rice or roll of toilet paper -- so why buy it. If it's worth $5000 an ounce one day -- do you think society will be such that you can just drive down to the mall and buy a bunch of new toys and creature comforts? Would you even sell gold for money worth so little? They why even mess with it at all. If gold ever does become worth thousands of dollars an ounce, it will be worth as much as stock options in some bankrupt dot.com -- and as spendable -- people need to think thru these things instead of feeding their vain egos with fantasies of gold as their lottery ticket and people kissing the ground they walk on and telling them how smart they are. If youwant that, use your INTELLECTUAL CAPITAL to make a fortune -- THAT IS POSSIBLE THESE DAYS -- and you can enjoy the fruits of your labors -- unlike what the mad max environment where gold is worth $5000 and ounce would be like. Duh! Think! And stop being so gullible to FUD mongers and hypsters who just want to sell you and shove their propaganda down your throat.

-- anon (noname@here.com), April 21, 2000.

Good point, anon. If the shit ever hit the fan and I had the choice between a milking cow and 10 pounds of gold...I'd take the cow.

-- (another @non. here), April 21, 2000.

Anon,

If gold ever hit $5000 an ounce, how much would your extra 12 gauge be worth?

Frank

-- Someone (ChimingIn@twocents.cam), April 21, 2000.

Frank, you missed the point!

Gold can never reach $5000 an ounce. Metal will never be worth more than practical items. We live in a different economy and if things ever went south, we would rebuild using the same system. Why doesn't that compute?

-- (another @non.here), April 21, 2000.

Frank, clearly you should put that shotgun to your head.

-- (b@ng! @ end.your misery), April 21, 2000.

How much would a 12 gauge be worth?

Well today you can purchase a decent 12 for about 285 bucks.

coincedentaly(sp) an ounce of gold cost about the same.

If gold went to 5,000 an ounce a 12 gauge would be worth about the same.

Now the real ??? is how much would a cheeseburger cost?

-- (hold@the.pickles), April 21, 2000.

Another, you said,

"Frank, you missed the point!

Gold can never reach $5000 an ounce. Metal will never be worth more than practical items. "

Actually, my point would be that if the economy ever went that bad the gold itself would be useless. The shotgun OTOH would be worth something.

Frank

-- Someone (ChimingIn@twocents.cam), April 21, 2000.

Frank,

You should have been more clear to begin with.

At least you understand.

-- (Another @ anon.here), April 21, 2000.

I don't pretend to understand gold.

But it seems to me that if there is an Apocalypse, gold will play a major role in the ensuing barter economy.

An ounce of gold, for example, might "buy" a pound of potatoes. A pound of gold might "buy" two rolls of toilet paper or a Boy Scout knife.

To test my ideas. I tried to eat a one ounce gold coin. No go.

I tried to wipe myself with gold foil. Don't even ask.

-- (retard@but.happy), April 21, 2000.

^

^

^ is asking.

-- consumer (shh@aol.com), April 21, 2000.

Quote from above article;
"As unbelievable as it sounds, this is how the current IMF/World Bank monetary pyramid will end. You will see 'debt' forgiven all around the world except for the U.S. and the other industrialized nations. As I write, there are protests at the WTO/IMF meeting in Washington D.C., where monetary authorities are NOT discussing global trade, but rather how to save the failing monetary system."

Although this subject is outside my sphere, I find it of interest. Thus today read;
"Australia will waive the debt owed to it by Third World nations Ethiopia and Nicaragua, but questions have been raised about the effectiveness of the move and the motivation behind it."

Link< /a>

It continues to say;
Mr Trevor Thomas, a spokesman for Jubilee 2000, an international group that has campaigned for the cancellation of the debts of impoverished developing countries, welcomed the announcement.

"That brings Australia into line with what the US, Britain and Canada have already said - that there'll be 100 per cent [bilateral] relief," Mr Thomas said.

There's a pattern here, but it goes over my head. Oh, well....

Regards

-- Pieter (zaadz@icisp.net.au), April 21, 2000.

">Sorry about that....

-- Pieter (zaadz@icisp.net.au), April 21, 2000.

anon, et al,

I have said this before, and I feeled compelled to say it again. Don't think of gold in the price of dollars, but think instead of dollars in the price of gold. A dollar used to be worth 1/20th of an oz of gold. Today it is worth roughly 1/280th of an oz of gold. It WILL, at some point, only be worth 1/5000th of an oz of gold. Maybe not in our lifetimes, but certainly one day it will be thus valued.

People always say, "gold is a lousy investment". One should not own gold as an investment. One should definitely own gold, though.

-- J (Y2J@home.comm), April 22, 2000.

I remember a quote that always makes me smile when I think about it.

Someone said "Thirty years ago I could buy a gallon of gas for three silver dimes. Today I still can!"

I can also remember when ten Yen was equal to one US penny. Today ONE Yen is approximately equal to a penny.

The penny doesn't even have copper in it anymore because the metal became more valuable than the face value of the coin.

Robbing us through inflation is a way of life for politicians.

-- Flash (flash@flash.hq), April 23, 2000.