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8/11 "This Is The Finest Conference I Have Ever Been To." Andrey Bykov
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August 11 - Gold $448.70 up $8.70 - Silver $7.14
up 10 cents
"This Is The Finest Conference I Have Ever
Been To." Andrey Bykov
What a day! Still up here in the Yukon Territory
on a beautiful, hot sunny day on marvelous lakeside inn outside
of Whitehorse. Will spend a few days in Vancouver and then
head back to Dallas.
Gold Rush 21 was a spectacular success and went
well beyond the expectations of Chris Powell and I. Nothing
less than a historic gold conference was acceptable to us
and I believe it fair to say that as time goes by it will
be regarded as one.
We sold the conference out with delegates coming
from 14 countries all over the over the world – including
the US, Kuwait, United Arab Emirates, Chile, Panama, Switzerland,
England, Australia, Russia, South Africa, Mexico, Spain, Hungary
and Canada.
Over the next week or two Chris and I will bring
you further coverage of the conference. Some of the presentations
will be put up at The Café and the GATA web site, along
with some pictures, etc. As you know, the entire conference
was filmed. It will take us around two months to do the proper
editing. When done we will present the highlights of this
scintillating conference in DVD form to gold companies, governments,
press, hedge funds and to anyone else interested in the truth
about the gold market.
This can be huge because there was a real buzz
in Dawson City. However, as life goes on for the speakers
and delegates, they will move on to their daily activities,
as is normal. The Dawson buzz will fade. When the DVD is done,
that buzz will kick in all over again and last for a very
long time.
GATA was honored to have Mr. Andrey Bykov from
Moscow, Russia as one of our delegates. You will get a kick
out of his credentials, which you may retrieve by doing a
Google search. From
http://cns.miis.edu/pubs/week/030421.htm"One
of the most notable recent developments in this area was a
private initiative presented by the little-known Nuclear Disarmament
Forum AG (NDF). NDF was registered in Switzerland in 2000
and is managed by Andrey Bykov, who the Financial Times characterizes
as a Russian media mogul.[4] Bykov calls himself President
Putin's economic advisor.[5] He claims that NDF originated
during the U.S.-Russia negotiations on plutonium disposition
in the fall of 1999 and even played a crucial role in negotiating
the U.S.-Russian Plutonium Disposition Agreement."
Andrey was most gracious and said the following
to me at the end of the conference:
"This is the finest conference I have ever
attended."
I will put up my presentations when I return
to Dallas, however, I would like to mention my major point
at the conference – the one I hope is eventually articulated
around the investment world. It is very simple.
The central banks don’t have the gold
in their vaults they say they have. The gold establishment
and central banks proclaim they have 32,000 tonnes of gold.
The work of the GATA consultants reveal the central banks
have half of that and may only have 12 or 13,000 tonnes of
available central gold left. The rest of the gold has been
lent out (swapped) and surreptitiously fed into the market
over the past 8 to 10 years to artificially suppress the price.
Since demand exceeds gold and mine supply by
1500+ tonnes per year, The Gold Cartel and allies cannot retrieve
this gold without driving the price to the moon.
This is what GATA wants to the biggest money
players in the world to know. We are referring to the Chinese,
Arabs, Russians, and others.
Since Andrey Bykov attended Gold Rush 21, let
us take a cursory look at the Russians. The reasons for them
to load up on gold are off the charts. One need only refer
to this recent news story to appreciate why:
Russia's Gold, Forex Reserves To Double: Finance
Minister
05.08.2005 11:24
Russia’s Finance Minister Alexei Kudrin said Thursday
that Russian gold and foreign exchange reserves could reach
$200 billion by the end of this year.
Gold and forex reserves will grow by $80 billion
this year, up from the previous forecast of $50.
According to statistics, Russia's gold and foreign
exchange reserves stood at $124.5 billion on Jan. 1, and increased
to $151.8 billion as of July 1.
Kudrin said that the reserves have swelled due to high market
prices for crude oil.
-END-
As stated, the Russians have all these extra
new reserves because of soaring oil prices and need to do
something with them. Russia is the world’s second largest
gold producer. The price of gold vis-à-vis its historic
relationship to oil is hugely undervalued by more than two
standard deviations. The logical play is to load up on gold
at these cheap prices, especially with a number of the speakers
at Gold Rush 21 predicting the price of gold to rocket far,
far higher than $1,000 per ounce.
Not only will the Russians benefit by the increased
value of their gold reserves, Russian buying would get them
higher prices for the gold coming out of the ground on a daily
basis. It is win-win all around for the Russians to make their
move on gold here.
Will Gold Rush 21 have any impact on the Russian
decision making process? We probably will never know. However,
it is quite clear the Russians are paying close attention
to GATA. First the Deputy Chairman of Central Bank of Russia,
Oleg V. Mozhayskov, made the following statement at the LBMA
conference in Moscow on June 4, 2004:
"Many have heard of the group of economists
who came together in the society known as the Gold Anti-Trust
Action Committee and started a number of lawsuits against
the U.S. government, accusing it of organising an anti-gold
conspiracy. They believe that with the assistance of a number
of major financial institutions (they mention in particular
the Bank for International Settlements, J.P. Morgan Chase,
Citigroup, Deutsche Bank, and others), some senior officials
have been manipulating the market since 1994. As a result,
the price dropped below US$300 an ounce at a time when it
should, if it had kept pace with inflation, reached US$740-760."
Then, Mr. Andrey Bykov contacts GATA re attending
Gold Rush 21. I will let you make up your own mind as to the
significance of these developments.
Surging crude oil is $65.84 per barrel, up 94
cents, as I go to press.
The dollar is down .57 to 87 even.
A gapping gold market:
August gold
http://futures.tradingcharts.com/chart/GD/85
The John Brimelow Report
Bears: "Houston, We have a problem"
Thursday, August 11, 2005
Indian ex-duty premiums: AM $3.29, PM $3.07,
with world gold at $438 and $438.45. Quite adequate for legal
imports. This was despite aggressive intervention by the Reserve
Bank today to weaken the rupee, which closed at a one-month
low. The Bombay Stock Exchange closed at an all-time high,
and foreign funds are said to be pouring in.
India, the world’s largest gold importer,
has been an unwavering buyer in the $430s (see below). Today’s
NY move will certainly not be greeted with enthusiasm, but
the country will underpin it – perhaps more, if the
rupee is allowed to recover. The peak buying season is now
beginning.
On Tuesday, the ECB announced an E87Mm sale
– 7.49 tonnes at the current book value. This means
there is less than 5 tonnes to sell between now and the end
of September, if WAG2 is to be respected. While most serious
observers presume that surreptitious Central Bank selling
will continue unabated, a very shrewd observer told me last
week that the idea of apparently diminished sales is catching
the imagination of more casual hedge fund pools, in the same
way as the launch of the ETF did last year.
TOCOM traded only the equivalent of 9,666 Comex
lots (-45%) today, with the active contract rising 2 yen,
and world gold going out $1.25 above NY. Despite the strong
yen, there is a buyer active in Japan: open interest rose
the equivalent of 1,251 Comex lots, and according to the Mitsubishi
data the public added 5.6 tonnes to its long (1,800 Comex
lots). I suspect Funds, possibly Western. Yen gold is at a
14 year high.
Yesterday on Comex, only 32,087 lots traded
but open interest rose another 2,153 lots to 289, 992. This
means since last Thursday, the day I last reported, open interest
has risen 16, 361 lots, 50.9 tonnes, for a price gain of $4.10.
Since gold started to move a week last Tuesday, open interest
has risen 45,504 contracts (141.5 tonnes, or 18.6%). Gold
in the same time was up $10.10.
Clearly, a very determined seller opposes/disbelieves
any rise in gold. Based on today’s action – new
2005 high on massive estimated volume of 98,000 contracts
with negligible switches – he will have to try harder.
Indeed, the technical situation has now become
dangerous for the Bears. The magisterial long-term $US 5x3
Gold Chart maintained by Australia’s The Privateer website
has now turned up once again – see http://www.the-privateer.com/chart/gold-pf.html
. Any number of shorter term chart signals have been triggered
Credit is due to Dennis Gartman, who is not only heavily long
Euro/gold (the rise in which today clearly showed this is
not just a "currency move"), but actually added
yesterday:
"we have this urge to own gold and debt
at the same time…we've been around long enough and seen
enough strange market anomalies that we know that the truly
great trades... the ones that become legendary years hence...
are those trades that are supposed to move in contravention
but don't; or those that are supposed to move in tandem, and
also don't."
Gartman offers no theoretical rationalization
for this trade, but it is of course the classic "flight
to safety" stratagem. If this is what his powerful Hedge
Fund friends think, the Bears face difficulties.
The Indian data on the missing days were:
Monday Aug 8 2005: AM $2.60, PM $2.52, with
world gold at $436.90 and $436.95. Quite adequate for legal
gold imports.
Tuesday Aug 9 2005: AM $3.92, PM $2.90, with
world gold at $443 and $ $433.55. Ample, and adequate for
legal imports.
Wednesday Aug 10: AM $2.87, PM $3.65, with world
gold at $434.75 and $436. 15. Adequate, and ample, for legal
imports
JB
My congratulations to John B for his superb
presentation at Gold Rush 21. It was a huge hit and drew lots
of kudos from the delegates.
By the way, as you well know, John predicted
over a month ago that gold would make its move in August.
So Be It!
CARTEL CAPITULATION WATCH
The US stock market refused to go down, even
with oil surging. Most strange. However, that is the way it
is. The DOW gained 92 to 10,685 and the Dog leaped 17 to 2175.
08:30 July Advance Retail Sales reported 1.8%
vs. consensus 2.1%; Ex-Autos 0.3% vs. consensus 0.6%
Prior unrevised from 1.7%; ex-autos revised to 0.9% from 0.7%.
* * * * *
10:00 Business Inventories reported 0.0% vs.
consensus 0.1%
Prior reading unrevised at 0.1%.
* * * * *
0:30 EIA reports nat'l gas inventories +43bcf
vs. consensus +46bcf
For reference, year-ago data was +72bcf. Prior week was +37bcf.
September natural gas futures are currently trading higher
to $9.14/Mbtu initial reaction. Sep WTI crude last $64.90/barrel.
* * * * *
From Jesse:
Its 1933 all over again...
At Jesse's Charts...
http://www.geocities.com/arthurcutten/jesse.html-END-
SAfrica unions accept wage deal, end gold strike
8/11 JOHANNESBURG (Reuters) - Around 110,000
South African miners accepted an increased wage offer on Thursday
and asked their members to resume work, ending the first industry-wide
strike in the country's gold sector in 18 years.
The Chamber of Mines said the country's biggest
mining union, the National Union of Mineworkers (NUM), was
the first to call off its strike, asking its around 100,000
members to resume work on Thursday night.
The Chamber of Mines, which negotiates on behalf
of South Africa's gold producers, late on Wednesday gave miners
a new wage offer, raising wages by between 6 and 7 percent.
"Overall there was acceptance of the offer,
the process has come to its logical conclusion, the strike
ends," Gwede Mantashe, general secretary of the NUM,
told Reuters.
"The first shift goes back to work tonight
(Thursday), and there should be full normality by the Friday
evening shift."
-END-
Comments about today’s substantial gold
move:
Wow Bill,
What did you guys talk about up there? Geez, it took just
one day to break the $6 rule (although we still have an hour
left).
Regardless, congratulations on putting together GR 21.
Andy
OK. Bill spill the beans!
GR 21 has already had its impact and the world has come to
its senses. Gold is running with a 2% increase today or 8
bucks. Wow!!!!
Seriously, I was thinking today as I am seeing gold run above
6 bucks that perhaps GR21 is responsible for this breakout.
Whatever the reason claim your spot in history and take credit
for this. You deserve it.
Well done hombre. Gil.
Hello Bill,
You should leave the country more often. To bring about a
free market in gold you only need to move to Antarctica.
Hank Fellerman
Some early feedback for you from a delegate
at Gold Rush 21:
Dear shareholders,
Here is the last newsletter with news for July
and perspectives for the future. I know it has been posted
on our site a while back but I was in Yukon and could not
send it to you then.
http://www.ecu.ca/newsletter/july_newsletter.htmA
few of you might ask why I went to the GR21 conference when
I barely have time to do all I need to do here in Mexico.
There are a lot of reasons but the most important was that
I wanted to hear what some of the best thinkers on the economics
of precious metals had to say about the present and, more
importantly, the future. As you know, we produce precious
and base metals and can plan our future production to be gold-rich
or silver-rich or lead or zinc or even copper.
The presentations were way beyond my expectations.
Actually it was more an intensive short course in the economics
of precious metals with glimpses at the various potential
futures for our industry. I will need some time to integrate
all that was presented and complete my researches on some
of the most promising aspects. A very important consensus
was reached: "The focus of action should move from demonstrating
that the previous metals markets are rigged to informing people.
The accumulated proofs are more than sufficient."
How does this impact ECU? Very simply; it means
that the truth has reached a point were it is ready to break
out even if standard information channels might be reluctant
to follow at the beginning. Some are picking up the story,
CBC North and TV Azteca for example, and others will follow
because word will eventually spread. When will it happen?
It could be today, tomorrow or in the next few months but
we will not have to wait for years. I will certainly not try
to predict future prices for gold and silver except that they
will go up significantly and that it will only improve our
bottom line. It confirms that our strategy of increasing production
in the short term is the right one.
All of the conferences were interesting but
those of Ferdinand Lips presented by JP Schumaker and Hugo
Salinas Price would be a good start for those of you who want
a better understanding of what is going on and what can be
done in the precious metals sector. All should be available
soon and I will keep you posted. If you like what you read,
more information on the same topic will be available. Just
tell your friends!
Michel Roy
CEO, ECU Silver
Chuck checks in:
I first want to recap what I have felt was happening
in the gold market. At the very bottom around 75 on the XAU
and 165 on the HUI, the pessimism was palpable. From the sentiments
to the Central Fund discount to the noveau technicians with
their lines and breakout failures, and above all the sense
that all of the exploration companies were about to go out
of business were indications of a cyclical bottom. For our
readers, how many sleepless nights did you go through or how
much of your gold holdings did you sell here? That is the
personality of a major bottom in a bull market.
Then as the listed stocks started to come out
of their graves we had a couple of scary openings and intraday
drops to keep everyone nervous. But what I saw was even during
this some of the stocks were moving up. In particular, Goldcorp
was regaining its preeminence as a holding in portfolios.
Today GG hit an all-time high. Now most of the larger listeds
are joining in and the smaller ones that have been having
production problems such as GSS and BGO are moving up also.
Still, the smaller ones are acting as though they have leprosy.
To me that means that the gold complex, and most likely silver,
are still climbing the proverbial wall of worry. I believe
soon they will be in gear and if you want to buy them, you
will find out how illiquid these little gremlins can be. Eventually,
this will be the most speculative market in the history of
stocks, as absurd as that appears to be right now.
As far as what is happening, my take is that
the monetary situation has gotten out of hand. I don't pretend
to know what that all really means or how it will play out,
but when you seen some of the moves here in copper, oil, and
the downward pressure on Citigroup and FNM, then something
is afoot. Will there be a financial bomb or a derivative attack,
it's possible, but I don't know?
I wrote a couple of weeks ago that the big move
in the gold shares that day signals a likely break out to
new high grounds. That is what happened in 1982 when the stock
market propelled into new highs on high volume and a lot of
gaps. I know because I was short at the time and not the least
bit concerned or had any idea that we were entering the bull
market of our time. That is what I see here in the gold shares.
The shorts and the derivative holders have no idea what is
going on, but they will. The hardest part of investing is
to have patience and believe in what you are in. It is time
for some payoffs. Chuck ikiecohen@msn.comPS from Chuck:
The one thing that I would add onto the scenario
of an August-September rally in the shares is that we are
overdue for a good rally into the new year, and that is my
strong suspicion. This move is going to shock everyone.
***
GATA extends its profound thanks to Agnico-Eagle
for auctioning of ten gold bars at Gold Rush 21. More on this
later. You might like to know the ten coins raised $39,600
for GATA. Joe Martin of Cambridge House, our professional
auctioneer for the evening, did a great job and had the delegates
howling.
The $6 Rule was finally broken, only two days
after the conclusion of Gold Rush 21. As mentioned at the
conference and in MIDAS commentary, every time GATA has left
the US to make a major presentation, the price of gold has
made a significant move up on a percentage basis. Was this
yet another fluke, coincidence? You be the judge again. GATA’s
Wistar Holt noted today’s move is the largest since
he became involved in the market four years ago.
Love, love, love the action in the gold shares
today. The XAU rose 3.93 to 9.46, while the HUI popped 9.79
to 217.85. The gold and silver shares remain THE historic
investment opportunity of a lifetime.
GATA BE IN IT TO WIN IT!
MIDAS
*****
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