Forum Archive Index - November 2003

["David & Jill Stevenson" <djstevo@quicksilver.net.nz>]

No I can`t tell you where gold will be in 12 months any better than anyone else . I might know something about past history like anyone else can but that is only of use if you can turn a dollar into the future . I was lucky in the 1980`s in that our company subscribed to every Nutter`s publication on gold . They may have been Nutters but at $1000 pa subscription that for some  crazy reason gave them false authenticity that - never mind  -so long as the rest of the world believed them.. We marketted gold bullion  into the London, HongKong, Zurich and NewYork markets.

Like staggered share markets around the world as the sun rose - earliest information was crucial. Our telex machines (yes Telex) operated overtime. It was an overview like no other . Given my time again I would have bet more than just my shirt. Our company`s shares were the glamour share of the Australian stock exchange two years in a row even if that Exchange did look at us sideways a couple of times.. Remember this was well after the crazy days of Poseidon and Tasminex .

      The trouble with gold is that every ounce that has been produced  since year dot or time immemorial is still around somewhere. If not in some cave or vault then accounting for the lump under somebody`s mattress in some shed alongside a paddy field or elsewhere. For that reason it is impossible to predict it`s subsequent re-emergence. Let alone get a handle on current production overview.

   It differs from oil for the obvious reason that oil gets consumed totally ,and, following production and an assured increasing world dependency it is not stored for long. Whereas it would be impossible to account for all gold in existence at any time.. Furthermore there is no control over production to protect pricing . With oil OPEC has a strong economic and political control over production. The oil producing countries are in the main extremely wealthy and could withhold production for substantial periods of time if they chose to. Gold Mining companies have thousands of underground  and opencut miners to pay in down time even if it was possible to influence production and,therefore, prices. 

    Ironically one would probably learn more about Gold from some Shanghai stall holder ,if you could speak the lingo than from any highly paid western expert on gold. Somehow the Asian mind has some affinity with the Mystique of gold. that we westerners don`t, even if we are armed  to the back teeth with all the statistics. It is a law unto itself.

    My only advice is make use of charts bite the bullet and become a TA convertee. TA lends itself certainly to bullion behaviour. Phaedrus produced a worthwhile chart the other day. History certainly repeats itself and always will. Once when the US President sneezed and the whole world caught a cold  that was reflected in the ripple effect on gold (Butterfly effect in chaos theory)

   An earlier poster gave a web site reference that was interesting viz.

          James Dines  (Dines Newsletter)

     "--- the bond markets`anticipation of higher inflation means a lower dollar down the road (true) and higher gold prices. He is excited by the action in silver and silver miners. That silver mining shares are in harmony with their bullions up trend as well as corresponding action in the golds is highly significant to us , since we have seen this at the dawn of every bull market in the precious metals. When the golds and silvers really run they can move faster than the Internets did into 2000 ".

  

          What should we read into this? Is he just a market manipulator like any other ? Nobody is neutral or totally altruistic they all have band-waggons somewhere.

 

                          David Stevenson