"MIDAS" COMMENTARY FOR MAY 16, 2001 DUPLICATION PROHIBITED WITHOUT PERMISSION By Bill Murphy www.LeMetropoleCafe.com May 16, 2001 Gold $272.10 up $4.30 Silver $4.45 up 15 cents Mega-commodity fund John Henry was a huge buyer today with Goldman Sachs executing the trades for them. It must have been a most unwelcome big order for Goldman Sachs, a grin-and-bear-it type. I cannot stress enough how important the news out of South Africa was today. We have turned the tide and mission accomplished for GATA's Operation South Africa. I say that because I know from summit feedback that many in the South African political world were nervous about GATA because of whom we are taking on -- the most powerful government in the world and the biggest money in the world. The African politicians are little different from those in the United States. Campaign contributions rule when it comes to politics and political contributions. GATA is taking on some of their potential warchests. Those in political office and in positions of influence had the most to lose if GATA turned out to be a balloon of hot air that went pop. Well, we didn't pop in Durban. Reg Howe, James Turk, and Frank Veneroso were very convincing. As I have related to you, the press coverage was massive. The material and action plan we gave to the Africans spoke for itself. It is wonderful to have the truth going for you. No one in the gold industry or anyone who reports on the gold market has been able to show GATA where our evidence of gold market manipulation is wrong. That includes AngloGold. James Stock sent the following today to various press in Africa from our South African headquarters in Durban: "Today in South African Parliament the minister of economics, the Hon. Trevor Manuel, and members of Parliament discussed GATA and the manipulation of the gold price to the detriment of Africa. The Bank of England's gold sale was discussed and the government was asked why it was not financing GATA's court action against the U.S. administration. The minister of mining replied that she had not been approached." This means that the cat is out of the bag regarding our allegations. The finance minister had plenty of time to review GATA's evidence and allegations. There never would have been this kind of talk in the South African Parliament unless our charges were very credible. Remember, the South African Reserve Bank quietly attended the Durban conference. This means that from here on in the powers in South Africa will no longer be afraid to get behind GATA's action plan. Just the reverse. Many are now going to be afraid not to get behind GATA and will not want the GATA train to leave the station without them. This is just the beginning. I understand that Secretary of State Colin Powell is headed to Africa soon on a trade mission. He is most likely going to hear about some gold trading during that mission. There are other positive developments from Africa. One of the sharpest attendees at the Durban conference was Voltaire Kegode of Kenya. I told him I thought he could lead his country someday. He is well-connected with government officials in Kenya, and GATA's South African publicist, Rhoda Fowler, called from Durban today to say that he has given 10 packets of our informational material to key politicians in that country and has explained GATA's charges to them. He is going to follow up and give a report to Rhoda in Durban. Kenya wants to be kept fully informed. Kegode is most perceptive and joined Reg Howe, James Turk, and me, among others, for dinner after our presentations. This too just in, sent from GATA's Durban headquarters to our secretary/treasurer, Chris Powell: "The Embassy of Sudan requested information on GATA to be e-mailed to them. Please put them on your database." * * * >From Cafe member John Brimelow: "Indian ex duty premiums: AM $5.08 PM $4.43, with world gold at $268 and $268.90. Legal imports clearly possible this morning at least. The CRU Precious Metals Monitor, which arrived yesterday, remarks that Indian buying has changed its character somewhat. In a section entitled 'Physical market booming in India,' they clumsily observe that "current buying is being carried out at each differing level that the gold price moves to." They speculate this follows the recent dealing scandals. What this means for the world market is that the respite for the shorts provided by weakening Indian demand on a price rise will be diminished. (It appears the importing merchants would borrow gold rather than buy to satisfy domestic demand: the credit lines that enabled them to do this have been curtailed.) "Technical types are getting excited by the action in both gold and shares. An unusually useful Bloomberg story today quotes a European source suggesting that the action and remarks of the Fed yesterday have alarmed observers overseas. It was certainly true that gold moved decisively when the Continent opened this morning." * * * Gold has now rallied $17 and the dollar has barely budged, as it remains above the 116 level. As I have stressed for a couple of years now, the real gold move will have little to do with the dollar. Certainly a weaker dollar is beneficial for the price of gold, but the real story is the Gold Cartel and their massive short position. When they lose control of their manipulation or are defeated: checkmate, gold soars. Simple as that. That is why recent GATA developments are so exciting. For years we had to use the Mohammed Ali rope-a-dope strategy. They punched us over and over. We took it in the hopes that they would punch themselves out. Maybe they have. As I finished up with in my Durban action plan presentation: "The Enveloping Horn" is now in full battle formation. By acting decisively together we can close the back end of the "enveloping horn" on the Gold Cartel. These financially and politically powerful institutions are likely to be slightly bewildered. The truth will see the light of day and we will win. So will all of sub-Saharan Africa." The rope-a-dope is out. We are now punching the Gold Cartel with all our fury. It is time for them to be knocked out. James Turk has told his followers for months that gold's breaking $272 on the upside was very important technically. He felt that if this level was breached, which it was today by some counts, gold could easily rally another $100 by the end of this year. That is what James told the South Africans too. I called James this afternoon. The Comex has spot at $272. Another 10 cents and a Friday close above $272 and that is all she wrote, according to the technically knowledgeable Turk. GATA and the Cafe would like to thank Brien Lundin of Gold Newsletter note for his kind words. The theme for his most recent letter, the May edition, was "Manipulations Everywhere." He suggested that his readers visit the GATA and Cafe websites. Gold Newsletter was the creation of the legendary Jim Blanchard. I had the pleasure of speaking at Gold Newsletter's fall conference in New Orleans 18 months ago and plan to be there this year. Stay tuned for a Cafe/GATA extravaganza at the conference. Planning is in the works. Gold stocks are raging around the world. Australian gold stocks rose to a 14-month high and the entire Johannesburg index went to all-time highs. The XAU closed at 62, up 3.43, and looks like a rocket ship. The precious metals sector is the best-performing one in the United States over the past six months. The mainstream investment world finds that hard to believe. They ain't seen nothin yet. This is an example of how GATA is winning the war: * * * "Thought I would briefly let you know that I drove quite a ways tonight to attend a town meeting being held by my U.S. representative, Brian Baird. "In front of about 200 people I voiced my concern about the ownership of the gold stored at West Point and presented him with a binder that included: "-- A cover letter reqesting he ask GATA's eight questions to Fed Chairman Greenspan and Treasury Secretary O'Neill. "-- James Turk's article about the Exchange Stabilization Fund's gold swaps, the reclassification of the gold at the U.S. mint at West Point, and the Bundesbank. "-- The statistical articles about the manipulation by Demitri Speck. I must say that Representative Baird looked very much like a deer in the headlights when asked about this issue. He did promise, I believe sincerely, to review the information and forward the questions. "After listening to him for two hours, I believe him to be honest and extremely hard-working. He had a better command of the issues (for example, the energy crisis) than I would expect from any congressman. "A response that I had not expected was that about 10 people actually wanted to discuss the gold issue with me after the meeting! "I would suggest that you prepare an informational packet to help others like me who want to approach their congresspeople in person. I suspect that others would be willing to confront their congressmen with this, but they don't want to take the time to prepare the materials. "Any suggestions at how to get responses to letters to my senators? Let me know what else I can do to help. "Congratulations on your success in Durban. "Thank you, "Carl Huster, Ph.D." Ask and ye shall receive. This morning Chris Powell sent a dispatch to all of us this morning on how this could easily be done. The following is from Dave Walker, who has done yeoman work for GATA with the Federal Reserve meeting minutes: * * * "The more I read, the more I think that you are right about former Treasury Department official Ted Truman. Look who breaks the Bank for International Settlements news! (Truman was the Treasury guy who wrote to Chris Powell on May 10, 2001 -- the day Frank Veneroso, Reg Howe, Chris Powell, and I met at the U.S. Capitl with House Speaker Denny Hastert. Truman wrote to no one else.) CHAIRMAN GREENSPAN. Any further comments on this? If not, let me turn to Ted again on another matter with respect to the BIS. MR. TRUMAN. Some of you are aware of this and some of you are not. We have been entitled to such seats (on the BIS board) since the bank was founded in 1930. This matter has come up again in recent months, and the board considered it a couple of months ago after consulting within the Administration and decided to go ahead. Next Monday the BIS will be announcing that we have reached this decision, that the (Fed) chairman would take up the ex-officio seat and that (New York Fed) President McDonough would take up the other appointed seat as the second U.S. representative on the board. "This is NO small-fry economist. I am thinking that he is running the show, or running it for somebody. He knows all the answers and knows everything inside and out." * * * That was then, but now that the BIS bought out its U.S. shareholders like Reg Howe at 40 cents on the dollar, what right does the United States have now to be involved with the BIS. That is one of the reasons Reg Howe is suing Greenspan and McDonough in U.S. District Court in Boston. What can they possibly come up with? -END- Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
