Normally we would not loosen things up this much until we were into a recessionary trend. But -- this time we loosened up much earlier. So -- inflation is around the corner, and our early warning system -- gold -- is picking it up.

This trend is probably aided by the unwinding of Japanese purchases of US treasuries, and by the unwinding of 'gold loans' to buy US treasuries. Many cycles seem to be coming together to weaken the dollar. The launching of the EURO is also nearly at an end -- the european community does not need a strong dollar much longer. And -- lastly -- the SEAsian panic buying of dollars during their crisis is probably nearly over.

Looks to me like our gold rally has begun, even if the DOW heads for 10,000. AG is probably too afraid to tighten the economic noose given what he knows about the $1 trillion SEAsian debt ricocheting around the world.

Earl: re hepcat -- You must forgive my periodic weakness -- I tend have an unfailing faith in human character -- just can't let hepcat's mind go to waste. You are probably right.

SDRer: I like the new, improved LGB. But -- I think he oversimplifies sometimes. I do think ANOTHER is the genuine article, and the reason we do not understand him is because he also does not have all the facts, and some of his facts are inaccurate, just as ours are. Gold ( the physical kind ) and Oil are what he knows -- not the equity markets or derivatives ( unless they are linked to gold ) . ANOTHER, like few on this site, ignores our petty feuds and attacks. That probably says more than anything else about his background being different from ours. He will not stoop to the depths of some of our posters. Civility.

LGB: Thanks for your comments on metaphysics. You and I share a distrust of what cannot be quantified. Also -- faith is part of my life, and it is part of yours. Just a different kind of faith. Just as our internal realities are different.

Donald: Appreciate your excellent bombshells as always. Looks like Venezuela is in trouble -- too much emphasis on oil income? And -- the debt equity ratio of those S Korean firms is beyond belief. What else have they propped up with their Chaebols? Shame on them for emulating Japan.

DA -

Interesting take on silver. The problem is that London does not report inventories. I'm with you though, the market is ripe to attack. Thanks for the info on the silver calls.

LGB -

You can now put any form of Bullion Grade bars or coins in your IRA now. Prior to 1/1/98 you could only buy American Eagles. You can now put Maple Leafs and VPs and bullion in the IRA. You cannot put 90% silver in the IRA but you can now put silver bullion and platinum - bullion and coins into an IRA.

Glad you like the Platinum Eagle proofs. We bought 1000 of the PE's in all sizes and made them up into sets. A one ounce, half ounce, quarter ounce, and tenth ounce brilliant uncirculated 1997 platinum Eagles in the whole blue velvet box thingie. The US mint has no more of these and 1997 PE halves and quarters are already selling in the secondary market at a 40% premium. We sell it for $1049 delivered, about $140 below what the US mint charged, but that is still about $300 over the intrinsic value of the metal at current spot, so this would be considered a collectable.

Will it pay off? I don't have a clue. The halves and quarters are very scarce, but the fulls and tenths were plentiful. The whole first year issue, uncirculated thing may create a demand, who knows? Every few years we wind up with a certain number of this kind of thing and I very rarely talk about 'em. The last thing we had like this was the Aussie set that had: two 1 kilo silver coins, one 2 ounce gold coin, and one 1 ounce platinum coin. The 2 oz gold and the 1 kilo silver coins proved so popular that the sets were all bought and broken up for sale in the secondary market. I own several of the silver Kookaburras, in fact I'm looking at one on my desk now, makes a cool paperweight.

As to whether this PE set is worth it, I don't have a clue. You know this kind of thing better than I. If there is a market for these, I may buy several myself, same price as the clients, sad to say. What do you think?

Boy, is this going to be an unpopular post -

We all are very fond of, and truly miss the original Bernatz DE. Has anybody considered the possibility that Hep might be the original DE rather than a DU come lately?

This occurred to me some time ago for three specific reasons. First, the format of the posts is exactly the same; that narrow column, single spaced type. This is not an uncommon format but is definitely in the minority. Second, the humor is very similar. Third: It seems that Bernatz DE disappeared right about the time Hep was thrown off the site.

I could be way wrong on this, but attempts to duplicate Ventadorm, although a couple from John Disney we pretty good, have failed to grab the magic that made us appreciate and look forward to DE's posts. I know this idea will meet with scorn and disdain; Many find Hep the most despised poster here; he may be one of the most beloved. An interesting thought, and one that will probably not be confirmed or denied.

I probably think too much…………….

Kind sir , what do you think a 25 cent increase in copper prices would do for BGO shares?

Thanks for responding so promptly. By the way, I think you are right about SSC. Earnings profit or loss with SSC is not the key matter with this stock. It will perform others simply because it is considered 'the pure silver play' by the precious metals investor. I bought some too about 1 week ago -- just after the first surge. Wish I could have afforded more.

My reasoning is this: ANOTHER may be one of us, he may be a Novelist testing his prose on us, he may be Oriental, he may be Middle Eastern. But -- it does not matter because he makes us think and question. I will say again what I have said at least ten times. I do not consider ANOTHER's contribution seriously until I have cross-correlated it with that of other sources. He does know about gold -- contango for example goes right over my head. So -- if you do not wish to ask ANOTHER questions to draw him out and learn, that is your prerogative. Old Gold does not mind doing it, and he is one of our most experienced gold investors on Kitco.

SilverBaron: I don't think Heavy Hitter is ANOTHER, because whoever ANOTHER is does not rattle easily. And whoever ANOTHER is, he is not American.

I hope that hepcat turns over a new leaf, and starts contributing in 'another' way to this site, specifically about gold investing. I know he can.

Bought some MS65 today, dealer said they were going up in price and becoming harder to find. I believe they may be the best buy in gold at this time.

Where is Phil Gramm when we need him?

So -- they are actually billed as $50 gold pieces? Why not make them $300 if they are directly 'convertible' into dollars? You might conclude from this that even the US government acknowledges that the 'official' value of these coins is much less than their true value. Still says nearly the same thing as 'billing' them as $20 one ounce bullion coins.

How about doing your DJIA/Gold ratio for other market indicies, too? After all, the Dow is only 30 stocks. I've taken a pass at doing the same for the S&P Composite and gold, and find the market even more overvalued than is indicated by the DJIA/Gold ratio. I only had average annual prices to go on, but here's what I found:

The S&P 500/Gold annual average ratio peaked twice before in this century: in 1929, at 1.26, and in 1967, at 2.63. It bottomed twice, as well, in 1942, at .246, and in 1980, at .194.

So, where did we close today? 3.56. This is 36% higher than the average ratio of 1967, and 183% higher than the average ratio of 1929 ( Yikes! ) .

( Remember, these are annual average ratios; I didn't have the data to do this daily, weekly or monthly. )

The end for equities is nigh.

Fergie

Hard to ignore a 1933 or so $20 gold coin once used as currency that is now easily worth $450. Sure beats paper money, too. And -- the more gold the average person has, the better prepared we will be to recover from a paper collapse. No harm done if the paper collapse never comes.

Our government tacitly supports this approach by minting $20 bullion St Gaudens gold pieces for the price of one ounce of gold.

Continuing the discussion from last evening - if you really want 'safe' bullion in your IRA account, I would suggest buying Central Fund of Canada, a bullion-only fund, now trading at a 5 or 6% discount to its net asset value. Trades on the Amex, symbol CEF, I believe. This one would be hard for the US Feds to get at.

I am faced with the same problem as you: much of my investment is in tax-deferred accounts. However, any gold/silver which I have purchased, has been done privately ( with cash ) and is stored privately ( not in a bank box ) so it is for all practical purposes non-existent to the gold snatchers. I have take the precaution not to buy any post-1933 gold coins, just in case.

If you're interested in buying pre-1933 gold which carries a very small premium to spot bullion, I would suggest some of the European gold, rather than U.S coins - such as British Sovereigns, France and Switzerland 20 Francs, German 20 Marks, Austrian 20 Corona, Italian 20 Lira, etc. All these coins contain about 1/4 or 1/5 ounce of gold, so should be suitable for small transactions.

If this sounds like paranoia, it really isn't, just prudence. But as someone said, even paranoids have real enemies........

Remember the Golden Rule: He who has the gold, makes all the rules...

The Federal Canadian decided without Quebec to build Mirabel Airport Billion ...TRASH... Laprade Heavy Water Plant... Billion ..Trash...and on and on and on...

with our taxes and all other Canadian Taxes.

Well where do we go from here?

Your are not serious when you say Saguenay Deluge or Montreal Ice Storm was a charity from Ottawa ....are you? And Floods in the Prairies? and...every disasters in the Country?

Ho French Canadian where the most efficient battle groups...at least in the pays de Moliere.

We will not separate if Canadian come back in Montreal in BUS LOAD and pledge they love us and they want to build a COUNTRY a...REAL COUNTRY at least more than ...three day before the next referendum and...base on something else of the reminessence of the past and in particular Red Neck intollerence and short see. We have two choices:

We put everything on the side and rebuild a CANADA and get realy stronger or

We scrap everything and Free for All we start it all over again!

I think you should sleep on it.

CANADA needs help to FLY in the 21 th Century, not to be drag down under ...with our fathers`s fathers`s fathers`s thoughts....

My mother was dying at the hospital on the intensives cares an she was worried with the miss respect from Ottawa to the French Canadians and the Natives People rights.

Should I live till I die with no answer?

And should my children live with no answer?

Pure Laine and Red Necks Politicians all TOGETHER have no more right to drive this great CANAQUEBECDA.!!!!

We the PEOPLE should prevail and stand for the straith logic good SENSE.

OUT of here.

I do not want to use more bandwith for this subject.

Ted and me are on the RED PHONE ( E-mail ) ,and we will settle this matter in a civilized way out of here.

I already want to say that Ted is not an A...Hole, and that he is acting like MAN.

THANK You.

To Silverbaron - I couldn’t tell if you’re serious. Do you really want to know how to invest in rhodium?

To farfel You said: ..this site belongs to the people now...not Bart Kitner. This honestly has to be the most gratifying commentary that I’ve received about our discussion group since it was started almost two years ago. I appreciate your post. I know you didn’t intend it as a compliment, but I’m taking it as one anyway.

We at Kitco are still far ahead of the pack, voices in the wilderness with noone else except fellow Kitcoites to talk to. But -- our voices are growing in number.

And I do not wish to be right about what is coming, either -- if that makes any sense.