Mover Mike

To mark the first anniversary of the publication of Eye of the Pyramid by Terry Krohn, Axiom House, the publisher is offering bonuses to those who purchase the book via a special Amazon.com Internet link on Thursday, Dec. 1.

As part of the anniversary Terry Krohn has graciously spent considerable time talking with me on a whole wide range of subjects; subjects that are an integral part of this rip-roaring, can’t put it down story that spans over 2000 years and ranges from Egypt to the Alps to Homestead, Florida.

This is Terry’s first published novel. He spends his time in the Washington D.C. area with his wife and two children. He likes to get up early in the morning to write and may continue into early afternoon. Before he stops for the day, he would sketch in what might occur in the next day’s writing and allow his mind to ruminate over the evening. Many times he would think, “Oh, that’s what I thought would occur, but what happened to this character? Several chapters would evolve that were not mapped out before.”

There is always a “pad and pen handy” – he actually most often uses a word processor. Sometimes a thought will occur to him, but the writing is not ready for the event. If he doesn’t write it down, it could be lost to him.

“Eye of the Pyramid really took on a life of its own. I would set the scene and then embed myself and let things happen... and then take great pains to make sure the scene were realistic and properly resonated with readers.” In his 40BC period, he would start by imagining the lighting, the sounds, who was ruling Egypt, what would a shepherd be doing, the architecture, as well as the life style. He describes writing as being similar to reading and is surprised at times, by what “comes from the ether” or flows from the end of his “pen”.

I asked how he does his research and he said the “Net” is fabulous. “I try to strike a balance between enough information but not too much, because the reader’s imagination is far superior to my ability to describe. You give the reader enough detail to fill in the picture.”

Terry holds an MS in mathematics as well as an MBA, and has written extensively on the markets as PMTrader. I said that the great thing about Eye of the Pyramid is (as in Crichton’s books or Dan Brown’s books) not only is there scientific information that teaches, but a great story.

I asked how does the reader discern fact from fiction? For example: Was there a race that lived 50,000 years ago that lost the advanced technology that was found by the young Esau in 40BC? He said math has at its core (like good fiction), axioms that are arguable... not universal truths. (For example: Euclidian theory says that parallel lines never intersect; non-Euclidian theory says parallel lines intersect an infinite number of times.) You can see the mathematician operate in the book: an advanced race existed 50,000 years ago is the axiom and all actions flow from that premise.

The conversation with Terry is wide ranging. We talked about religion, for part of the story occurs at the time of Christ’s crucifixion. Esau is asked to probe the mind of Christ and he describes the wonder of the man. Esau is very gifted, but he says

“Master, my power is but a grain of sand and His all the sands of the Earth, my thoughts a drop of water and His all the oceans of the world. The tides would stop; the sun would hide its light, would He but ask. The very air He breathes is loath to leave His body; the food He eats nourishes Him with unbridled joy.

He sees my thoughts through mine own heart, mine own mind, my very soul; His presence in me is benevolence incarnate, my ecstacy at His spirit's gentle touch beyond humble words. I am but a man; He is so much more.

Even had I the power to act against Him, I could not, His kindness is so strong, His compassion a force far stronger than the greatest of mountains, the whole of the earth.”

One big difference between the DaVinci code and Eye of the Pyramid: Eye of the Pyramid exalts the wonder and love in Jesus Christ rather than trying to show he was an ordinary man who married.

We talked about Edward Leedskalnin, a man five feet tall, 100 pounds who built the Coral Castle in Homestead, Fl., single handedly out of 1,100 tons of coral and his block and tackle equipment only checked out to 2,500 pounds. Folks say he found a way to levitate the rocks. In order to properly convey the look and feel, Terry had to visit it. So much of what Malone goes through is Terry’s take on his visit. Our conversation roamed to Nikola Tesla and the Hutchinson Effect and “blackholes” in people’s thinking.

We also talked about the destruction that has occurred to our money. I asked why is there no outcry over the debt we have piled up, no outcry over 5 Billion ounces of silver gone, no outcry over the use of fiat money in the world?

In the book Dr. Paul Malone is meeting with the Secretary of the Treasury. As the meeting is concluding, Malone says:

"Let me ask you a question. Are you aware that there are four large firms with a paper obligation to deliver silver on the Comex exchange which is bigger than all known above ground reserves? This could be a derivative time bomb in the making. And are you aware that the regulating authority, the CFTC, appears to be turning a blind eye to the matter?"

Terry thinks that the reason there is no outcry is that with fiat money, there is a “time disconnect” between the action and the reaction. Issuing authorities can be irresponsible with our money for years and years, but by the time the effects of overly inflating our fiat money supply finally show up in higher prices to the consumer, the people – and or the action – responsible are often long gone. With a hard money standard, there is no such time disconnect – inflation is immediately felt and we know who is responsible. “In a very real sense, a fiat money standard takes away a measuring stick from the people – a measuring stick which judges the efficacy of monetary policy.”

Today, there seems to be a disconnect between labor and money as well. With a hard money standard, something of value – which requires labor to produce – backs our money. With a fiat standard, one side of the transaction is labor-free. This disconnect can cause dislocations in the monetary system.

It made me think of derivatives. In a normal course of events, shortages of a commodity bring higher prices, which lead to greater production, which leads to lower prices. It is quite an elegant system and leads to ordinary results. When you have a world filled with players who manipulate prices through the use of derivatives in a product that is becoming dearer, there will not be an ordinary end.

I also thought of the forests around Yellowstone or Yosemite. There was an active fire suppression system in place. Then when the inevitable finally happened, the fire was so much bigger than normal, that it ruined the forests for years and years. In light of the devastation, changes are finally being made to forest management regarding fires.

Terry hopes that readers enjoy his book for both the mystery/thriller entertainment, as well as the historical content that it presents.

For myself, I hope messages such as this will exert pressure to change the system before we have a monetary fire that consumes us all.

Now to celebrate the one year anniversary of Eye of the Pyramid, Axiom House is running a special this Thursday. If you buy a copy of Eye of the Pyramid from Axiom_House on Amazon.com, you will receive a long list of special gifts. Including

• Free Poetry by Mike Landfair - Original poetry never before published and kindly offered by Mike Landfair.

Did I tell you Terry Krohn is working on a sequel? Power of the Scepter is scheduled for release in the summer of 2006. There will be more on the discovery of Leedskalnin and The Hutchinson Effect: A way to control a very real effect – in general it seems to arise when radio waves are passed through a strong electrostatic field. The combined field acts as if energy keeping atoms apart is broken down. I can’t wait for another discussion that ranges far and wide!

One of the bonuses includes the first three chapters of the new book. Here is a complete list of the bonuses: http://www.axiomhouse.com/offers/bonuslist.htm

Mover Mike has posted a number of times about Eye of the Pyramid:

Eye of the Pyramid

"Silver" means "Derivatives"!

$80 Trillion

Searching for Amber...

What Happened to Our Silver?

Terry Krohn Eye of the Pyramid gold Mover Mike

WirNit has a story about an apparent missile attack on a plane out of LAX

A pilot on an American Airlines flight out of LAX to Chicago over Thanksgiving weekend called the Tower to say that as they were climbing after takeoff at about 6600 feet they saw a rocket fly up past them and just miss the airplane. The FBI interviewed the pilots and have detemined that it was probably a flare or a bottle rocket.

missile attack Mover Mike

Update: DECEMBER14, 2004 FOX News reported a year ago that

Counterterrorism officials are beefing up security at Los Angeles International Airport to protect jetliners from terrorists armed with shoulder-launched missiles.

I suspect there has been some "reaming" done over this embarassment!

From FMNN, BYU DISS ON WTC PAPER

It only took five days for his school to tell him to stop giving interviews. Now Brigham Young University is issuing statements discrediting Professor Steven E. Jones for his recent paper declaring that the World Trade Towers were brought down, not by the planes crashing into them and burning them down, but by some internally placed explosives.

Internet news sleuth Greg Szymanski reports that Jones's findings have been defamed by his BYU colleagues and administration, in a deceptively polite sounding and patronizing release: "Brigham Young University has a policy of academic freedom that supports the pursuit and dissemination of knowledge and ideas," it began. "The university is aware that Professor Steven Jones' hypotheses and interpretations of evidence regarding the collapse of World Trade Center buildings are being questioned by a number of scholars and practitioners, including many of BYU's own faculty members. Professor Jones' department and college administrators are not convinced that his analyses and hypotheses have been submitted to relevant scientific venues that would ensure rigorous technical peer review."

Jones is no longer talking openly with the media, at the request of the BYU administration.

Colorado handles outspoken activist Ward LeRoy Churchill differently that BYU handles an alternate theory to the attack on the WTC.

Steven E. Jones WTC Ward LeRoy Churchill Mover Mike

The rock that was Enron is still generating ripples in the energy swamp. From the SacBee, Bankruptcy appears to be likely for San Jose power generator.

A major power company, Calpine Corporation supplies customers and communities with electricity from clean, efficient, natural gas-fired and geothermal power plants. Calpine owns, leases and operates integrated systems of plants in 21 U.S. states and in three Canadian provinces and is building a plant in Mexico. Calpine was founded in 1984

When energy prices collapsed in mid-2001, many of the big power sellers making money in California wound up in bankruptcy court, including Enron. Calpine lost $683 million in the first nine months of this year and has been fending off bankruptcy rumors for some time.

Besides the bankruptcy of big power sellers, Calpine owes $18 Billion and almost all of its plants are fueled by natural gas.

a nice strategy when gas was cheap, a poor strategy now that gas has roughly quadrupled in price since 1999.

Another ripple is making the news in Portland, Oregon. Willamette Week breaks a story, credited by KATU Channel 2 at 11:00 PM, that PGE, owned by Enron collected taxes from utility customers and didn't pass them on to Enron and didn't pay the governments involved, but took the taxes into revenue of PGE and used them. The Oregonian has a story by Gail Kinsey Hill about $1 Billion in overcharges beginning in 1997, which appears to be related to the Willamette Week story, which hits the streets at 10:00AM, but does not credit Willamette Week. The Oregonian does say

Much of the controversy focuses on PGE's collection from ratepayers of $80 million to $90 million annually to cover income taxes, most of which never reached federal and state authorities because of Enron's tax strategies.

[...]

PGE serves customers in 52 cities and parts of six counties (in Oregon). Portland accounts for roughly 25 percent of the utility's electricity consumption.

Enron Calpine PGE Mover Mike

Carnival Of Liberty XXII is up at Below the Beltway.

Eric Cowperthwaite says Carnival of Liberty

is a forum to showcase writing on individual liberty. Whether your writing focuses on how it has been restricted, or how it is growing, or some other facet of individual liberty, it's something we want to showcase and expose to a wider audience. On a weekly basis, the host of the Carnival gathers submissions from around the web and then formats the whole into a single entry on their blog. The host decides how to organize the entries, whether there is a theme or not, and makes sure that the contributors get credit for their work.

Check us out!

Here's advance notice on a Wednesday Post. Mover Mike will be posting an interview of Terry Krohn author of Eye of the Pyramid. Books can excite, intrigue, inform, educate and take me to a whole different place. They can enhance existing interests or start me off into a whole new area of exploration. For me, Eye of the Pyramid was such a book. So come back Wednesday night late for the interview and there will be a special bonus.

I have become fascinated by the economics of the book publishing business. I had a conversation with published author Ron Franscell about this subject not too long ago. Ron says couple years ago, this was the rough breakdown on a typical $25 hardcover book:

--Amazon will earn about $13.50 as the bookseller (traditional booksellers actually earn slightly less.)
--The publisher keeps $8.50 to $10;
--The shipper/distributor will make about $2.50;
--The author will earn $1.25 to $2.50 (roughly 10% of the net or retail price, depending on the size of the publisher and/or the author, and their deal.)

Everybody pays their own expenses, of course. Amazon has employees, big servers and warehouses; publishers have skilled employees, printers, equipment, etc.; and distributors have trucks and shipping costs. Nobody is making an easy buck.

But the author has the worst cost/benefit ratio. He pays for all his own equipment, supplies, travel, phones, a 15%-off-the-top agent, a publicist, etc., too -- although he earns the smallest share from his art.

Today, publishers require (not ask ... require) authors to shoulder most of the promotion of their books, too. If an author does a book-signing in your town, it's likely he's there at his own expense. Publisher-underwritten book tours are reserved for only the biggest- and best-sellers ... yes, exactly the people who need LESS promotion.

The great bulk of "successful" authors are selling 3,000 to 5,000 copies, and pocketing $10,000 to $15,000. Four of last year's five National Book Award nominees reportedly had sold fewer than 5,000 copies.

So tune in Wednesday to my interview with Terry Krohn. I promise you some excitement!

Eye of the Pyramid Terry Krohn Mover Mike

Gill Blog sponsored by Gill Advisors Inc., where their work focuses on business continuity and risk management has the latest Carnival of the Capitalists.

Mover Mike is represented with post about hedging and the proposed Barrick acquisition of Placer Dome.

BTW, Bloomberg has a story about President Pierre Lassonde of Newmont Mining Corp., the world's largest producer of gold.

He says the price of the precious metal may rise to more than $1,000 an ounce in the next five to seven years as demand from Asian economies outstrips the global supply.

Actually, he said the price of gold would be some number followed by three zeros! And he doesn't mention that the central banks are running out of gold to sell to suppress the POG.

Carnival of Capitalists gold Pierre Lassonde Mover Mike

I have posted three times about copper prices and the possibility of a squeeze based on an alleged short postion by a trader at the SRB in China of 100,000 to 200,000 tonnes of copper. I posted here that the short position was confirmed in the Washington Post By Peter S. Goodman who wrote

China on Thursday acknowledged that a since-detained government trader placed a series of disastrous bets on the price of copper in London this summer, leaving the state to cover hundreds of millions of dollars in losses, according to a report in official Chinese media.

I have read two articles in the last two days that indicate the story may be wrong. The first involved a man who visits a great number of places in China and says that there is a surplus of metal in the country. The second is an analysis by Frank Veneroso who comes to the same conclusion in a different way. He speculates that hedge funds are attempting to corner the market for copper and that demand for copper in China has slowed because of the rise in the price.

If the latter sources are correct, the price of copper is headed for a fall below $1.00 and some hedgies will get hurt. Stay tuned!

copper Mover Mike

How many weeks has it been now since Katrina came close to destroying New Orleans? From the Seattle PI, After Katrina, living on the second floor, Dr. Joe Thompson

...focused on the half of his house left intact by Hurricane Katrina: High above the floodwater, the craftsman-style house's second story had survived the storm unscathed.

[...]

Tired of hotels and imposing on relatives, families are returning to their partially destroyed dwellings, taking refuge above the warped wood and stripped wallboard and cocooning themselves in a world of familiarity - even if only one half of it survived.

They have no electricity or hot water, many cook outside and use the hose to wash dishes, but at night you can see candles fickering in a window and flashlights moving in the upstairs' windows. These are the "homesteaders"

Lynn and Bobby Shirer live on the second floor where it is cozy and it is home!

Come morning, the couple pads down the spiral staircase and re-enters the world of destruction they're trying to patch: Walls are stripped to the studs on the bottom floor of the elegant Georgian. The wood floors, bloated with floodwater, have been ripped out. Like a burial shroud, a blue tarp covers their ruined furniture.

We've had Northwest storms in the winter that leave us without electricity for brief days or at most a week, but to go for weeks...I can't imagine the hardship!

Mover Mike Katrina

Barrick Gold Corp.(ABX), has made a hostile takeover bid for rival Placer Dome Inc. (PDG). Now hedging has become an issue.

In rejecting Barrick's $9.2-billion (U.S.) offer Wednesday, Placer chief executive officer Peter Tomsett took a run at Barrick's hedging practices, saying they exposed Barrick shares to "risk and uncertainty" and could significantly hurt Barrick's future financial results.

Barrick fired back that its percentage of reserves committed under hedge agreements is almost exactly the same as Placer's, and that Barrick has been steadily whittling down its hedge book since the end of 2001 while Placer's overall hedge position has increased over the same period.

Gold producers use hedge agreements, or forward sales contracts, to protect themselves from flat or falling gold prices and also to help secure financing for new mines.

Many mining companies borrow money from the banks to develop mining properties. The banks who are risk averse require the mining companies to sell the future production forward, which means that a company sells its future production today at, say $550 per ounce. This works great for all concerned if the POG stays at this price or goes down, because you sold it all at $550. The rub is that POG goes to $650 and the mining company doesn't pick up that extra $100 per ounce.

Hedging helped Barrick's financial performance during the 1990s. But when the price of gold began to rise this decade, many investors began to shun hedged producers in favour of those who could sell all of their production at spot prices.

For twenty years POG was in a bear market and hedging worked just fine and Barrick was one of the few profitable gold mining companies. The POG bottomed at $250 in 2001 and has since doubled. IMO the POG will be higher than the Dow Jones Industrial average in the years ahead and hedging is a guaranteed loser. Most investors in gold mining shares shun companies that hedge their production. After all, we take all the risks involved in the mining business, mines can flood, there can be environmental risks, labor strikes, political risks and mines can give out. We want the ability to make obscene profits if our scenario for the POG works out.

My sources tell me that Barrick may be as much as $3 Billion offside on its hedges. Meaning if Barrick was forced to buy back its hedges it would cost them $3 Billion more than they received. That is $3 Billion that should have benefitted the shareholders. I believe that their troubles are only beginning.

GATA has warned mining companies for years to get rid of their hedging. Many have done so including the largest Newmont (NEM)*, but Barrick and Placer Dome have not. GATA has also warned that that central banks and bullion banks are short 12,000 to 16,000 tons of gold, meaning the gold has been borrowed (leased) and sold. Now some leasors want their gold back and supplies of gold used for price suppression are half of what is declared publicly. It's a huge impetus for huge price increases.

*Newmont has inherited some hedge agreements through acquisitions.

Barrick Placer Dome Newmont gold

Update: From Vietnam we learn that real estate has been so hot that many borrowed gold, sold it and used the proceeds to buy real estate. Now the POG has jumped and they are in trouble.

Ngo Xuan Quy from Tan Phu district, Ho Chi Minh City, one such individual said that the gold price was VND 890,000 per tael when he borrowed gold but it has now risen to VND 940,000 per tael, equating to a loss of VND50mil over half of month.

Update:

David Bowie to play Nikola Tesla in new film.

Rock idol David Bowie has landed a new movie role, playing the inventor and electrical genius Nikola Tesla.

Bowie, 58, will star alongside Hugh Jackman, Christian Bale and Michael Caine in forthcoming film The Prestige, according to movie industry magazine Variety.

Tesla is regarded as one of the greatest scientists in the history of technology and one of the most innovative engineers of the late 19th and early 20th centuries.

The new thriller is based on a 1996 novel by Christopher Priest, The Prestige

From Publishers Weekly
Priest's new novel (the title of which refers to the residue left after a magician's successful trick) is enthrallingly odd. In a carefully calculated period style that is remarkably akin to that of the late Robertson Davies, Priest writes of a pair of rival magicians in turn-of-the-century London. Each has a winning trick the other craves, but so arcane is the nature of these tricks, so incredibly difficult are they to perform, that they take on a peculiar life of their own; in one case involving a mysterious apparent double identity, in the other a reliance on the ferocious powers unleashed in the early experimental years of electricity. The rivalry of the two men is such that in the end, though both are ashamed of the strength of their feelings of spite and envy, it consumes them both, and affects their respective families for generations. This is a complex tale that must have been extremely difficult to tell in exactly the right sequence, while still maintaining a series of shocks to the very end. Priest has brought it off with great imagination and skill. It's only fair to say, though, that the book's very considerable narrative grip is its principal virtue. The characters and incidents have a decidedly Gothic cast, and only the restraint that marks the story's telling keeps it on the rails.

Nikola Tesla DavidBowie The Prestige Mover Mike

The Drudge Report has a story that a former Canadian Minister of Defence, Paul Hellyer, says

UFOs, are as real as the airplanes that fly over your head.

[...]

The United States military are preparing weapons which could be used against the aliens, and they could get us into an intergalactic war without us ever having any warning....The Bush administration has finally agreed to let the military build a forward base on the moon, which will put them in a better position to keep track of the goings and comings of the visitors from space, and to shoot at them, if they so decide.

Three groups have approached Canada’s Parliament in Ottawa, Canada’s capital for hearings appaently on ETs and weapons in space.

Paul Hellyer ETs Mover Mike

The Daily Pundit has a follow up to the Team Hollywood report that CNN was abusive to callers regarding the "X"

"A Turner switchboard operator was fired today after we were alerted to a conversation the operator had with a caller in which the operator lost his temper and expressed his personal views — behavior that was totally inappropriate. His comments did not reflect the views of CNN. We are reaching out to the caller and expressing our deep regret to her and apologizing that she did not get the courtesy entitled to her."

CNN Mover Mike

The Washington Post reports Losses on Copper Futures Have Leadership Spinning By Peter S. Goodman. As reported here, it was suspected that in China a rogue trader was short 100,000 to 200,000 tons of copper and was unable to cover by delivery, resulting in hundreds of millions of dollars in losses.

China on Thursday acknowledged that a since-detained government trader placed a series of disastrous bets on the price of copper in London this summer, leaving the state to cover hundreds of millions of dollars in losses, according to a report in official Chinese media.

[...]

In July and August, when the price was at about $3,300 per ton, Liu (Qibing) agreed to sell roughly 130,000 tons for delivery in December, according to China Daily. This week, copper for delivery in December was trading above $4,200 per ton. Total losses have previously been estimated at $60 million to $200 million.

As the price of copper climbed, Liu's supervisors apparently pressured him to double his bets in hopes that an eventual drop in the price would erase his losses, lest they provoke scrutiny from higher up, said a source familiar with the case. A merely bad bet ballooned into a disaster.

China has tried to sell copper into the market to make it look like there was no problem, but it is reported that China has begun stockpiling copper in Shanghai in case it has to transfer large volumes to the London market to cover Liu's bad trades.

The market may have averted a big short problem if China delivers copper from its strategic reserves. However, it may mean real shortages of copper in three to six months as China will need to buy copper to meet its construction needs and the cupbord will be bare.

China copper Mover Mike

Before we head out to an afternoon of turkey delight at Bev's parents, let me pause for a moment to thank God for all my blessings.

God, grant me the serenity to accept the things I cannot change,
the courage to change the things I can
and the wisdom to know the difference.

Happy Thanksgiving, may you all arrive at your destination safely.

In case you haven't noticed Ads by Google have added a new feature which may be very lucrative for bloggers. Google has added a link to "advertise on this site".

Google AdWords is a robust advertising program that connects your ads with customers on this site and across the web. Use AdWords to target your ads to this specific site or based on keywords of your choice. Write your own message and set your own price for each ad click or impression - you have complete control.

It's like a pay per click campaign you initiate with Superpages or Yellowpages. I suspect that there will be a premium put on sites that generate high traffic, that sticks for more than a few seconds and that has loyal readers. If we are to participate in this democratization of advertising, we must foster actions that nurture those three activities. It goes without saying that it starts with content.

Google AdWords Mover Mike

On August 4th, I posted Book Revue: The Ezekiel Option

The Ezekiel Option is about a new dictator rising in Russia. Iran is feverishly building nuclear weapons. A new Axis of Evil is emerging. Is the world rushing to the brink of an apocalypse prophesized more than 2,500 years ago?

It boiled down to a UN General Assembly Resolution which said

"the proliferation of nuclear weapons in the region of the Middle East would pose a serious threat to international peace and security. It called for a "nuclear-weapon-free zone' in the Middle East. Furthermore, the resolution called upon Israel 'to accede to the Treaty on the Non-Proliferation of Nuclear Weapons without further delay...and to renounce possession of nuclear weapons, and to place all its unsafeguarded nuclear facilities under the safeguard of the IAEA'.

Now, from Forward, U.S.-Funded Report Urges Israel To Take First Step Toward Nuclear Disarmament By Ori Nir.

A new study commissioned and partially funded by the Pentagon urges Israel to take the first step in launching a nuclear disarmament process in the Middle East, arguing that such a move is the only way to block Iran's development of weapons of mass destruction and head off a regional arms race.

The report argues Iran has all it needs for nuclear weapons in the next 12-48 months and there is nothing we can do militarily or diplomatically to stop them.

The report recommends that the United States encourage Israel to "mothball" its Dimona nuclear reactor and agree to international monitoring. IF other Middle Eastern countries, including Egypt or Algeria, reciprocate regional halt to the production of fissile material could isolate Iran, the report suggests.

The report argues that once other countries in the region take similar steps to suspend their own nuclear-related activities, Israel could offer to close the Dimona reactor and place the nuclear material produced there under the supervision of a trusted international ally. IF Israel's neighbors — including Iran — reciprocate, Jerusalem would dismantle the Dimona reactor and hand over its weapons-usable fissile material to a third party, under the supervision of the International Atomic Energy Agency. (emphasis added to all IFs and COULDs

Once again, it is suggested Israel go first and hope others will follow. It wasn't Israel that said Iran should be wiped from the map. It was Iran that said Israel should be wiped from the map!

An Israeli official, speaking on condition of anonymity, dismissed the idea that Israel would lead a regional nuclear disarmament process in reaction to a nuclear-ready Iran. Israel's position, the official said, is that a nuclear-free Middle East could be achieved only through comprehensive regional peace treaties.

The Ezekiel Option has a lot to say about the kind of support Israel would get from its allies. The shame is that we taxpayers helped fund the making of this report

The Ezekiel Option Mover Mike

Rosenberg The Ezekiel Option

JackLewis.net has a reasonable explanation for the CNN "X".

I know we all want to think the worst since it's CNN!

CNN Mover Mike

Update: "Fred" in the comments section points us to a Team Hollywood press release. (Preska Thomas and Kevin Finn are the founders of Team Hollywood Global Networks, Inc., a marketing consulting firm that specializes in lobbying relations and consumer networking for Fortune 500, politicial, and entertainment companies. Team Hollywood has consulted for Vatican asignees and developed marketing strategies for the RMS Titanic, Mikhail Gorbachev, Bill Clinton, Sony, Carsey-Warner, QVC, and Nanotechnology. They are the authors of the book, The Index: A Road Map).

Maybe it wasn't an accident as Jack Lewis describes for when Team Hollywood called CNN they got a recorded message:

When the founders of the company, Preska Thomas and Kevin Finn, made contact with the network, to their surprise they were bullied and harassed in the same way by the Headline News desk. Callers were repeatedly told by CNN, "Tell the President and Vice-President Dick Cheney to stop lying." Team Hollywood's conversation with the newsdesk was recorded. When the tape is played back, amongst political statements being made by the network were the words that the "X" was intentional, as an act of free speech by CNN.

Stay tuned. More to Come!

Ron Franscell at Under the News reminds us of Hurricane Rita and her destruction in his post The delusion of fences

Now I live in Southeast Texas, where no fence could repel Hurricane Rita. Now, almost two months after the storm, the meager perimeter-defense of my cedar-plank fence has finally been rebuilt. The edges of my property are again defined from within and without. After two months of a fabulously free life, my dog can venture no farther into the world — and the rest of that world can venture no closer than my padlocked gate without my invitation. Whether this pathetic wooden fence is a rampart or a cage, it doesn’t matter. It comforts me that it exists again.

[...]

I’m not sure why it comforts me to be surrounded by fresh fences again. Maybe security? Maybe possessiveness? Maybe because what’s inside is mine

I immediately went digging for my Frost book of poetry and his poem Mending Wall by Robert Frost.

Something there is that doesn’t love a wall,
That sends the frozen-ground-swell under it,
And spills the upper boulders in the sun;
And makes gaps even two can pass abreast.
The work of hunters is another thing:
I have come after them and made repair
Where they have left not one stone on a stone,
But they would have the rabbit out of hiding,
To please the yelping dogs. The gaps I mean,
No one has seen them made or heard them made,
But at spring mending-time we find them there.
I let my neighbour know beyond the hill;
And on a day we meet to walk the line
And set the wall between us once again.
We keep the wall between us as we go.
To each the boulders that have fallen to each.
And some are loaves and some so nearly balls
We have to use a spell to make them balance:
“Stay where you are until our backs are turned!”
We wear our fingers rough with handling them.
Oh, just another kind of out-door game,
One on a side. It comes to little more:
There where it is we do not need the wall:
He is all pine and I am apple orchard.
My apple trees will never get across
And eat the cones under his pines, I tell him.
He only says, “Good fences make good neighbours.
” Spring is the mischief in me, and I wonder
If I could put a notion in his head:
“Why do they make good neighbours? Isn’t it
Where there are cows? But here there are no cows.
Before I built a wall I’d ask to know
What I was walling in or walling out,
And to whom I was like to give offence.
Something there is that doesn’t love a wall,
That wants it down.” I could say “Elves” to him,
But it’s not elves exactly, and I’d rather
He said it for himself. I see him there
Bringing a stone grasped firmly by the top
In each hand, like an old-stone savage armed.
He moves in darkness as it seems to me,
Not of woods only and the shade of trees.
He will not go behind his father’s saying,
And he likes having thought of it so well
He says again, “Good fences make good neighbours.”

Hurricane Rita certainly didn't love fences. Recently, I looked at pictures of the aftermath of Katrina on New Orleans, where parts of the city are left with no buildings standing, it would be comforting to see a fence. Maybe life seems too fragile otherwise.

rita katrina Mending Wall Mover Mike

From The Oregonian, Lobbyist pleads guilty in bribery case

Michael Scanlon, a former partner of lobbyist Jack Abramoff (and who is also a former aide to Rep. Tom DeLay), pleaded guilty Monday to conspiring to bribe public officials, a charge growing out of the government investigation of attempts to defraud Native American tribes and corrupt a member of Congress.
[...]
Scanlon entered his plea before U.S. District Judge Ellen Segal Huvelle and was ordered to pay restitution totaling more than $19 million to the Native American tribes that he admitted had been defrauded while he and Abramoff represented them.

Scanlon Abramoff Mover Mike

For a number of years there has been a ban by the MSM on news from GATA. Today, a chink appeared in the curtain. On CBSMarketWatch, Peter Grandich, editor of The Grandich Letter, was interviewed. The question was asked why the strength in Gold. The threat of inflation, jewelry demand, and central government (primarily Russia) buying," are factors said Oscar Nelson, gold trader at U.S. Global Investors. Grandich agreed and added one more factor — major players caught with short positions.

"I believe groups who have tried to artificially depress gold prices are in serious trouble and can cause a far greater rise than most assume today," said Grandich.

GATA has said the short position may be equal to 12,000 to 16,000 tonnes of gold.

gold Grandich Mover Mike

One of my nightly reads is Jim Sinclair's MineSet. Sinclair is a world class commodities trader who is trying to teach traders how to trade precious metals and the USD. His bio appears on his website. Among other things

He was also a General Partner and Member of the Executive Committee of two New York Stock Exchange firms and President of Sinclair Global Clearing Corporation (commodity clearing firm) and Global Arbitrage (derivative dealer in metals and currencies).

So when tonight he said

Oh my God. This one shocks me out of my socks. This might well be the most shocking thing I have ever read in my entire career when you consider the entities involved!

He is referring to the news explained here at FT, US pension accounting shift ‘would hit equities’ By Deborah Brewster

Proposed changes to pension fund accounting in the US are likely to prompt a shift of investment away from equities and into bonds while speeding the demise of defined-benefit plans, according to investment experts.

The accounting changes under consideration by the Financial Accounting Standards Board would require defined-benefit funds, which hold about $4,000bn (€3,399bn £2,336bn) in assets, to stop “smoothing” their returns and instead report actual returns each year.

I had to go and Google “smoothing” their returns and found the Federal Reserve Bank of San Francisco published Pension Accounting and Reported Earnings

...plan assets are not marked to market immediately. Rather, changes in the market value of plan assets are amortized over five years. Hence, a one-time gain or loss will be spread out over five years in determining the accounting value of plan assets that is used to calculate the expected return. The combination of using the expected rate of return and the market-related value, rather than the realized return and the marked-to-market value, in computing the dollar return on pension assets has the effect of smoothing pension earnings over time and, hence, the reported earnings (of a corporation with a defined benefit plan). (emphasis added)

So now you are a pension manager. Your bonus is based on maintaining an even level of growth.

In order to do this, Sinclair says you fudge the numbers with “smoothing” transactions in over-the-counter derivatives.

Sinclair says It is going to blow sky high and with it all those who have partaken of this total madness. (emphasis added)

Who are the companies that are running large underfunded defined pension plans?

MineSet Jim+Sinclair derivatives Mover Mike

Late Note: Gold at $493!

Looks like a winter storm is brewing for this Thanksgiving week.

By AccuWeather.com Dave Novak
Cold air will charge southward from Canada Monday and Tuesday. The cold surge will start in the northern Plains and the Upper Midwest. Strong northerly winds will drive cold air across the Dakotas, Minnesota, Wisconsin and northern Michigan. Temperatures Monday will struggle to reach the 30s in northern Minnesota and northern Michigan. The icy surge will trigger snow showers over the northern Great Lakes. The cold air will continue to drive southward into the Ohio Valley and Northeast Monday night and Tuesday. This cold push will interact with moisture over the Northeast and bring several inches of snow to parts of New York, Pennsylvania and interior New England.

Over at Weather Wars, Scott Stevens weatherman turned weather warrior predicts

A highly engineered jet stream pattern featuring a deep eastern North American trough which is greater than four Sigma's (standard deviations) from normal will be responsible for tapping an arctic air mass that will deliver sub-zero temperatures as far south as Des Moines, Chicago, Indianapolis, Cleveland and eastward to the Capitol District of New York. This cold air surging over the still warm waters of the Great Lakes will yield some fantastic snowfall totals that may exceed 72” by Sunday the 27 th of November.

He goes on to say regarding the fuel supplies

As we have all experienced during the past few weeks, our energy costs have come down substantially after the spike of September's hurricanes. This trend will be reversed this week. Massive distillate (finished products) petroleum imports from Europe ceased on or about the 10 th of November; these imports made up for what unrefined product remained shut-in across the Gulf of Mexico. Now we have record EARLY cold in the heavily populated Northeast accompanied by a minimal build in petroleum reserves and vast majority of Gulf production still off line. This will turn out to be a long cold winter. Conservation, food storage and firewood will be necessities.

I love prognosticators. No one ever remembers what you predicted and if you get one right you can always say, "See I told you!"

weather Scott Stevens Mover Mike

Update:

I've talked about Gold a lot in the past year! I believe that a new bull market was launched after the price of gold hit bottom at $250 in 2001. I have said that before it is all over, the price of gold will trade equal to or higher than the Dow Jones Industrial Average. Here's a point and figure chart of First Eagle Gold Fund (SGGDX) that begins in July of 2001. Besides the shares of the most recognizable names in gold mining, it has a large position in bullion, gold backed bonds and Newmont Mining (NEM).

The question to ask, has your mutual fund without precious metals performed as well. For most, I suspect the answer is no. In fact judging by conversations I have had, the last few years have been pretty miserable. I sense a discouragement on some of your parts and resignation that you will just have to wait it out. I believe that can be a long and dangerous wait.

A recent study by Ibbotson shows that gold mining shares have a negative correlation to the stock market,

“that precious metals performed best when they were needed the most by providing positive returns during the years that traditional asset classes had negative returns. Ibbotson determined that investors can potentially improve the risk-to-reward ratio in conservative, moderate and aggressive portfolios by including precious metals bullion with allocations of 7.1%, 12.5% and 15.7% respectively.”

Ask your broker for suggestions. It's about safety!

Disclosure: Mover Mike has a position in First Eagle Gold Fund and makes no recommendation or gurantee and is not compensated by First Eagle Gold Fund in any way. Past performance is no guarantee of future performance.

gold precious metals Mover Mike

PS: Bill Cara writes about Gold this morning.

Barrons November 19, 2005, carries an interview with Interview with John Hathaway, portfolio manager, Tocqueville Gold Fund By Sandra Ward

If it's gold you're after, John Hathaway, who runs about $550 million in the Tocqueville Gold Fund and another $400 million in separate client accounts, is the man for you. Year in and year out, Hathaway has delivered glittering returns, outperforming the benchmark Philadelphia Exchange Gold and Silver Index at every step. This year his fund (TGLDX) is up 15.3 percent, compared with a gain of 14.84 percent in the index, even though the performance of gold stocks has lagged behind the appreciation of the metal.

Focusing on what he considers to be undervalued gems with good growth potential has paid handsome dividends for Hathaway and his investors. If, as he believes, the price of the precious metal is heading toward four-digit territory, expect that streak to continue.

Barron's: Gold seems to be trying to make another run here. What's your outlook for the price?

Hathaway: In the very near term, I have no idea. But it is still a bull-market trend, and there are a lot of reasons for that, and we will see higher prices. People shouldn't be surprised to see gold trade in the four digits.

Barron's: What's behind the move higher?

Hathaway: There is so much paper around, there are so many financial assets, and it only takes a small diversion from financial assets into gold to push the price higher.

Barron's: But what would lead to that diversion?

Hathaway: People are buying tangible assets, and gold is tangible and probably one of the most liquid and, in some ways, the least risky of all the tangible assets.

Barron's: There doesn't seem to be a lot of it around.

Hathaway: There is not a lot of it around. If you took one-tenth of 1 percent of global financial assets and stuck them in gold, you would wind up with a couple of years of mine supply. It is a trade you can't do. But it still gets back to the question as to why people would get more interested in gold, and it's not all based on bearishness. India is getting more prosperous, and Indians like gold. China is getting more prosperous, and the Chinese like gold. More disposable income in Asia definitely helps gold.

Yet there are bearish factors behind the bull case for gold.

There is an ongoing currency debasing. Look at all the people who were bearish on the dollar a couple of years ago -- they've been been slammed because they put their money into the euro. They should have put it in gold. Warren Buffett just took a loss on part of his position in the euro. He was famous for being bearish on the dollar. How did he activate that? He took a €22 billion position because the euro was liquid and gold isn't.

Barron's: Are you surprised at the behavior of the euro?

Hathaway: Not really. It is a piece of garbage, really. There is no national treasury that stands behind it, but a committee of bureaucrats. Then there's the politics and social issues in Europe. There's a big difference in the growth rate between the U.S. and Europe, and there's a big differential in interest rates between the U.S. and Europe. Gold is going to rise against the dollar and the euro and the yen, which it has been doing for quite a while, but it has been doing it quietly, so most people aren't even aware of it.

There are still a lot of skeptics on gold. It's been five years since it's been in a bull market. Before that it had been in a bear market for about 20.

These days, the generations are much shorter. Residual skepticism is all over the place, and it is terrific because it gives the bull case longevity. If everybody were on board the way they are with energy, I would have to think of a new investment theme to work on.

Barron's: You have written about gold benefiting from a bubble in the U.S. Treasuries market.

Hathaway: The bubble is a reflection of the lack of investment alternatives. It is also a reflection of the perceptions of risk and the notion that Treasuries are a safe haven so they should be priced in a different way. There is so much money sloshing around the system, to the extent it is risk-averse it goes into Treasuries. On the other hand, you have negative real rates throughout the yield curve. Latest 12-month inflation is running about 4.7 percent. An investor has to go out almost 30 years on the yield curve just to get even. There is so much paper around and returns on assets are so hard to come by that it is driving money in this direction, and that's created the bubble. But these conditions are very favorable for gold.

Barron's: So what will focus people's attention on gold?

Hathaway: Hitting $500. That will fix attention. This has been a stealth bull market. Only years after a bottom has been made do people realize it.

Barron's: Hasn't there been a disconnect between the price of gold and gold shares?

Hathaway: Day by day, tick by tick, they don't do the same thing. But if you go back to 1999, which was the bottom of the bear market in gold, gold has gone from $250 an ounce to nearly double that. And the XAU, a benchmark for gold shares that most people use, has gone from the low 40s to around 115. For the last year or so, the shares have underperformed the metal to some extent, but over a period of time and on a historical basis, the shares give you more octane then the metal itself.

Barron's: Why are the shares underperforming?

Hathaway: Costs are up so much, particularly for open-pit mines, which use a lot of energy pushing dirt around and hauling it. The cost of building a new mine is up a good 30% over what it was five years ago. So the economics of the industry, even though the price of the commodity is up quite a bit, are essentially just as crappy as they were when gold was at its lows.

Barron's: Will consolidation in the industry help that?

Hathaway: Not really. They might help a particular company's business, but it is not going to change the economics. What would change the economics would be a $200-$300 price increase so that gold would then outperform commodities. Gold has underperformed other commodities by about 50 percent for quite a few years. That tells you oil, copper, and a lot of these inputs that gold producers need to get gold out of the ground have outpaced the price of gold. That is a fairly straightforward explanation of why margins have been poor. But there is another factor, and that is it is so easy for a gold company to get money. They have abused their ability to access what has been very low-cost capital by over-issuing shares. The stocks might be 20 percent higher if so many didn't declare open season on investors by issuing so much new stock.

Barron's: Do you take an activist role in that sense?

Hathaway: I'm very vocal about how investor-unfriendly the success of share issuance is. I'm particularly upset with the Canadian investment banks that do these deals.

Barron's: What's their defense?

Hathaway: The other side of it is that small companies, particularly the ones that are true exploration companies, are analogous to biotech stocks. They have properties that have potential value, but it takes a lot of money for drilling and exploration and metallurgical testing and feasibility before you actually generate revenues. Basically, they have to pass the hat all the time. Issuing shares is a quick and dirty way to get money, and for smaller companies, it's OK. But I object to any company that has a listing here in the U.S. on the New York Exchange or American Stock Exchange doing "bought" deals. [In such a deal, a new-share issue is bought entirely by one underwriter to resell to investors.]

Barron's: Is there any evidence that raising money has boosted production?

Hathaway: No. We just had a company in yesterday that is a particularly good example of this practice, and if you look at benchmarks like resources per share or ounces of production per share, they have been flat at this company for the last four years. So getting back to your question on why the shares have been sluggish in an environment in which the gold price is going up, it's because costs are way up and these companies issue stock without discipline.

Barron's: Haven't some gold stocks been hurt by strength in local currencies?

Hathaway: Certainly the South Africans were hurt because the rand went from something like 13 to the dollar to six to the dollar over a period of a year and a half or two years. That's like cutting the gold price in half. Even though the dollar price of gold has gone up, the rand price of gold is just now getting back to where it was a few years ago. To a lesser extent, strength in the Australian dollar and the Canadian dollar until recently squeezed margins for operations in those countries. But you get around that problem if gold is rising in all those currencies, which it is doing. But we have reached a point where gold isn't really linked to foreign-exchange rates because a lot of people are concerned about paper currencies in general.

Barron's: Yet central banks have been selling gold.

Hathaway: Central bank selling fills the gap between supply and demand. They have been selling at steady pace. What they have is an arrangement so their selling is orderly and doesn't spook the market. Under that arrangement, there is a quota system of 500 metric tons a year for five years. The selling is transparent, the market knows it is there, and if the program wasn't in place, gold could easily be $200 or $300 higher. We are in the second year of that five-year agreement, and it is hard to imagine where all that gold is going to come from.

Barron's: Who's buying?

Hathaway: They sell it into the market. We keep some of our gold in Switzerland, and I went to the facility where we keep it and basically it was a large refining company. They were melting down bars from the Swiss central bank, and at the other end of the production line there were semi-finished gold watch cases and jewelry for China, the Persian Gulf and India. That's where it is going. Central bankers are selling their best asset into the markets and it is going into non-monetary forms, and they will never get it back. They are just bureaucrats and not even held accountable for what they do on a financial basis. It has been such a bad trade for the last five years, you would think that at some point they would begin to say maybe we should hang on to what we have. But again, their general agenda is not to have gold as a monetary asset or at least not talk about it if they have it, because what is still true is that a rising price of gold is not a favorable reflection on public finance.

Barron's: What's the impact of gold exchange-traded funds on the market?

Hathaway: It is potentially huge. Right now there's about $3.5 billion in gold ETFs, which isn't bad considering the first one came out a little over a year ago. As we discussed, gold shares can be risky, yet gold is not necessarily an investment for those who are risk-seeking or risk-tolerant. Gold is essentially financial insurance. It is noncorrelated. It has hundreds of years of history of being noncorrelated with financial assets, which means that when financial assets are doing well gold doesn't do well. From 1980 to 2000, that was the case, but in the 1970s and 1930s, gold did very well. What the ETF does is open the door for people who should have exposure to gold. It makes it easy for a college endowment that would never typically open up a commodities account or open up an arrangement with a bullion dealer to own gold. The ETF paves the way for an entirely different class of investors to come into gold, not gun slingers looking for huge returns but people who just want to protect themselves.

Barron's: What risks are working in gold's favor?

Hathaway: There is a lot of financial risk in the system. The level of household debt, the housing bubble, the amount of U.S. Treasuries held by foreign central banks, the valuation of the stock market, the overvaluation of the bond market -- are all legitimate reasons to be concerned, not that I wish for worst-case outcomes. Secular credit expansions, which is what we had from 1982 through 2000, are often accompanied by an ever-decreasing perception of risk. We've been in a bear market since 2000 and people still don't realize it. Yet bear markets have a life of their own, and they really don't end until a certain psychology takes hold and people just hate financial assets.

Barron's: Are gold stocks attractive at this point?

Hathaway: One of the problems I have is that a lot of my positions are merging, so I'm forced to go down the food chain and look elsewhere for other things to own more of. Among the big producers, companies such as Newmont Mining [NEM], Gold Fields [GFI], Barrick [ABX] and, to some extent, Goldcorp [GG], aren't really growth vehicles. They can get a little bit bigger, perhaps, but if this Barrick merger with Placer Dome [PDG] goes through, for instance, the company will produce 10 million ounces of gold, and that's more than 10 percent of the market's annual global production. How much bigger can they really get? This is not a business that lends itself to size in the sense that one company could ultimately become 30 or 40 percent of the market.

When you are mining that much gold, you have to replace it every year, and if these guys can just replace what they produce and replace it with high-quality ounces, and keep their costs in line, they are doing a great job. They become perpetual options on the gold price. Newmont, for instance, should just say it will be a seven-million-ounce producer for the next 15 years, and that would create a certain instrument in the market- place, which is a long-dated option on the gold price with a very low cost of capital.

Barron's: What about the smaller companies?

Hathaway: On the other end of the spectrum are the pure exploration companies that are out there trying to find new reserves, and as the gold price goes higher, the Newmonts and Barricks of the world will be compelled to buy the junior names. We manage our portfolios by owning the best of the large companies that have this long-option characteristic to their shares and the best of the small-cap names where value can be created without the price of gold rising necessarily.

Barron's: What junior producers are attractive?

Hathaway: I want to be careful to list companies that are reasonably liquid. We own something called Yamana Gold [AUY], which has a very nice growth profile. They are in Brazil and have a great land package. It's got 190 million shares trading at 4.

Barron's: Are you expecting more upside?

Hathaway: Yes. They have a fairly well-defined ramp-up of growth in the next five years, and that is something that we look for. We also like Ivanhoe Mines [IVN] a lot. There are 300 million shares outstanding, so it has a $2.4 billion market cap. They have a huge discovery in Mongolia. Ivanhoe has a world-class copper discovery that just keeps getting bigger and has the potential to match Freeport McMoran's [FCX] big copper property in Indonesia in terms of its size. It is right near the Chinese markets, and it is economically very significant.

Barron's: Any others?

Hathaway: A third one is Eldorado [EGO]. It's an emerging producer with assets primarily in Turkey, which is geologically a very good place to be. It hasn't been picked over the way some areas have. It is not really a Third World country in that it has got First World infrastructure. It's got a billion-dollar market cap. Basically, what we look for is production ramping up so there is some growth component and prospective acreage and land packages allowing for more discoveries.

Barron's: Thanks, John.

-END-

gold John Hathaway Mover Mike

I am sick to death of the phrase "I support our troops, but not the war!"

No you don't! You want to jump on the Murtha bandwagon for the worst reasons. He is a military man through and through, tested in battle, a hawk. He is not saying our reason for going into Iraq was wrong. He is saying that we went in on the cheap and with too few men. He was saying in May of 2004, U.S. troops in Iraq are undermanned, inadequately equipped and poorly trained.

In February, I agreed with him when I wrote two posts about the inadequecy of our armored vehicles: M-113 APC's, C-130's and Military Spending and Armored Vehicles, Saudi Support, and Sales Tax on R.E.. We also, know that reservists are not equipped equally with regular army. Most of our casualties are still from IEDs.

"I support our troops, but not the war!" You never would have gone into Iraq. You are what Norman Podhoretz calls

The Liberal Internationalists This is the foreign policy establishment members of CFR and the Brookings Institute who believe that negotiations are the best and only way to resolve conflicts and have an undying faith in the UN.

That is not a bad thing in itself, you just need to be honest about your philosophy.

Another thing wrong with "I support our troops, but not the war!" That's BS! War is hell! Accidents happen in war, civilians get killed. Troops who have seen their buddies killed or dragged through the streets can go to far in retaliation. You are the first to turn on our own. If you must go to war, you want the thing surgical, clean and no body bags. However, you have no morality. You believe the ends justify the means, but you will do anything to avoid the consequences of your actions when things go wrong

I wrote Let us not leave until the job is done. My fear was we would cut and run, and our boys and girls will have died or been injured in vain. "Stay the Course" means get in do the job using awesome power and get out. Know going in that bad things will happen, that the enemy will do everything possible to make you wish you hadn't gone in.

One more thing. This country can not fight a guerilla war as we do now. In a guerilla war the enemy fades into the general population and brings down our multi-million dollar weapons with small change weapons. Look what a RPG can do to a helicopter. Look what IEDs are doing to our armored vehicles. To fight a guerilla war you must kill everything. Are you ready for that? Would you support our troops? During WWII, we destroyed whole cities. That's how you fight guerillas!

Read what our troops are saying about the war. They believe in their mission. They believe they are bringing freedom to Iraq. They see the Iraqi people and know they did the right thing by going in. They re-up and they willingly put their lives on the line, 9000 miles away from home, for us.

"I support our troops, but not the war!" Please!

Iraq Murtha Mover Mike

Sandy A asks a question: Has Bush borrowed more money than all of the previous 42 Presidents combined? I answered the question by looking at the cumulative deficits and said no. However, if you ask has Bush spent more money than all the past presidents combined, then I would answer yes.

Here is part of the budget from 1905 forward. We are like shareholders in this giant corporation called the US Government and I was amazed how hard it is, even with the internet to find this information.

Year--------On-budget (This budget excludes Social Security)

-------Receipts---------Outlays------Surplus or
-------------------------------------deficit (–)

1905 -- 544-------------567.............–23
1910 -- 676-------------694.............–18
1915 -- 683-------------746.............–63
1920 -- 6,649-----------6,358............291
1925 -- 3,641-----------2,924............717
1930 -- 4,058-----------3,320............738
1935 -- 3,609-----------6,412...........–2,803
1940 -- 5,998-----------9,482...........–3,484
1945 -- 43,849----------92,569..........–48,720
1950 -- 37,336----------42,038..........–4,702
1955 -- 60,370----------64,461..........–4,091
1960 -- 81,851----------81,341...........510
1965 -- 100,094---------101,699.........–1,605
1970 -- 159,348---------168,042.........–8,694
1975 -- 216,633---------271,892.........–55,260
1980 -- 403,903---------476,618.........–72,715
1985 -- 547,918---------769,615.........–221,698
1990 -- 750,314---------1,028,133.......–277,819
1995 -- 1,000,751-------1,227,173.......–226,422
2000 -- 1,544,634-------1,458,061........86,573
2001 -- 1,483,675-------1,517,057.......–33,382
2002 -- 1,337,852-------1,655,313.......–317,461
2003 -- 1,258,500-------1,796,908.......–538,408
2004 -- 1,345,326-------1,912,704.......–567,378
20052 - 1,491,482-------2,080,022.......–588,540
20062 - 1,584,359-------2,144,300.......–559,941

So, Sandy, to answer your question, did Pres Bush spend more money than all the other presidents combined? I am not going to add up all the numbers, but looking at it, I would say yes. I would also, say that since 1971 when we severed our relationship with gold, that you could say that about each president.

You will notice that tax revenues went down in 2002 and 2003. Partly due to 9-11 and the recession it caused. Yes there were tax cuts, but I don't think their major impact was until 2003. The big thing to notice is that in 2000 revenues and spending were about even. Now it's estimated that in 2006, revenues will be back to 2000 levels. However. look at spending, up almost 50%! Partly, it's the war, but it's all the other things we think we need like Drug Programs.

The biggest mistake was Nixon's, going off the gold standard. That freed the politicians to spend money with little restraint. IMO, criticising the tax cuts is so much BS. More money would be coming in to the vaults of the government and spending would be 50% higher again.

BTW, I apologize for writing like I was annoyed. We are closer in philosophy than you think.

Federal Budget deficits Mover Mike

May 7, 2004, Rep John Murtha:

We cannot prevail in this war as it is going today," Murtha said yesterday at a news conference with House Democratic leader Nancy Pelosi. Murtha said the incidents of prisoner abuse in Iraq were a symptom of a problem in which U.S. troops in Iraq are undermanned, inadequately equipped and poorly trained.

"We either have to mobilize or we have to get out," Murtha said, adding that he supported increasing U.S. troop strength rather than pulling out.

Nov. 17, 2005, Rep John Murtha:

It is time for a change in direction," said Rep. John Murtha, D-Pa., one of Congress' most hawkish Democrats. "Our military is suffering, the future of our country is at risk. We cannot continue on the present course. It is evident that continued military action in Iraq is not in the best interests of the United States of America, the Iraqi people or the Persian Gulf region.

[...]

Murtha, a Marine intelligence officer in Vietnam, angrily shot back at Cheney: "I like guys who've never been there that criticize us who've been there. I like that. I like guys who got five deferments and never been there and send people to war, and then don't like to hear suggestions about what needs to be done."

Referring to Bush, Murtha added: "I resent the fact, on Veterans Day, he criticized Democrats for criticizing them."

I am proud of John Murtha for telling it straight. We have been trying to fight this war on the cheap. We have been at war, but not on a war footing at home. We have been slow to armor our guys, slow to fix the prioblems with IEDs and slow to fix the Iraqi borders and invested in a "nation" that was artificially constructed by the British. I think we did the right thing in deposing Sadaam, but a terrible solution to what comes after. Finally, some one said Too little! Too late!

Iraq John Murtha Mover Mike

Pardon me, there is one politician that gets it:

Ron Paul in Too Little Too Late

November 14, 2005

Congress is poised to consider a budget bill this week in a vote both parties consider critical, but in reality the bill is nothing more than a political exercise by congressional leaders designed to convince voters that something is being done about runaway federal spending. Having spent the last five years out-pandering the Democrats by spending money to buy off various voting constituencies, congressional Republicans now find themselves forced to appeal to their unhappy conservative base by applying window dressing to the bloated 2006 federal budget.

Ignore the talk about Congress "slashing" vital government programs in this budget bill, which is just nonsense. This Congress couldn't slash spending if the members' lives depended on it.

Remember, this is a Congress that has increased spending by 33% since President Bush took office in 2001. And we're not talking about national defense or anti-terrorism spending. We're talking about a one-third increase in garden variety domestic spending. This is also a Congress that passed the 2003 Medicare prescription drug bill, the single largest increase in entitlement spending since the Great Society programs of the 1960s. So there's not much credibility to be found on Capitol Hill when it comes to reducing the federal budget.

The proposed bill calls for such tiny reductions in spending that frankly it's shameful for Republicans to claim it represents a victory for fiscal conservatism. And it's equally preposterous for Democrats to claim it represents some great threat to precious entitlements. The dollar amounts contained in the bill are so insignificant that both parties are guilty of meaningless grandstanding.

The budget reconciliation bill reduces spending by a mere $5.6 billion in a 2006 budget of nearly $2.5 trillion. This represents just a fraction of one percent, a laughable amount. Does anyone seriously believe the federal budget cannot be trimmed more than this? Consider that the federal budget was only about $1 trillion in 1990, a mere 15 years ago- and government was far too large and too intrusive then. After all the talk about deficit spending, this is the best a Republican congress and Republican president can come up with? What a farce.

Projections of big savings beyond 2006 because of this bill are pure fiction. Congress has no authority to pass budgets or appropriate money beyond the next fiscal year. Future Congresses will not pay one whit of attention to this bill, and its hopeful predictions will be forgotten.

Furthermore, we need to get our budget cutting priorities in order. Why are we cutting domestic programs while we continue to spend billions on infrastructure in Iraq? In just the past two weeks Congress approved a $21 billion foreign aid bill and a $130 million scheme to provide water for developing nations. Why in the world aren't these boondoggles cut first?

The spending culture in Washington creates an attitude that government can solve every problem both at home and abroad simply by funding another program. But we've reached a tipping point, with $8 trillion in debt and looming Social Security and Medicare crises. Government spending has become a national security issue, because unless Congress stops the bleeding the resulting economic downturn will cause us more harm than any terrorist group could ever hope to cause. And we're doing it to ourselves, from within.

Congress is running out of options in its game of buy now, pay later. Foreign central banks are less interested in loaning us money. Treasury printing presses are worn out from the unprecedented increase in dollars ordered by the Federal Reserve Bank over the past 15 years. Taxpayers are tapped out. Where will the money for Big Government conservatism come from?

Congressional Republicans and Democrats can posture until doomsday, but the needed course of action is clear. Declare an across-the-board ten percent cut for the federal 2006 budget, and focus spending on domestic priorities. If congressional leaders cannot take this simple step toward balancing the 2006 budget, they should at least not attempt to delude the American people that serious spending cuts are being made.

Let this be our rallying cry! Too Little! Too Late!

Ron Paul Mover Mike

Yesterday, Bill Murphy who runs Le Metropole Cafe posted a lengthy article outlining the evidence for our belief that the gold market is manipulated by the central banks and the bullion banks. That article has been posted online at FMNN's site. I urge you to read it and judge for yourself.

For seven years GATA has discovered one piece of evidence after another supporting our long-held contention that the gold market is managed by certain central banks and their agents, the bullion banks. It is a price-fixing case involving some very powerful people and institutions … in fact it is a Gold Cartel. The U.S. attorney handling the Samsung conspiracy conviction said in an interview this fall that the United States had experienced an "epidemic" of price-fixing cases in the late 1990s. All GATA has done is uncovered one of them, the grandest of all

gold Mover Mike

Hat tip to Bill Cara. Remember Don Luskin, well, CNN reports, the San Francisco-based MetaMarkets.com, a mutual fund company, board of trustees approved the liquidation of the $9.9 million OpenFund and the $1.4 million IPO & New Era Fund, according to a filing with the U.S. Securities and Exchange Commission.

Although the funds are being liquidated, the company itself said it is in talks to be acquired in order to offer similar funds via a larger group.

"The funds are a casualty of the economy. We've been through the worst bear market in 50 years, maybe 100 years," Donald Luskin, the chief executive of MetaMarkets, told CNNfn.com. "In these times, small innovative companies don't always make it. Large companies that stay away from innovation are usually the ports in the storm."

Yeah like Enron, WorldCom, Fannie Mae, Delphi, General Motors, the major airlines, Refco, etc. Do yourself a favor Don, buy gold!

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rita gold mover mike

If you are not sickened by this story of politicians on the take in our nations capital from the Mercury News (registration required), if you are not seriously thinking our system is broken and we need a new paradigm, then the People and US and National Enquirer magazines have seized your brain.

Lawmakers acted on heels of Abramoff gifts by JOHN SOLOMON and SHARON THEIMER

Nearly three dozen members of Congress, including leaders from both parties, pressed the government to block a Louisiana Indian tribe from opening a casino while the lawmakers collected large donations from rival tribes and their lobbyist, Jack Abramoff.

Many intervened with letters to Interior Secretary Gale Norton within days of receiving money from tribes represented by Abramoff or using the lobbyist's restaurant for fundraising, an Associated Press review of campaign records, IRS records and congressional correspondence found.

Lawmakers said their intervention had nothing to do with Abramoff, and the timing of donations was a coincidence. They said they wrote letters because they opposed the expansion of tribal gaming - even though they continued to accept donations from casino-operating tribes.

Many lived far from Louisiana and had no constituent interest in the casino dispute. (emphasis added)

Who's involved:

House Speaker Dennis Hastert, an Illinois Republican
Senate Democratic leader Harry Reid - Nev
Sen. John Ensign, R-Nev
Rep. Jim McCrery, R-La
Sen. David Vitter, R-La
Rep Tom DeLay, R-Texas
Rep. Pete Sessions, R-Texas
Rep. John Doolittle, R-Calif
House Majority Leader Roy Blunt, R-Missouri
Senate Finance Committee Chairman Charles Grassley, R-Iowa
Sen. Trent Lott, R-Miss
Then-Sen. John Breaux, D-La
Sen. Thad Cochran, R-Miss
Sen. Mary Landrieu, D-La

Sure, there are a lot of republicans there. That's because they control both houses and Bush is a republican. But, you can bet your last dollar that the names would be democrats if they were in power. It doesn't make any difference. If you need to raise at least $5,000 per day for your next campaign, all you think about is where do I get the next donation. I am also not calling for some national slush fund made up of tax payers dollars to fund elections. We need to find a way to clean up politics and cut the size of the federal government. We need an alternative to the Reps and Dems!

Abramoff casinosMover Mike

Update: Ed Morrissey at Captain's Quarters has been following the Abramoff story and gives more detail about the politicians.

Jim Sinclair's MineSet has a news item from Germany about the The SdK, a protective association of the capital investors e.V, and a German Deutsch Bank, admitting they have some substantial problems with gold derivatives. It appears the bank has asked the stock exchange in Stuttgart to halt trading pending clarification. One reader at MineSet says SdK, through the use of gold derivatives, might have ended up counterparty to transactions which may have lost 90% of the options value overnight!

Not only is the anti-gold crowd short 12,000 to 15,000 tons of gold, but they have written options against gold and their production. There is meltdown above $529 an ounce on these shorts and options from what I read. There is significant counterparty risk. Some central banks are expanding their reserves in gold by buying gold, and there are rumors that a bank that has leased their gold wants it back, BUT it has been sold. Now we have a German bank in trouble. We live in interesting times.

gold derivatives Mover Mike

Update: Thanks to Fred for help with German translation into English. I will update when I have more information. Mover Mike

Update: Le Metropole Cafe has a better translation of the German:

"Today it came to the attention of the SdK Investor Protection Association that apparently Deutsche Bank has considerable problems with its gold derivatives trade. What is of concern are the paper instruments known by identification numbers DB6181, DB6183, DB6184, DB6185, and DB6187. These paper instruments are the so-called Long as well as Short-WAVE Knock-Out Option Contracts, which have been trading on the Stuttgart and Frankfurt exchanges since 4 October 2005. According to the prospectus dated 3 October 2005, these refer to the sale of an ounce of gold at various strike prices. Due to the tremendous leverage provided by these products, which Deutsche Bank advertized on its website and in its printed publications, these option contracts were especially popular among investors. Just last week SdK referred to the attractiveness of these option contracts in a 'Gold Special' article in its publication entitled 'SdK Exclusive'. In a covert style action shrouded in mystery, Deutsche Bank attempted today by unilateral action to severely diminish the terms contained in the prospectus much to the detriment of investors.

"Accordingly, the reference relationship is supposed to be reduced from one ounce of gold per contract to one-tenth ounce of gold per contract. For those investors who already own them, the terms have been reduced by a factor of ten. The SdK has never known this type of action to have taken place before. Should such changes in the prospectus with negative consequences to investors be possible, then the credibility and trust in the entire German options and derivatives market would be irreparably damaged.

"For this reason the SdK has requested the Stuttgart exchange and Deutsche Bank to suspend the trading in these products until this matter is clarified."

It appears that the bank retroactively changed the definition of the options contract so that it is 1/10th the size and didn't bother to tell anyone! I hope we finally got that right!

Thanks to Le Metropole Cafe (by subscription only) for this heads up. State Reserve Bureau felt squeeze in '97. The FT is pointing out that the SRB copper squeeze that I have posted about is nothing new. Why, back in 1997 China was tagged with a "short and inability to deliver" Zinc, and a copper trader lost big, $2.6 billion by Sumitomo Corp., in 1996 which made the reputation of another famous trader Julian Robertson

What the FT is trying to foist on us is that these squeezes come at end of bull cycles.

"People have been trying to squeeze commodity markets for centuries, and this normally happens at the end of a bullish cycle when inventories get low and people start to panic about available supplies," said Stephan Wrobel, partner Diapason Commodities Management, a fund management group.

Don't you believe it this time. This time it's based on supply and demand. At the current prices, we are rapidly losing our ability to supply gold, silver, copper and oil. In the case of the gold and silver, it will take massive increases in the price to get the miners back to work and new exploration and new mines open. And it doesn't happen overnight. It takes years to bring a mine online.

gold silver oil copper Julian Robertson Mover Mike

Doesn't this make you feel good? Don't you feel more secure?

Thanks to Prudent Investor here's the federal debt since 1987:

11/15/2005 -- $8,066,143,318,410.41
11/14/2005 -- $8,052,330,154,252.81
11/10/2005 -- $8,050,739,770,455.58
11/09/2005 -- $8,034,610,660,541.64
11/08/2005 -- $8,036,664,225,238.54
11/07/2005 -- $8,031,589,402,361.42
11/04/2005 -- $8,028,449,101,487.38
11/03/2005 -- $8,028,204,675,510.52
11/02/2005 -- $8,021,480,952,298.81
11/01/2005 -- $8,015,272,000,177.94

10/31/2005 -- $8,027,123,404,214.36

09/30/2005 -- $7,932,709,661,723.50
09/30/2004 -- $7,379,052,696,330.32
09/30/2003 -- $6,783,231,062,743.62
09/30/2002 -- $6,228,235,965,597.16
09/28/2001 -- $5,807,463,412,200.06
09/29/2000 -- $5,674,178,209,886.86
09/30/1999 -- $5,656,270,901,615.43
09/30/1998 -- $5,526,193,008,897.62
09/30/1997 -- $5,413,146,011,397.34
09/30/1996 -- $5,224,810,939,135.73
09/29/1995 -- $4,973,982,900,709.39
09/30/1994 -- $4,692,749,910,013.32
09/30/1993 -- $4,411,488,883,139.38
09/30/1992 -- $4,064,620,655,521.66
09/30/1991 -- $3,665,303,351,697.03
09/28/1990 -- $3,233,313,451,777.25
09/29/1989 -- $2,857,430,960,187.32
09/30/1988 -- $2,602,337,712,041.16
09/30/1987 -- $2,350,276,890,953.00

SOURCE: BUREAU OF THE PUBLIC DEBT

I'm not picking on President Bush, although he has nopt vetoed one spending bill. I am picking on us, you and me, for electing such people. It reminds me of Rome. They are buying our votes with our money!

federal debt deficit Mover Mike

All of the precious metals are on the move today as is the USD. Gold is at $475+! FMNN has this news item which I quote in its entirety:

Maria Guegina, the Head of External Reserves Management for Russia, has announced that the country will be increasing its gold reserves as much as 100 percent, according to the Resource Investor. Guegina did not say when the purchases would begin or end.

Russia currently holds 5 percent of its reserve portfolio in gold, and Guegina indicated that a gold reserve of 10 percent would be preferred. Guegina says that an increase in gold holdings would make the reserve portfolio more optimal.

Russia currently holds 500 tons of gold in term deposit, monetary, and allocated form. It is estimated that Russia would need to purchase all of the gold it produces for the next three years just to stockpile another 500 tons. However the amount needed to hold a 10% gold reserve allocation is growing with the Russian economy. It was recently estimated that Russia makes $500 million per day exporting oil.

The decision is an indicator that confirms central banks are likely to shift from net sellers to net buyers of gold within the coming years.

staff reports - Free-Market News Network (emphasis added)

Add to that, yesterday, worldwide gold production is expected to be lower for the next four years.

Global gold production is set to decline dramatically over the next four years and this is set to generate a scramble for gold ounces, DRDGold chief executive officer Mark Wellesley-Wood said in the company's latest investor newsletter released on Tuesday.

gold precious metals mover mike

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Carrie Underwood, winner of the latest Americam Idol, will be appearing tonight on the CMA Awards. She has chosen to sing a song from her new album Some Hearts called Jesus, Take the Wheel. The chorus goes

Jesus, take the wheel
Take it from my hands
Cause I can't do this all my own
I'm letting go
So give me one more chance
To save me from this road I'm on

I think a lot of us can relate to those lyrics, whether it pertains to alcohol, drugs, some financial or emotional problem, dealing with a spouse or kids or some disease. Or when faced with fear as in a hurricane or war. When you know there is something bigger than you, that you can turn over your life and will to and let go and let God, then you feel a profound peace.

I have heard the song. It's catchy and she's definately a country gal.

Jesus Carrie Underwood Mover Mike