MANCHESTER, Conn.--(BUSINESS WIRE)--Feb. 2, 2006--Cheuvreux, the equity brokerage house of Credit Agricole, the huge French bank, this week distributed a 56-page report that completely endorses in detail the findings of the Gold Anti-Trust Action Committee that the price of gold has been surreptitiously suppressed by Western central banks and that those banks do not have the gold they claim to have.
The report, written by Cheuvreux's mining sector analyst in London, Paul Mylchreest, is titled "Remonetization of Gold: Start Hoarding." It repeatedly cites GATA by name and foresees an "unprecedented" rise in the gold price, possibly accompanied by a spike to as much as USD2,000.
The report's executive summary says:
"We are raising our mid-cycle gold price estimate to USD900/oz from USD750/oz and see the possibility of a spike to USD2,000, or higher. Covert selling (via central bank lending) has artificially depressed the price for a decade.
"Central banks have 10,000-15,000 tonnes of gold less than their officially reported reserves of 31,000. This gold has been lent to bullion banks and their counterparties and has already been sold for jewelry, etc. Non-gold producers account for most and may be unable to cover shorts without causing a spike in the gold price.
"There is a supply deficit in the gold market of around 1,300 tonnes per year before any central bank selling and perhaps 700 tonnes per year after 'official' sales but before covert selling. This compares with world gold mine output of only 2,500 tonnes per year. Some central banks, notably Russia, are starting to buy gold.
"Gold acts as an early warning of potential crisis such rising inflationary/deflationary pressures and general confidence in paper currency, especially the U.S. dollar.
A strongly rising gold price could have severe consequences for U.S. monetary policy and the U.S. dollar. History suggests that gold always wins against an inflating paper currency (that is, one subject to excessive supply growth).
"Gold and gold mining stocks are poised for an unprecedented rise in prices and profile. Investors in UK/European equities need to assess the implications for their portfolios. ..."
The Cheuvreux/Credit Agricole report details GATA's findings in Chapter IV, "Analysis of the Gold Market," and concurs in them as "broadly correct."
"No financial house in Europe could be more part of the establishment than Credit Agricole," GATA Chairman Bill Murphy said today, "and now its endorsement of GATA is circulating among other big financial houses in Europe and around the world.
"This evokes what Adam Fleming, former chairman of Harmony Gold, now chairman of Wits Gold, said at GATA's Gold Rush 21 conference in Dawson City, Yukon Territory, Canada, last August, just hours before the current sharp rally in gold began: that just a little investment demand could take the central banks out of their gold 'in the blink of an eye.'
"A LITTLE investment demand? Credit Agricole's brokerage house has just declared: Start hoarding!"
Gold Rush 21, Murphy said, "was truly historic and decisive. It gathered the world's top experts on gold to spell out, explain, and publicize the gold price suppression scheme, and the conference issued the Dawson Declaration, an appeal for free markets in the precious metals as a matter of basic human rights."
A two-DVD set of the proceedings of the Gold Rush 21 conference, including a dramatic 25-minute video summarizing the conference, produced by the brilliant Vancouver videographer Trevor Johnston, can be obtained through this Internet link: http://www.goldrush21.com/
The Cheuvreux report on the gold market can be obtained at GATA's main Internet site here:
"As for gold itself," Murphy said, "you can get some from coin and bullion dealers, but as the Cheuvreux report gets around, there may not be much left."
For the most part I am a silver bullion person. The supply of silver will be so critical in the next two to five years that it will do much more than double. There are many reasons besides the shortage that will cause this to happen. I believe that silver will be at least six times what it is now during that time span.
Popeye- I enjoy reading your comments. You indicated today that silver will go up I believe 6 times it value now due to a shortage. Is it possible to ask you for your ideas on which silver stocks (American, if possible) are on your radar screen? Please reply at your convenience. Your cooperation is gratefully appreciated. Thank You, diz 10-4 PS: Have a great day and weekend!!!!
Dizzy, 1st I believe that everyone should have a certain amount of hard money assets, (gold, silver bullion) in their investment plans. I purchased my 1st 1,000 ounces of silver in 1990 when I believed that the supply/demand defecit would continue. Last year was the 18th straight year of silver supply/demand deficit. If the US dollar crashes as some believe it will, silver will still spend and if the dollar does not crash the new industrialization in China and other countries will put a strain on silver supply that will force the price of silver to new heights.
Most of my portfolio is in gold stocks because, if you think about it, as the price of gold and silver increases the cost of mining the minerals remains the same. So the price per ton of a gold mining stock will increase much more than that of silver. But as the metal prices increase the price of silver will increase at a much faster pace than gold. Taking those things into consideration I but gold stocks and silver bullion.
MMRSF, Madison Minerals is my favorite gold stock because of the low debt, low outstanding shares and their holdings. It is an exploration company that has property that is adjacent to a Newmont property that is currently being mined by Newmont. The Madison property has assay results that are slightly better than what Newmont is mining at the present time. MMRSF also has proven reserves in New Guinnea of over 1,000,000 ounces of gold and expanding.
My favorite producing gold mining company is Goldcorp, GG on the NYSE. They have 100's of millions in the bank and no debt. They are also free of any hedges.
My favorite small silver mining company is Shoshone SHSH. They have their own silver mine and mill as well as a forest and sawmill to make their own mine supports. This mine was into production before the silver prices fell to uneconomical mining prices. SHSH has very little debt, less that 20,000,000 shares outstanding and has been purchasing other properties in the area near their Lakeview mine.
Another silver favorite of mine is Sterling (SLRM). I like this company because they purchased one of the richest silver mines in the world at very low cost because they were willing to pay cash to the bankruptcy court when Sunshine went bankrupt. SLRM has under 20,000,000 outstanding shares.
Popeye- Thank you for your reply. It appears as though I have some DD to do this weekend to see which of the stocks you indicated is best for me. I am proud to say that I read this message board and have always received good educational advice and messages from those who furnished the info. Yes, this board is much better than RB. You guys are doing a great job, therefore, keep up the good work!!!! Again, thank you, and have a great day and weekend!! diz 10-4
The silver EFT will require about 130 million ounces according to the prospectus. COMEX does not have 130 million ounces and hasn't for quite some time. The EFT will need to buy the 130 million ounces before the EFT will be approved so that it will be available for trading. This should put heavy upward pressure on the price of silver.
There is no valid reason not to approve the silver EFT since a gold EFT has already been approved. But if the EFT is trying to acquire a total of 130 million ounces, which it needs to do, then we should see a nice upswing in the price of silver in the very near future. Since that much silver is not available I believe that it will be at least mid summer before the EFT is ready to be approved.
Gold Gains in London as Lower Prices Attract Buying by Funds
Feb. 28 (Bloomberg) -- "Gold rose in London after a decline in prices spurred some funds to buy the metal and after a warning from Newmont Mining Corp. that it would sell less gold this year increased speculation that supplies from mines will decline.
Gold fell as much as 1.1 percent yesterday after a drop in crude oil prices eased speculation about higher inflation. Some investors buy gold as a hedge against inflation. Newmont, the world's biggest gold producer, yesterday said fourth-quarter gold output fell. Equity gold sales for the whole of 2006 will also be lower, the Denver-based company said".
The area adjacent to Newmont is owned by Madison and has had slightly higher assay results than what Newmont is currently mining in the area. Lower production by Newmont makes the Madison property look enticing. There is a possible buyout of this property by Newmont in the not too distant future. Madison also has significant holdings in the Mt. Kare area in New Guinea.
Gold closed up $6.90 at $5.61.50 and silver closed up .11 at $9.74. The gold and silver ratio is now 57.65. Lease forward rates have leveled off and are not viable for rollovers or short selling. The short squeeze seems to be holding.
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