Froma Harrop: The inflated Greenspan helped bankrupt America


2:21p ET Sunday, January 29, 2006

Dear Friend of GATA and Gold:

GATA board member Wistar Holt of Holt & Shapard
Capital Management in St. Louis is sending to
his firm's clients the investment letter below,
which credits GATA's Gold Rush 21 conference for
substantially increasing interest in investing
in the precious metals. Holt has generously
allowed GATA to share the letter with you.

To purchase the two-DVD set of the video of
the proceedings of Gold Rush 21 and the dramatic
25-minute highlight video produced by GATA's star
videographer, Trevor Johnston, go here:

Or try the main GATA Internet site here:

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *


By Wistar W. Holt
January 30, 2006

Powerful and rewarding is how I would describe the continuing
secular bull market for gold and silver in 2005.Gold rose 18% to
$517/oz. while silver climbed 30% to $8.80/oz.Both metals now have
risen for five straight years.

From my original purchase in January 2001 at $255/oz. for gold and
$4.50/oz for silver, the metals have gained 103 and 95%
respectively. The best news: We're just getting started.

Let's recap the performance of our investment universe in 2005 in
light of the strength of the metals:


Agnico Eagle (AEM)+44%.Canadian analysts raised price targets in

Goldfields (GFI) +41%. After a poor '04, GFI benefits from weak rand.

Goldcorp (GG) +48%. Benefits from lowest cost producer/merger.

Harmony (HMY) +41%.Same as GFI, above.

Newmont (NEM) +20%-Underperformance due to lack of acquisition.


Coeur D'Alene (CDE) +2%. Higher production costs, lower volume.

Hecla (HL) -30%.Labor strike in Mexico;political risks in


Prudent Bear +2%.Consistent with flat equity market.

Safe Harbor -4%.The surprising strength of the dollar.

The rally in the precious metals and stocks continues in early 2006
where it left off in 2005. Only 30 days into the new year, gold has
ascended another $41 to $558/oz. and silver 77 cents to $9.57/oz.
These are 25- and 18-year highs respectively.Notable stocks thus
far are last year's laggards, Hecla, +26%, and Coeur D'Alene,
+22%.My expectation for these silver stocks is that they will
continue to be the leaders in 2006.Hecla should particularly
benefit from earnings improvement and the settlement in
Venezuela.Goldfields, +23%, shines as the first miner to report
stellar quarterly earnings amidst the massive leverage of higher
bullion prices. GFI's earnings grew 522% (.56 vs. .09) compared to
last quarter.

This may be the year when the Canadian junior miners thrive,
prompting my accumulation of up toeight small positions. Although
more speculative, these exploratory and developmental companies are
potentially more rewarding.To finance these new positions, the Safe
Harbor Fund and partial positions in Agnico Eagle and Goldcorp were
liquidated.Presumably, these juniors offer much more potential.

What is driving these higher bullion prices?

For years mainstream analysts and market letter writers attributed
it to anything from a weak U.S. dollar to rising oil to higher
inflation to terrorism.Ironically, gold and silver have recently
rallied amid a rising dollar, flat to declining oil prices, no
inflation (according to Federal Reserve officials as well as the
bond market), and limited terrorism. So, what goes?

Perhaps in a simplified manner it boils down to supply and demand.
After all, annual global demand presumably exceeds gold production
by 1,500 tons per year; the difference made up by central bank
sales. Plus, with higher production costs, global supply is
declining.Yet something dramatic must be happening to the demand
side of this equation.

Suddenly there are reports of rising foreign central bank demand for
gold in countries like China, Korea, South Africa, India, Russia,
Argentina, Iran, and the rich oil-producing nations in the Middle
East.Addnew foreign investor demand in China, Japan, and the
Middle East and one can see that gold is literally moving from the
west to the east. With our massively increasing deficits, perhaps
the U.S. dollar is not "as good as gold" anymore.

That gold is now rising against all fiat paper currencies is proof
that no unlimited government-printed currency is equal to gold.

Then again, why this sudden demand?

The answer may lie in a little-known conference,Gold Rush 21,held
in the town of Dawson City, Yukon, in August 2005.

Sponsored by the Gold Anti-Trust Action Committee (GATA), on whose
Board of Directors I serve, Gold Rush 21 was meant todisclose to
the financial world that the precious metals industry has been
manipulated and suppressed for years byinternational, central, and
bullion banks.

According to GATA's extensive research, more thanhalfthe supposed
30,000 tons of central bank gold holdings have been surreptitiously
sold or leased into the market. Much of this gold, having been
borrowed by bullion banks (JPMorganChase, Goldman Sachs, Citicorp,
Morgan Stanley, and Deutsche Bank) and sold short into the market in
a highly profitable carry-trade scheme, should supposedly be
repurchased and returned to the central banks. This potentially
explosive short covering is probably why gold rallied $10/oz. the
day after Gold Rush21 ended, having never exceeded a $6 or $7 daily
increase throughout this decade. Further, goldnow has increased
$122/oz. (28%) in justthe five months since Gold Rush21.

In a gallant effort toenhance its powerful message, GATA has
recently produced a professionally prepared DVD of the Gold Rush 21
conference. It contains revelations on the most critical aspects of
the gold market, deliveredbyauthorities on gold from all over the
world. A special guest will be master of ceremonies in Marchfor
theSt. Louis premier showing of the 25-minute summary videoof the
Gold Rush 21 DVD. (Details to follow.)

As GATA's critical message spreads from the Yukon to Russia to China
to the Middle Eastand to other gold-worshipping nations, demand for
this precious currency will grow exponentially. As many authorities
indicated at Gold Rush21, before this secular bull market is over,
the price may reach unfathomably into the thousands of dollars.

Wistar W. Holt
Holt & Shapard Capital Management LLC
212 N. Kingshighway Blvd., Suite 1027
St. Louis, Missouri 63108
Telephone toll-free: 877-367-6300


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Blanchard & Co. Inc.
909 Poydras St., Suite 1900
New Orleans, Louisiana 70112

Centennial Precious Metals
Box 460009
Denver, Colorado 80246-0009
Michael Kosares, Proprietor

Colorado Gold
222 South 5th St.
Montrose, Colorado 81401
Don Stott, Proprietor

El Dorado Discount Gold
Box 11296
Glendale, Arizona 85316
Harvey Gordin, President
Office: 623-434-3322
Mobile: 602-228-8203

Gold & Silver Investments Ltd.
Mespil House
37 Adelaide Rd
Dublin 2
+353 1 2315260/6
Fax: +353 1 2315202

Investment Rarities Inc.
7850 Metro Parkway
Minneapolis, Minnesota 55425
Greg Westgaard, Sales Manager
1-800-328-1860, Ext. 8889

178 West Service Road
Champlain, N.Y. 12919
Toll Free:1-877-775-4826
Fax: 518-298-3457
620 Cathcart, Suite 900
Montreal, Quebec H3B 1M1
Fax: 514-875-6484

Lee Certified Coins
P.O. Box 1045
454 Daniel Webster Highway
Merrimack, New Hampshire 03054
Ed Lee, Proprietor

Lone Star Silver Exchange
1702 S. Highway 121
Suite 607-111
Lewisville, Texas 75067

Miles Franklin Ltd.
3015 Ottawa Ave. South
St. Louis Park, Minn. 55416
1-800-822-8080 / 952-929-1129
fax: 952-925-0143
Contacts: David Schectman,
Andy Schectman, and Bob Sichel

Missouri Coin Co.
11742 Manchester Road
St. Louis, MO 63131-4614

Resource Consultants Inc.
6139 South Rural Road
Suite 103
Tempe, Arizona 85283-2929
Pat Gorman, Proprietor
1-800-494-4149, 480-820-5877

Swiss America Trading Corp.
15018 North Tatum Blvd.
Phoenix, Arizona 85032
Dr. Fred I. Goldstein, Senior Broker

The Moneychanger
Box 178
Westpoint, Tennessee 38486
Franklin Sanders
1-888-218-9226, 931-766-6066



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