Published on Gold Anti-Trust Action Committee (http://www.gata.org)

Izabella Kaminska: Looks like BIS swaps relieved gold market squeeze

By cpowell
Created 2010-07-22 20:22

4:22p ET Thursday, July 22, 2010

Dear Friend of GATA and Gold:

Gold market blogger Izabella Kaminska has examined data for the New York Commodities Exchange's gold inventory and finds that while inventory is nominally high, the metal actually available for sale is relatively low on a historical basis. Recent negative gold lease rates, she writes, have signified tightness in the physical market.

"That is to say," Kaminska explains, "we used to pay for borrowing money from the bank -- pledging gold as collateral. Now we get paid for borrowing money from the bank -- pledging gold as collateral. We wonder why. In which case, the Bank of International Settlements getting involved in the 'cash for gold' market might make perfect sense -- especially if its real aim was to reset the stakes. We note that three-month lease rates, for example, did coincidentally go positive over the supposed gold swap action."

Kaminska's commentary is headlined "The Story of the Gold Curve So Far" and you can find it at FT Alphaville here:

http://ftalphaville.ft.com/blog/2010/07/21/287566/the-story-of-the-gold-... [1]

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


Prophecy to Become Coal Producer This Year
with 1.5 Billion Tonnes of Resource

Prophecy Resource Corp. (TSX.V: PCY) announced on May 11 that it has entered into a mine services agreement with Leighton Asia Ltd. to begin coal production this year. Production will begin with a 250,000-tonne starter pit as planned in August, with production advancing to 2 million tonnes per year in 2011. Prophecy is fully funded to production and its management team includes John Morganti, Arnold Armstrong, and Rob McEwen.

For Prophecy's complete press release about its production plans, please visit:

http://www.prophecyresource.com/news_2010_may11.php [2]

Join GATA here:

New Orleans Investment Conference
Wednesday-Saturday, October 27-30, 2010
Hilton New Orleans Riverside Hotel
http://www.neworleansconference.com/redirect.php?page=index.html&source_... [3]

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http://gata.org/tshirts [4]

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal [5]

Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon:

http://www.goldrush21.com/ [6]

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GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

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http://www.gata.org/node/16 [8]


Sona Resources Expects Positive Cash Flow from Blackdome,
Plans Aggressive Exploration of Elizabeth Gold Property

On May 18, 2010, Sona Resources Corp. (TSXV: SYS, Frankfurt: QS7) announced the release of a preliminary economic assessment for gold production at its flagship Blackdome and Elizabeth properties in British Columbia.

Sona Executive Chairman Nick Ferris says: "We view this as a baseline scenario for gold production. The project is highly sensitive to the price of gold. A conservative valuation of gold at $1,093 per ounce would result in a pre-tax cash flow of $54 million. The assessment indicates that underground mining at the two sites would recover 183,600 ounces of gold and 62,500 ounces of silver. Permitting and infrastructure are already in place for processing ore at the Blackdome mill, with a 200-tonne per day throughput over an eight-year mine life. Our near-term goal is to continue aggressive exploration at Elizabeth and develop a million-plus-ounce gold resource, commencing production in 2013."

For complete information on Sona Resources Corp. please visit: www.SonaResources.com [9]

A Canadian gold opportunity ready for growth

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