Jim Rickards: Fundamental analysis, fair value nullified by government intervention


1a ET Tuesday, July 27, 2010

Dear Friend of GATA and Gold:

Market analyst, historian, philosopher, and lawyer Jim Rickards of Omnis Inc. has given another great interview to Eric King of King World News, if an awfully depressing one, finding parallels between the fall of Rome and recent developments in the United States. But in one big respect Rickards has begun to sound like GATA, which doesn't depress us at all. Rickards tells King that the recent gold swaps undertaken surreptitiously by the Bank for International Settlements were probably meant to manipulate the gold market, and he wonders whether fundamental analysis of markets and fair value has any use amid pervasive government intervention in markets, which can always change valuations abruptly and thereby trump investors. This market intervention, Rickards says, invites investors to withdraw from productive enterprise and reserve their wealth in cash or gold.

This is much like what people heard at GATA's Washington conference two years ago: "The main purpose of central banking now is to prevent ordinary markets from happening at all." That is, "there are no markets anymore, just interventions":


Rickards' interview can be heard at the King World News Internet site here:


In addition, he has written an entertaining short essay for King World News, "The Myth of August," which you can find here:


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


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

A Canadian gold opportunity ready for growth

Join GATA here:

New Orleans Investment Conference
Wednesday-Saturday, October 27-30, 2010
Hilton New Orleans Riverside Hotel

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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: