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

Section:

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":

http://www.gata.org/node/6242

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

http://www.kingworldnews.com/kingworldnews/Broadcast/Entries/2010/7/26_J...

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

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2010/7/26_Ji...

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



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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:

http://www.prophecyresource.com/news_2010_may11.php