GATA writes to officials of new U.S. administration


10:30p EDT Thursday, January 11, 2001

Dear Friend of GATA and Gold:

With his "Midas" commentary tonight at, GATA
Chairman Bill Murphy has information of special interest to South
Africa. It is copied below.

A few weeks ago Murphy showed how an attack on the Australian dollar
seemed to be related to the gold cabal's need to induce Australian
gold producers to sell more gold. Tonight Murphy examined an attack
on the South African rand that seems inexplicable except for a
similar result: pressure on South African gold producers to sell more.

Of course there isn't proof here yet. But this should be of urgent
interest to South Africa's government as well as to gold mining
companies in that country on the eve of the visit of the GATA

If indeed the gold cabal is so desperate to protect its short
positions that it is prepared to strangle a whole country by
destroying its currency -- and not just any country, but the
struggling multi-racial democracy that liberated itself peacefully
and has become the hope of Africa -- then an undeclared war is
being waged.

We do think that this is what is happening, and that South Africa
must rise up to defend itself as well as the gold cause. GATA and our
lawsuit offer a way of doing it. And imagine the pressure that could
be turned against the gold cabal if a South African delegation of
government officials, mining company executives, and mining union
representatives came back to Washington with GATA to ask some urgent
questions of the new president, new treasury secretary, and the
Exchange Stablization Fund.

We ask our South African friends to raise with their elected
representatives and their news media the issue of the attack on the
rand and its possible connection to gold.

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

* * *

"Midas" commentary: The Rand? This Is No Small Matter

By Bill Murphy
January 11, 2001

There is nothing but selling as gold approaches the U.S. trading
hours. It is always the same. Once gold is sold off, it rarely
rallies either, and if it does, those rallies do not hold.

The selling by the gold cartel is once again attracting speculators
who are jumping on board. The open interest went up 6,187 contracts
yesterday on the steep gold selloff and now stands at 132,314

The world is back to being gold bearish to the hilt as the bullish
consensus dropped down to 17 percent this morning. It's probably
even lower now.

It meant little that the dollar was knocked down against most
currencies except the yen. The euro surged after some healthy German
economic statistics and is closing in on 96 against the dollar once

Silver just continues to meander.

From in South Africa:

"Rand will ride out 22-cent fall, says Reserve Bank.

"Johannesburg -- The Reserve Bank believed the currency weakness in
the rand was overdone and expected the currency to recover over time,
Bertus van Zyt, the bank's head of international banking, said

"The rand closed at a new low of R7.90 against the dollar.

"Analysts, most of whom were expecting the currency to start the year
on a strong ooting, were baffled and could only point to rumours in
the market.

"Analysts did not detect any general emerging market currency
weakness and that, together with the relative strength of the euro
and other currencies like the Australian dollar, indicated that there
was something peculiar to South Africa about the rand's latest fall.

"Speculation that the partial listing of Telkom could be delayed, or
that a South African company was buying pounds for a UK acquisition,
was cited as initial trigger for the selloff. Speculation about
possible exchange control relaxation in the budget next month was
also mentioned as a possible reason for the fall.

"Analysts said there was no reason to believe that any of the rumours
were credible, which made it even harder to explain the fall in the

"The rand's weakness overshadowed a strong performance by South
African equities."

In just the last five trading days, the rand sank lower from 7.5 to 8
to the dollar, before firming up a tad.

From the Sydney Sunday Times:

"Another highly-regarded South African-based economist, who declined
to be named, said he believed the rand's fall could be the result of
a speculative attack 'because lots of the trading against it' was by
known speculators.

"'I just wonder what is making them do it now, and not last week or
next week?' he added, saying that there was no fundamental reason for
the rand's demise."

Until late last year Midas surmised that much of the weakness in the
Aussie dollar was a raid by the gold cartel on the Aussie dollar to
build incentives for the Aussie gold producers to sell forward as the
gold price rose in Aussie dollar terms in regard to gold priced in
U.S. dollars.

That was the case until the gold cabal miscalculated and overdid it.
Most of the Aussies had reached their limit regarding forward sales,
and the high Aussie dollar gold price egan to cause concern among the
credit community that some of their hedge books were going under
water. I wrote much on that developing danger before that scenario
was flashed around by the press. It was not long after that Moody's
began to downgrade some of the Aussie producers' credit risk ratings.

Realizing they had gone too far and fearing Australian producer
buybacks as certain hedge book positions deteriorated, the gold
cartel backed off and possibly reversed course, as the Aussie dollar
has risen sharply, defying many predictions.

The gold cabal needs gold to be borrowed and sold into the physical
market to maintain their crooked scheme. They are so desperate that
they have called on the likes of such poor countries as Jordan,
Uruguay, Sri Lanka, Chile, and Bangladesh to do their bidding.

Based on the above South African Business Report article, it appears
that the desperadoes are now plunging the rand to induce South
African producers to hedge. While I have no proof of this, it fits
right into the cabal's modus operandi that GATA has seen in recent

It is the same old duck that we have come to know so well.

This story from Platt's pulls this all altogether. Once again the
Hannibal Cannibal bullion bankers are doing their thing:

"Johannesburg, January 10 -- South Africa's Harmony Gold said
Wednesday it does not foresee any problems in finalizing funding
arrangements for its Rand 1-bil ($126.58-mil) acquisition of the
Elandsrand and Deelkraal gold mines from AngloGold. The market here
has been buzzing with rumors that funding had become a problem.
However, Harmony's CEO Bernard Swanepoel said that negotiations are
progressing well.

"He did confirm, however, that Harmony is in discussions with the
banks about protecting the lenders. This means that Harmony might
have to buy put options on gold to serve as a cushion if prices fall
below a certain level. But this strategy could lead to some financial
losses if there is a rebound in gold prices. Harmony is one of the
few South African gold companies that chooses to remain unhedged."

It makes no sense that only a couple of months ago the economic
pundits were very bearish on the Aussie dollar and bullish on the
rand. Out of nowhere, and conveniently for the gold cartel, the
Aussie dollar rallied 10 percent off its lows (taking pressure of
some Aussie gold producers), while the South African rand is making
new lows against the dollar (even as many other currencies are
rallying against the dollar).

Then again, it makes perfect sense if one understands that there is a
gold cartel with an agenda and that they are still at it, using any
means possible to trash gold and keep their scheme going. The
alternative is to perch on a financial precipice of their own making.

The irony is that no matter what kind of short-term maneuvers they
come up with, they are still headed for that precipice....

The GATA delegation's trip to South Africa looks better by the

Rhoda Fowler, our South African press agent, is making things happen.
So much is going in the right direction that I now am going to leave
earlier than planned, two weeks from Saturday. That will give me
close to a week in Johannesburg and nearly a week in Cape Town,
where I will link up with Reg Howe.

The cholera problem is worsening dramatically in that part of the
world. Today 2,500 cases were reported in South African's neighbor,