James Turk: Another commodity correction is behind us


10:55p ET Tuesday, December 5, 2006

Dear Friend of GATA and Gold:

GoldMoney's James Turk, editor of the Freemarket Gold & Money Report and consultant to GATA, writes in an essay published today that another brief correction in the commodities markets is over and that the commodities boom has a long way to go. Turk writes:

"The reason for this bull market in commodities will surprise no one. It's the U.S. dollar. There are people around the world who would rather own $1 million worth of zinc or copper or soybeans or any other commodity than $1 million in a bank account, and for good reason. The purchasing power of the U.S. dollar is being inflated away, and this inflation will no doubt worsen in the weeks and months ahead. But zinc is zinc; the value of zinc and every other commodity is based on their utility, and that utility cannot be inflated away."

China seeks direct talks with OPEC


By Jim Krane
Associated Press
Monday, December 4, 2006


DUBAI -- China wants to start direct negotiations with OPEC to secure a stable oil supply and an equitable share of the oil market, a top official said here Monday in comments that underline the Chinese economy's rapidly growing energy needs.

Zhai Jun, China's assistant minister of foreign affairs, told conference participants in Dubai that his country was trying to develop "a negotiating mechanism with OPEC."

Two big Asian central banks learn to live with dollar's fall


China seeks direct talks with OPEC

From the Financial Times, London
Monday, December 4, 2006


Asian central banks appear divided on how to respond to the falling US dollar. Several countries, including Thailand, South Korea, and Singapore, appear to have intervened to curb its decline against their currencies, while heavyweights Japan and China are taking a more benign approach.

British banks probed over adequacy of collateral from hedge funds


By Peter Thal Larsen
Financial Times, London
Sunday, December 3, 2006


London's largest investment banks are to face a wide-ranging probe into their measurement and management of collateral amid concerns that some may not be properly prepared for a sudden market downturn.

The Financial Services Authority, the City watchdog, has launched an investigation into the banks' systems for measuring and managing the collateral they demand from hedge funds, banks, and other trading counterparties.

Ted Butler: What happens at $100 silver?


5p ET Monday, December 4, 2006

Dear Friend of GATA and Gold:

Silver market analyst Ted Butler's new essay is a speculation on which silver-related investments will do best as the price of silver reaches $100. Butler's preference is for real metal rather than mining shares -- particularly U.S. silver eagles. His essay is titled "What Happens at $100 Silver?" and you can find it at GoldSeek's companion site, SilverSeek, here:

Britain's official inflation numbers are all lies too


Revealed: The Real
Rate of Inflation

By Edmund Conway
The Telegraph, London
Monday, December 4, 2006


The cost of living for many British households is up to four times the Government's published rate of inflation, The Daily Telegraph can reveal.

Millions of families are experiencing inflation far beyond the official rate of 2.4 per cent, new research suggests.

Agnico-Eagle's huge success: organic growth, no hedging


2:25p ET Monday, December 4, 2006

Dear Friend of GATA and Gold:

Today's Financial Post / National Post in Canada has a wonderful profile of Agnico-Eagle Mines Ltd., GATA's oldest financial supporter among producing mining companies. The company has reaped spectacular success in recent years by avoiding hedging and concentrating on what this profile calls organic growth.

Continuing its support, Agnico-Eagle was a sponsor of GATA's reception at the New Orleans Investment Conference last month. The company has been with us from the beginning, back in the days when it was considered bad for business and before GATA's case was proved and widely accepted. So we're deeply grateful for Agnico-Eagle's principled and fearless work on behalf of the gold cause and delighted with its well-earned recognition here.

Another Chinese scholar argues for shifting into gold


China Should Increase
Forex Holdings in Gold

By Gao Jie
People's Daily Online, Beijing
Monday, December 4, 2006


China's foreign exchange reserves have become a thorny issue for the government.

Experts around the world have suggested ways in which China might address the surplus of foreign exchange reserves. However, many of these simply involve consuming the excess which could easily lead to inflation.

Weak dollar will figure in OPEC's decision on production


OPEC to take weak dollar into account

By Ghaida Ghantous and Karin Strohecker
Monday, December 4, 2006


OPEC is worried by a fall in the dollar that is eroding member states' purchasing power and ministers will take up the issue when they meet next week to discuss new output curbs.

On Monday the dollar hit a 20-month low against the euro, punishing producers who sell their oil in dollars, when they buy goods and services from Europe.

U.S. believed happy with decline of dollar if it's 'orderly'


By Jitendra Joshi
Agence France-Presse
Sunday, December 3, 2006


The US administration appears unfazed as the dollar plummets on currency markets, giving a helpful trade boost during an economic slowdown, analysts believe.

But a danger lies in the dollar falling so far that it unleashes inflation, sparking retaliation by the Federal Reserve.