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Yikes! Deutsche Bank recommends gold -- even a gold standard

Section: Daily Dispatches

3:18p ET Saturday, September 22, 2012

Dear Friend of GATA and Gold:

In its editorial today the New York Sun expresses amazement at the gold-friendly report published this week by Deutsche Bank, one of the world's major banks. As the Sun notes, that report, written by Deustche Bank analysts Daniel Brebner and Xiao Fu, doesn't just recommend gold as a currency and investment, a form of "good money" far superior to the "bad money" issued by governments -- it also muses sympathetically about restoration of a gold standard for money.

The Sun's editorial, "Germany Eyes Gold Standard," is posted at the newspaper's Internet site here:

The Deutsche Bank report itself quickly dismisses with contempt the "spurious" objection that "there isn't enough gold" to back currencies with. "The volume of gold is not important," the report says. "Instead it is the value that is ascribed to this gold that is important. A zero can easily be added to a paper bill to change its value; similarly it can be added to the value of an ounce of gold. Absolute values are in fact unimportant. ... Gold is infinitely divisible. Does it matter that a paper bill is backed by a gram or a kilogram of gold? Theoretically it shouldn't matter, in our view."

... Dispatch continues below ...


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As do so many of gold's friends, Brebner and Fu expect Western debt repudiation through inflation. "When one has accumulated too much debt," they write, "while the right thing to do is pay it back, the easiest thing to do is default and hope your creditor has a short memory. We believe the Western economies in general are biased toward the latter, whether they will admit it or not. We expect a soft default will likely be the preferable course of action -- a managed form of currency depreciation through various stages of 'quantitative easing' or successive bailouts by central banks of the banking system."

While it doesn't mention the logical consequence of a surreptitious devaluation policy -- manipulation of the gold market to help disguise the policy -- the Deutsche Bank report on gold may be more intelligent and candid than anything yet produced about gold by any major bank. So you might want to read it before Brebner and Fu are fired or demoted to the bank's mail room and the bank demands return of all copies or, signifying the prescience of the authors, Deutsche Bank itself crumbles under bad debts repaid in bad money and is acquired by the Musical Heritage Surplus Club of Hong Kong, a subsidiary of the People's Bank of China. For the time being the report is posted at GATA's Internet site here:

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

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Prophecy Platinum Intercepts Best Pt+Pd+Au Grades Yet
at Wellgreen Project in Yukon Territory: 5.36 g/t

Company Press Release
Tuesday, September 11, 2012

VANCOUVER, British Columbia -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) announces more results of its 2012 drill program on the company's fully-owned Wellgreen platinum group metals, nickel, and copper project in southwestern Yukon Territory, Canada. Four surface holes and four underground holes all intercepted significant mineralized widths, ranging from 28.5 meters (WS12-201) and up to 459.5 metres (WS12-193). Highlights include WU12-540, which returned 8.9 metres of 5.36 grams per tonne platinum, palladium, and gold; 1.73 percent copper; and 1.01 percent nickel within 304.5 meters of 0.66 g/t platinum-palladium-gold, 0.20 percent copper, and 0.27 percent nickel.

The surface drill program started in June and has completed 16 holes (assays pending for 12 holes) with two rigs now on site. The surface program continues to progress at a steady pace.

Prophecy Chairman John Lee commented: “Wellgreen is a very large nickel, copper, and platinum group metals project with near-surface high-grade zones. High-grade intercepts will be incorporated into resource modeling and mine planning in the pre-feasibility study. We expect further positive drill results from Wellgreen shortly.”

Wellgreen features a low 2.59-to-1 strip ratio, is situated at an altitude of 1,300 meters, and is only 15 kilometers from the two-lane paved Alaska Highway. Those factors significantly minimize the project's indirect costs.

For the complete company statement with full tabulation of the drilling results, please visit: