Early Morning Gold Brief - Bank of Japan Intervenes at 107.61 in Yen

Nov. 19, 2003

The seriousness of the last four month's steady decline in non-US purchases of US financial assets cannot be overstated. This is a US dollar disaster of significance because the system of US consumerism, not supported by banked reserves of the consumer, has come to depend not partially but entirely on phenomena of endless purchases by non US entities of US Treasury instruments, the dollar equivalent. Yes, it was predicted here to happen, but down deep I wanted to be wrong.

No longer does it matter if gold will be up this day or the next. That is a game versus the seriousness of the protection of all you have worked for, your family. Akin to the military condition of "Broken Arrow" if your fire base was over run and you called in friendly fire directly on your post as the fighting became hand to hand. You are my troops and I am one of you, equal to all but no better than anyone. I care deeply for each and every member of this community of the best of the best, good folk. My dear friends prepare to defend yourself. May God protect us from our international financial leaders. The Piper has landed and is demanding payment for the madness of the last century. All paper currency is just that, paper with so politician's promise attached. Gold is the only answer so own it and do not release it for paper until I give the all clear signal, if I ever do. I am 62 and working more hours and harder than I have ever worked in my life for you, my family.

Yen, Euro and Gold trades at new highs before the Bank of Japan intervened. Intervention against a prevailing monetary trend supported by both fundamental reality and technical absolutes is a world class waste of money and has never reversed a market direction in all history. Intervention can run some weak shorts but for how long? The short covering this morning is already moderating as it only provides a new opportunity for additional sales of US dollars and purchases of Euros and Yen. Central Banks that intervene in markets should spend more time considering why the problem occurred in the first place but then that would be the rarest of all central bank activities, the consideration of right action.

The most bearish ever head and shoulders has completed on the dollar. An attempt to pull back to the neckline occurred and failed. There is no question in any market seasoned professional's mind concerning the direction now and for years to come of the US dollar. I have fought many market wars in my life time but never have I witnessed such a serious technical and fundamental deterioration of a long term nature in a currency. This is truly Armageddon for the dollar and therefore most sadly for the position and power of the country of my birth. How many men and women have labored and died in preserving this way of life?

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