TAYLOR ON GOLD & STOCKS
Congressman Ron Paul, M.D. says U.S. Treasury confiscation of gold would be
illegal.
Several months ago, I received a part of an article that stated that the
Secretary of the Treasury could confiscate private gold any time he so
chooses. The article referred to U.S. Code (12 U.S.C. 248(n)). In
November I finally got around to writing to Congressman Ron Paul to ask him
this were true.
Earlier today, I received Dr. Paul's answer to my question. He said
"Congressional Research Service, statutory authority for the Treasury
Secretary to confiscate gold was repealed in 1982." But then, Dr. Paul
stated, "Of course, the Treasury probably intervenes in the gold and silver
markets through the Exchange Stabilization Fund. I am working on
legislation that would restrict the Exchange Stabilization Fund's ability
to interfere in, and thus distort, the gold market."
In my letter to Congressman Paul, I also gave him a brief eye witness account of the move to dismiss Reginald Howe's anti-gold price fixing case
that took place on November 5, 2001. Dr. Paul responded by saying "Thanks
also for updating me on Reginald Howe's lawsuit. While I wish Mr. Howe well
in his efforts, I must confess that I am skeptical of whether the federal
judiciary will limit federal power absent clear indications of public support for a return to constitutional government. This is why I believe defenders of liberty must continue to concentrate on educating our fellow citizens of the benefits of a free society."
To that I would like to respond to Congressman Paul that at least part of what GATA and Reginald Howe are trying to do is educate people about the
problems caused when constitutional freedoms are being abolished by the
government. To be sure, many if not most people associated with GATA have a self interest at heart. But it is clear to those of us who have studied the
gold rigging mess, how destructive our government is to cause of freedom by
this intervention.
Of course, in my view, no elected official in Washington comes closer to
educating Americans about the libertarian values instituted by our founding
fathers and the need to retain those values than Dr. Paul. If ever there
was a politician who has gone to Washington to serve his country rather
than to be served, it is Dr. Paul. As a physician who has delivered 4,000
babies he doesn't need a job in Washington. He ran for office because of
his passion for liberty and the need to help others understand why we MUST
hold on to it if we are going to retain any semblance of freedom that our
Founding Fathers envisioned when they framed our Constitution. Dr. Paul
understands how printing money undercuts our liberties and leads to the
formation of a rich, powerful ruling elite who uses their power gained via
the printing press to effectively rob hard working Americans who actually
produce our nation's wealth. And, much to his credit, he has been very
concerned that certain policies instituted post September 11th, may erode
the very values we are supposedly fighting for.
You can tell Dr. Paul is an honest statesman who loves his country because
he takes on positions that are not politically correct, but those which he
so passionately believes in. I thank God for Dr. Paul. If we had 434 more
like him - in terms of a willingness to selflessly serve America -- our
democratic republic would not be facing the demise it is now facing. And
with respect to the much smaller issue about a rigged gold market, GATA and Reginald Howe would not need to spend so much time fighting for something they should never, under our Constitution ever need to contest.
I would strongly suggest investors visit Dr. Paul's web site at
http://www.house.gov/paul to keep up with his latest speeches and bills he
is sponsoring in the House of Representatives. And Oh yes! I believe I
recently saw someone on the Internet suggesting that a "Ron Paul for
President" move should begin. I'm not sure it would be fair to Dr. Paul to
subject him to the indignities of running for that office. He's much too
kind and decent of a man to put up with the pernicious sniping aimed at
anyone who seeks that office. But if he were willing to run again (I
believe he ran on the Libertarian ticket some years ago), whoever it was
that suggested a draft "Ron Paul for President" you can count on my
support, for what ever that is worth.
When the Kondratieff blizzard really hits our nation with its full force, the thing I fear more than loss of material comfort is that the U.S. is likely to turn toward a dictatorship of some strip or another. At a time like that, who knows. Ron Paul may be predestined to play a more prominent role in defending liberty than he now plays as a Congressman.
CARTEL CAPITULATION WATCH HIGH ALERT !!
Following were some very important comments from GATA this past week that I think spell a very bullish scenario for gold.
"Standard & Poor's downgraded its rating of J.P. Morgan Chase from "positive" to "stable" this afternoon. That fits right into the Midas
financial scene scenario presented to the Café for many weeks. I suggest it
is only at matter of time before Morgan is rated "unstable" due to their 23
trillion interest rate derivative position - one that has to be threatened
by the current chaos in the bond market.
"Both the stock market AND bond market were hammered in the U.S. The long bond closed at 99-21/32, down 24 ticks, while the S&P closed at 1123, up 4 points.
"The bond and stock technicals are terrible. What is worse is the spin
coming from the CNBC/Wall Street crowd on the 'raison d' etre' for the
price action of both. It is inept, pitiful and irresponsible in some cases.
They seem to be lost in "Wally World," refusing to look beyond their nose
at serious problems financial issues staring right at them.
"Yes, something is "very wrong in financial land." Can't use that line enough!
"The following headlines appeared one after the other on Bloomberg this
morning:
"*Lucent Sees First-Quarter Sales Falling as Much as 35% From Fourth
Quarter *Ciena Has Fourth-Quarter Loss of $1.8 Billion on Write-down;
Shares Slide *Retail Sales in U.S. Dropped 3.7% in November; Excluding
Autos Fell 0.5% *Aetna to Eliminate 6,000 Jobs; Earnings Will Be Reduced
by $125 Million *Qwest Will Cut 7,000 Jobs, Expects $400 Million to $600
Million in Cost.
"For back to back headlines, they are about as bad as I have seen and does
anything but portend the vigorous economic recovery called for by Wall
Streeters analyzing the rising bond yields.
"Almost unbelievably, the spin on CNBC today from one "out of it" pundit
was the job layoff news was really good news because it means the Fed
will liquefy the financial system even more. Great!
"Then, we have the requited Enron story:
"New York, Dec. 13 (Bloomberg) -- "Energy companies such as Enron Corp. and Calpine Corp. have borrowed money to bolster their electricity trading
and generation, sometimes keeping their loans off the books to impress
credit ratings companies. Now the credit raters are asking questions
about off-book debts."
"Looks to me like the energy companies have taken a cue from the IMF. The
august IMF instructs its member central banks to account for gold
reserves that are swapped out of the central bank to leave them on their
books as if the gold reserves were still in the bank. The only purpose I
can think of for such a curious maneuver is to deceive the general public.
"No wonder the financial scene has begun to disintegrate!
"Bulletin-type info just in to The Cafe from the New York money manager
scene: Word is spreading - "The Enron debacle is worse than the LTCM
nightmare and extends far and wide into the world financial system."
"Gold and silver were not allowed to trade today according to the dictum of
the troubled Gold Cartel. Same óle, same óle.
"While the U.S. stock and bond market were battered, the dollar (which
broke down technically yesterday and should have followed through on the
downside based on the financial market action and news in the U.S.)
suddenly rose 50 points late in the day, led by a fall in the euro. ????
"Can only come to one conclusion: the Working Group on Financial Markets
pulled out its magnet and intervened again, trying to avert a complete rout
of the U.S. markets. Thus, the dollar rose up to 116.33, basis the March
dollar contract. That defies everything that happened today in the U.S.
financial scene. It is like an apple falling off a tree and going up
towards the sky.
"How can one U.S. political/government official after another keep on
praising our free markets? If nothing else, their timing stinks.
"The rigging of the U.S. financial markets, set in motion by the rigging of
the gold market 7 years ago, is starting to fall apart.
"The action of the bond market is telling us the "jig is up." The Gold
Cartel is in big, big trouble. This is a bad lot, this cabal. The pain they
have inflicted on others and are going to inflict on Joe and Jane public in
the future is horrifying.
"They must pay for what they have done. One does not have to wish "bad" on anyone. The outrage emanating from public disclosure of the gold scandal will do in The Gold Cartel scoundrels."
December 17, 2001
Jay Taylor, Editor of J Taylor's Gold & Technology Stocks
http://www.miningstocks.com
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