Dear Friends,

We received this note on Friday from noted UK gold author Tim Green who believes that Chinese buying of gold could be a significant factor going forward in the marketplace. Tim is the author of "The Ages of Gold" which is available on the GFMS (Gold Fields Mineral Services) website at: http://www.gfms.co.uk/

David Duval

"The story today that China has quietly increased its offical gold stocks since 2003 from 600 tonnes to l,054 tonnes is regarded here as very significant for the gold market.

Although it is a relatively small amount spread over several years, and bought from local scrap and mines, analysts here say it could signal a trend over the next few years. Gold still only accounts for 1.6% of China’s reserves, but it might make purchases on the open market. Even go for the propsed IMF sales, if they materialise. In short, it is an interesting signal.

No doubt it helped the price today. And will probably encourage investors – and maybe some other central banks with too many dollars.

Incidentally, I amused one leading analyst here this morning by pointing out that in Ages of Gold, I report Chinese Emperor Wang Mang in AD23 had gold stocks of l55 tonnes; so China today has only 7 times as much as 2000 years ago.   So there is room for further buying!

Best,
Tim"

Dear XXXX,

I am an admitted gold bug , (perhaps later to be committed). I have been reading your missives for 2 years now, and frankly can’t figure out which side of the fences you are on half the time. I am sorry that you seem to hold some animosity towards my mentor, Jim Sinclair. I find much comfort in the fact he is honest, knowledgeable, transparent and straightforward, with no hidden agendas. Unfortunately I don’t gain that feeling from your chameleon like writing. From today’s writing and on another note altogether, I highly doubt it will be the world’s poor that will be damned, regardless of what I choose to do with my gold.

CIGA Dave

Dear Dave,

This world is full of judgement, making people who simply hate for the sake of hate.

Asking them why does not penetrate the hatred that has no basis, however your note was kind and to the point.

Regards,
Jim

Jim,

Greenspan is whispering to Bernanke in this picture…

"Gold still represents the ultimate form of payment in the world."

"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard."

–Quote from Alan Greenspan

CIGA "The Gordon"