9:17p ET Tuesday, February Dear Friend of GATA and Gold: Below is GATA Chairman Bill Murphy's special "Midas" commentary tonight for his subscribers at www.LeMetropoleCafe.com. Note particularly its quotation of commentary that was distributed today by Prudential Securities. The Prudential commentary focuses on ... GATA. While it seems not to want to believe it, Prudential indicates that GATA is influencing both the conduct of the suppressors of the gold price and the gold market itself. This is huge recognition for the work GATA and its supporters are doing for the gold cause, and an indication that we're getting close to success. Like us or not, we're a factor in the gold business now, doing the work that the World Gold Council should have been doing and might have done if it had not been terrified of standing up for gold's traditional monetary functions; terrified of standing up for gold's use as money, which is infinitely more important than its use as mere jewelery, with which the council has contented itself; terrified of standing up for the council's own industry; terrified of confronting the powers aligned against gold; and terrified of acknowledging that gold is and must always be the direct competitor of those powers. Imagine what could have been accomplished by now if the gold council, amply funded despite the gold industry's horrifying decline, had not left this work to little GATA over the last two years. Well, as bemused as Prudential Securities may be that we're moving the gold market, we're going to keep working at it. People all over the world are coming forward to help us. The industry itself is waking up. Don't despair; we're getting close. If one avenue is closed to us, we'll find another. We can win because we're right, no matter the power against us. Lincoln knew it: "Let us have faith that RIGHT makes might, and, in that faith, let us, to the end, dare to do our duty as we understand it." CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. * * * MIDAS COMMENTARY FOR FEBRUARY 27, 2001 By Bill Murphy www.LeMetropoleCafe.com February 27, 2001 The one-month lease rate soared today, flirting momentarily with 5 percent and settling around 4.68 percent. The stress on the gold cartel and in the physical market is building noticeably. Gold closed up $1.50 to finish at $266.70. Volume was VERY heavy at 58,000 contracts, which means the big shorts are using up a lot of ammo trying to keep the gold price from exploding. They threw the kitchen sink at the gold longs today. The Comex open interest declined only 1,795 contracts on yesterday's big move up -- another disappointment for the bears. The gold price in Aussie dollar is 512 and not far off its 522 highs. Remember the last time the Aussie gold price went that high -- the heightened concern in the financial community about the possibility that hedge books of some of the overly hedged Aussie gold producers would go so far under water that they would sink for good. Why should those fears be less today when the physical gold market is so much tighter? The following comes from Cafe member Sean, who prefaces his remark with an excerpt from an article in the South African newspaper, Business Day, the country's equivalent of The Wall Street Journal: * * * "Perhaps central banks that traditionally have lent gold have become more reluctant to lend out their bullion, making speculators' lives more difficult. It is not inconceivable that our own Reserve Bank has played a quiet role, as the Bank has been a gold leasing player." http://www.bday.co.za/bday/content/direct/1,3523,800329-6094- 0,00.html Not "inconceivable," maybe, but BREATHTAKING all the same! The South African Reserve Bank's balance sheet shows $14.5 billion forward sales against ALL foreign exchange and gold reserves. Were they selling their own country short until GATA visited? * * * >From South Africa's Business Day on Friday, February 16: "Standard Bank group economist Iraj Abedian has suggested that the government refuse to do business with fanancial institutions that attack the rand. He said rumours that have damaged the rand have consistantly emanated from three or four houses...." A South African Cafe member called up Abedian and complimented him on his statement. Our guy asked Abedian who the banks were, but he was reluctant to answer. Your fellow Cafe member said, "OK, how about if I name 4 banks and you just say warm or cold." Abedian agreed. Your Cafe member then rattled off four of the five bullion banks in the Gold Cartel as cited in Reg Howe's complaint. The response from Abedian: "Very warm!" * * * PRUDENTIAL SECURITIES COMMENTARY February 27, 2001 Certainly there their is no "shortage" of short sellers in the gold market. Indeed, gold-investment industry elements have gone so far as to file legal action in U.S. federal Court against the U.S. Treasury and several prominent investment banks, claiming a conspiracy exists among G-7 central bankers to keep the price of gold depressed so as to hide the current account vulnerability of the U.S. dollar. We reserve comment on GATA, the industry group staking the conspiracy claim, as we have philosophical opposition to GATA's thesis, since gold remains the SINGLE BEST deflationary indicator, bar none, and since it -- and inflation -- peaked in 1981. However, let us digress and imagine ... create and conspire ... SUPPOSE ... that GATA is right, and an elaborate network of gold-bug-squashing banks conspire and covert daily to manipulate the price of gold via an extensive lending program. Then SUPPOSE the influence of GATA's lawsuit has put these entities under such scrutiny that they fear a misstep, and are thus paralyzed by the glaring spotlight. IF under such circumstances, as farfetched as they may be, a bank has a problem acquiring material to honor one of the thousands of forward sales most assuredly needed via such a scheme. Whereas BEFORE the spotlights were glaring, this bank presumably could have "conspired" to acquire short-term physical from, say, a central bank, perhaps NOW that is not so easily done without risking detection and exposure for the conspirators. In such a case, gold lease rates WOULD begin a STEEP and BROAD rise. Hey, maybe just like in the last week. * * * Couldn't have said it better myself! -END- Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/