Train Guy,
It takes 1-2 years to push an abatement through in my town...good luck right now while real estate is hot and deficit spending at the local levels are occurring. Not exactly the amicable solution I'm looking for now. That idea of abatement will come later.

Hi Dan,
Been busy at work and lurking in the wings...but I read posts here frequently. Your in the right camp with gold.

Not looking for a free lunch...trying to keep my profits accumulated.
"If you need money, do a refi with a cashout, or get an equity line of credit.".....I don't and that's why you misread me. I want TO LOCK IN the current value of my house without selling it. Was wondering if there were derivatives or insurance riders for an option like this. Free lunch? Please....save it.

Dan,
You see this one?

Newmont is Telling J.P. Morgan to "Take a Hike!" The following was reported from GATA Thursday: "The big gold news of the day concerns gold derivatives. There is a commotion going on behind the scenes in the bullion-banking world. Word has it that Newmont Mining is taking it to one of the Hannibal Cannibals, JP Morgan Chase. It has to do with their Yandal operation in Australia, which Newmont inherited when it took over Normandy. That property has 3 million ounces of gold reserves with a 3.7 million ounce hedge on - one that is going underwater as the gold price soars. Morgan has called Newmont for a margin call. Supposedly, Newmont is telling Morgan to stuff it, or more appropriately, if you insist on the margin call, the property is yours. I'm told that Newmont is willing to buy back their hedges from Morgan, but only for so many cents on the dollar. In other words, they are playing hardball. Newmont can walk because the property is "fully encircled," meaning it is a stand-alone project. Of course, it won't do much for their bullion-banking relationships. "The following was filed yesterday with the SEC: http://www.sec.gov/Archives/edgar/data/891088/000095013003003747/d6k.htm "Newmont Yandal Operations Limited ("Yandal") advises that on May 21, 2003, it received a notice from a gold hedge counter party alleging a right to terminate a gold hedge counter party contract with Yandal before its scheduled maturity, based on the alleged occurrence of an early termination event under the contract. Yandal estimates the payment required to be made under the contract would be approximately U.S. $46 million based on an assumed spot gold price of A$560 per ounce. "In addition, Yandal also received notice today from Newmont Mining Corporation (NYSE: NEM) ("Newmont") that it intends to make an offer to acquire all of the 8 7/8% Senior Notes currently not owned by Newmont, in addition to all of the gold hedge counter party contracts entered into between Yandal and counter party banks. "-END-

"The problem is not a small one for Morgan if Newmont walks. The hedge is 700,000 ounces more than their reserves and that's if someone is mining them. 700,000 times $370 gold is $259 million. At $470, it's $329 million. If the mine somehow becomes inoperable, the problem could become catastrophic. It serves Morgan right for allowing that kind of hedge in the first place. That's not a hedge, it's a speculation, put on back in the Hay Day of the gold rigging operations. What goes around comes around. Chase influenced Newmont to put on a big hedge at the bottom of the market around $265 gold, right before the Washington Agreement was announced. "The ramifications for the gold industry could be dramatic if Newmont sticks it to Morgan. Gold is only at the $370 level. What happens when gold rises hundreds of dollars per ounce? There is liable to be one counterparty risk problem after another. Ever hear this one before?

federal, Zeev, others...I have been racking my brains trying to think of a way to lock in the market value of my house to protect against a flogging in the real estate market. No insurance riders out there for that...the only thing I can think of is a reverse mortgage done near the top of the market. A 200K house now that was bought for 150K would pay you P&I back monthly out of the 50K equity. Do you or anyone know of a way to do this? Thanks.

5.125% 0 points on a 30 Yr conventional...geez..back in the refi line again. I'm 6% now. Yeah, this bond bubble will be bigger than the stock market bubble in 2000 I think.

George, watching 90.90 support as the intervention point for the USD index. If that let's go, it will be a watershed event IMO.

George, "Down or up from here we are not going to stay at $370 very long IMHO."
Yep, based on those COT numbers, it will be one hell of a squeeze or a flogging. I think the latter ST but beyond 400 oz by years end.

George, 320 has to hold or we will see 305-310 gold in a hurry. Agreed, gold stock action looked good yesterday.

All depends where that USD triangle breaks. In a downtrend, the odds are it breaks down. HUI showing higher lows here lately also favors USD to break down.

George,
How do you like gold here. Looks like it hit solid support. India and Pakistan heating up again. What do you think?

Chemical Ali dead...found by the British

redhot..http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18760250

Interesting read from the SDII thread.
The War to Save the Dollar
--------------------------
The Americans could live with Saddam until he started
selling oil for euros instead of U.S. dollars. Then the
Europeans could live with him.
* * *

GOOD AS GOLD

>From 1944 to 1971, the U.S. dollar was ``backed'' by gold,
meaning that the government agreed to buy and sell gold for
a fixed price in dollars. Other governments did likewise,
leading to fixed exchange rates between their currencies.
In 1971, when U.S. President Nixon abandoned gold backing,
the exchange rate system began to unravel. Domestically,
the U.S. dollar became a ``fiat'' currency, i.e. a currency
whose only ``backing'' is the legal obligation to accept
that currency as final payment of debts. Internationally,
however, there is no such thing as a fiat currency, and no
currency will be accepted as payment unless it is
guaranteed to buy some valuable commodity.

GOLD TURNS BLACK

In 1973, the Organization of Petroleum Exporting Countries
(OPEC) quadrupled the price of oil but continued to accept
only U.S. dollars in payment, so that the demand for
dollars soared. From then on, the dollar was effectively
backed by oil instead of gold -- and the U.S. government
didn't even have to own the oil!

Because dollars can buy OPEC oil, countries that need to
import oil -- i.e. most developed countries -- will accept
dollars as payment for their exports. Hence everyone who
needs to buy from those exporters will accept dollars as
payment for other things, and so on, so that the dollar is
the preferred global currency. To pay their bills,
importers must have reserves of dollars. To prop up their
currencies against speculative attacks, the central banks
of all countries must have reserves of dollars. To get
capital, poor countries must borrow dollars, and to service
these debts they must export goods to obtain more dollars.
About 2/3 of all currency reserves, more than 4/5 of all
currency transactions, more than half of the world's
exports, and all loans from the International Monetary Fund
(IMF) are denominated in dollars. As these things create
demand for the dollar and shore up its value, OPEC is the
more willing to accept payment in dollars. So the system
is self-reinforcing.

The result is that America can export dollars, which cost
nothing to produce, and receive real goods and services in
return. As long as those dollars are spent outside
America, they don't cause domestic inflation. And when
they eventually find their way into foreign reserves, they
can only be invested in American assets. This continuous
flow of foreign investment (on the ``capital account'')
props up the American real-estate market and stock market,
and allows America to run a mammoth trade deficit (on the
``current account'') without devaluing the dollar.
America's imports now exceed its exports by almost 50% (or
5% of GDP) and its foreign debt is 60% of annual GDP.

If OPEC were to abandon the dollar in favour of some other
currency, the whole process would slam into reverse.
America could no longer export paper dollars for real goods
and services. Corporations and central banks would sell
their dollar reserves, causing the value of the dollar to
plummet. The redemption of dollar reserves would force
sales of the assets in which those dollars are invested, so
that the American property and stock markets would crash.
Other investors who have bought American property and
stocks with borrowed money would declare themselves
bankrupt, causing some American banks to collapse under the
weight of bad debts. The newly liberated dollars could
only be spent on American goods and services, which would
begin to flow out of the country (reducing living
standards), while the glut of dollars chasing these same
goods and services would cause massive domestic inflation.
The flow of foreign investment would dry up, so that
America could no longer run a trade deficit, but would have
to export yet more goods and services to pay for its
imports, and to service its massive foreign debt, and to
accumulate reserves of the new global currency -- whatever
that currency might be...

EUROPE STRIKES BACK

In 1999, eleven member states of the European Union (EU)
adopted the euro as a common accounting currency. Greece
joined the Euro Zone a year later. On January 1, 2002, the
twelve countries withdrew their old money from circulation,
completing the biggest currency reform in history.

The Euro Zone already has a bigger share of world trade
than the USA. In particular, it imports more oil than the
USA and is the main trading partner of the Middle East. It
offers higher interest rates than the USA, but does not
have a huge foreign debt or trade deficit. These things
inspire confidence in the euro. It was perhaps for that
reason that in 2002, China started converting some of its
currency reserves from dollars to euros, while North Korea
abandoned the dollar and started using euros for trade.
The strength of the euro also encourages expansion of the
EU and puts pressure on current members Denmark, Sweden and
the U.K. to join the Euro Zone. In December 2002, ten new
countries were accepted for EU membership with effect from
May 2004. This will create a common market of 450 million
people, which will buy more than half of OPEC's oil.

In summary, the only argument for preferring dollars to
euros is that dollars can buy oil. As that argument does
not affect OPEC, it would make sense for OPEC to convert
its reserves to euros by mid 2004. If OPEC were then to
price its oil in euros, it would increase demand for the
euro, causing a huge increase in the value of its new euro
reserves. These possibilities are not discussed in the
U.S. media.

ROGUE STATES

The first OPEC member to show serious disloyalty to the
dollar was Iran. Since 1999, Iran has been talking about
pricing oil in euros. In January 2002, George W. Bush
named Iran in his ``axis of evil'' although the country is
experimenting with democracy -- something that the USA, if
true to its professed values, would want to reward and
encourage. Undeterred, Iran converted most of its currency
reserves to euros during 2002, and a proposal to price oil
in euros is being considered by the central bank and the
parliament.

Let us see whether the Americans find an excuse to topple
Iran's fledgling democracy and to replace it with a
dictatorship that just happens to prefer dollars to euros.

The second offender was Venezuela. In 2002, Venezuela's
twice elected president Hugo Chavez called a conference on
the future of fossil fuels and renewable energy. The
report of the conference, delivered by Chavez to the OPEC
summit in September 2000, recommended that OPEC set up a
high-tech electronic barter system, so that members could
trade oil for goods and services without the use of dollars
or any other currency. The chief beneficiaries would be
OPEC's poorer customers, who did not have large currency
reserves. Chavez made 13 such deals. In one of them, Cuba
provided health services in Venezuelan villages.

In April 2002 there was a coup against Chavez. The coup
was welcomed by the Bush administration and by editorials
in numerous American newspapers, but collapsed two days
later, leaving evidence that the U.S. administration was
behind it [1].

The third and most blatant offender was Iraq. In October
2000, Saddam announced that Iraqi oil would be sold for
euros instead of dollars, with effect from November 6.
Soon afterwards, Saddam converted Iraq's entire $10 billion
``oil for food'' reserve fund from dollars to euros. These
facts went unreported in the U.S. media.

George W. Bush assures us that Iraq's oil belongs to the
Iraqi people. But any asset priced in dollars is at least
partly an American asset because it adds to the demand for
dollars, allowing America to export more dollars and
receive more goods and services in return. So the test of
America's sincerity will be whether its new regime in Iraq
continues to accept euros for oil.

---

Dr Gavin R. Putland
Brisbane, Australia
March 26, 2003.

REFERENCES

[1] See http://www.fair.org/press-releases/venezuela-editorials.html ,
http://www.observer.co.uk/international/story/0,6903,688071,00.html .

For more information on the oil currency war, see
http://www.feasta.org/documents/papers/oil1.htm and the
links on that page. On the fortunes of the U.S. dollar,
see http://www.npq.org/archive/1987_fall/adventures.html .
For more reflections on the economic significance of
natural resources, see http://www.prosper.org.au and
http://www.earthsharing.org.au .

Not if your short. But good point.

What's funny is the SEC gets pissed when brokers manipulate stocks but when the PPT does it, it's OK. ROFLMAO!

11:25AM: MSNBC has reported that Saddam Hussein was wounded in last night's attack...US officials are also expressing "optimism" that some leaders may have been killed in that attack...that has prompted this spurt the past hour that brought the Dow almost back to unchanged before it dipped again...NYSE Adv/Dec 1027/1886, Nasdaq Adv/Dec 1031/1586

LT were fine but ST if support breaks on that trendline, were going to get whacked. Just looking for good entry points.

maine...too early. Wait until the dust settles.

HUI has to hold here at 128 to keep the ascending triangle intact on the dailies. http://stockcharts.com/def/servlet/SC.web?c=$HUI,uu[w,a]dacl...

George, I don't know about a huge rally. Maybe if we capitulate at the onset of the war...perhaps. Fundementals as well as technicals don't support a large rally IMO...just a bear market rally.

CT.."Does any one know if Soros has bought a large amount of Silver?"
He does own SIL I believe but I don't know about physical though.

girlfriend...I have the same problem with a couple of folks on that thread as well. They are a pretty uptight bunch over there but they are bright. I beat Egopatch to the ignore button. That dude is too much. Mish, if your reading this KUDOS! Nice post...I think a lot of folks were thinking the same thing but were afraid or unwilling to post.

Short-selling faces clampdown by SEC
By John Labate in New York
Published: February 19 2003 22:02 / Last Updated: February 19 2003 23:52


US securities regulators are considering sweeping changes to rules governing "short-selling", a controversial trading practice that has reached record levels during the bear market.


A clampdown could significantly alter the way many stocks are traded in the US and limit the profit potential of hedge funds and other active traders.

Regulators around the world are under pressure to tighten rules on short-selling, in which traders bet a stock price will fall, amid concern that it is used by professional traders to manipulate share prices, particularly of smaller companies.

Staff at the Securities and Exchange Commission, the chief US financial regulator, are expected to present proposals to William Donaldson, the new chairman, as early as next week. Among them could be rules forcing traders to borrow stock to cover their short positions. Under current rules, traders can take out "naked" short positions over an unlimited number of shares, putting huge downward pressure on an illiquid stock.

Regulators are less concerned about short-selling in the most liquid stocks and may even consider loosening the rules for large companies.

Officials also want a consistent set of rules across all US markets. For example, traders are forbidden from shorting a stock quoted on the New York Stock Exchange when the price is falling but Nasdaq stocks operate under a separate rule that does not apply to small stocks in the over-the-counter market.

US regulators say they are being pressed to clamp down on short-selling by politicians who complain the practice hurts companies. Allied Capital, MBIA and mortgage lender Farmer Mac are among those claiming their shares have been manipulated by short-sellers."The time has come to address what to do about short-selling but it is going to be political, controversial and complex," said a securities regulator.

Much will depend on the interest of Mr Donaldson, who was sworn into office on Tuesday. SEC officials pressed Harvey Pitt, his predecessor, to take up the issue but without success.

Short-selling is a trading technique in which one party typically borrows shares from another and then sells them into the market, betting that the price of the stock will fall in the near future when he must buy the same number of shares to repay the original loan. If the share price has fallen by that time, the short-seller has made money.

Any attempt to limit short-selling activities will be criticised by traders and some economists who argue that it should be less restricted because it makes for a more efficient and liquid market. "Short-selling should not be equated with manipulation," said one head trader in New York.

Market professionals argue that short-selling is an effective way to add legitimate negative sentiment to the market and keep wayward corporate management in line, but others say it is too often abused to corner small companies by controlling most or all of a company's publicly traded shares.

The SEC interest in short-selling is separate from a probe into hedge funds and would apply to all types of investors.

http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=104....

PriceWatch Alerts--HIGH RETURN COVERED CALL PRICEWATCH ALERTS - HIGH RETURN COVERED CALL OPTIONS
-- Royal Gold (Nasdaq: RGLD)
Last Price 25.25 - MAR 25 CALL OPTION@ $2.20 -> 8.5 % Return assigned*

Bob Chapman flees country? ROFLMAO!!!!!!
http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=31106

OT LOL!! Couldn't resist this one.
I cross ocean, poor and broke,
Take bus, see employment folk.

Nice man treat me good in there,
Say I need to see welfare.

Welfare say, "You come no more,
We send cash right to your door."

Welfare checks, they make you wealthy,
Medicaid it keep you healthy!

By and by, I got plenty money,
Thanks to you, American dummy.

Write to friends in motherland
Tell them 'come as fast as you can.'

They come in turbans and Ford trucks;
I buy big house with welfare bucks.

They come here, we live together,
More welfare checks, it gets better!

Fourteen families, they moving in,
But neighbor's patience wearing thin.

Finally, white guy moves away,
Now I buy his house, and then I say,

"Find more aliens for house to rent."
And in the yard I put a tent.

Send for family they just trash,
But they, too, draw the welfare cash!

Everything is very good,
And soon we own the neighborhood.

We have hobby -- it's called breeding,
Welfare pay for baby feeding.

Kids need dentist? Wife need pills?
We get free! We got no bills!

American crazy! He pay all year,
To keep welfare running here.

We think America darn good place!
Too darn good for the white man race.

If they no like us, they can scram,
Got lots of room in Pakistan.

Problem is it cost $25 or so to get certificates on physical delivery....probably a charge as well to turn them in when you sell them.

Oh, it's only the first 5 days that count right? LOL!

Teri G "Nothing like having a President open his mouth and everyone hits the sell button.."
Not as much as an intern with her mouth open and everyone hits the sell button...ROFLMAO!

EGO

George, eventually the miners have to play catchup to the PoG. A little media coverage might do the trick.

Same here. I even talked my dad out of his losing JNPR position and into WHT. He won't regret it...I had to scare the shi* out of him and explain the Kondratieff cycle, USD, Dow to gold ratio, etc etc etc. LOL!!

Could check the OI and volume on futures to back Kaplans statement up.

Itsallcyclical...Er um....could ya give WHT a swift kick in the ass for me? Grrr!! Too many nervous nellies over the financing.

PoG 364.30. Expect the miners to gap up tomorrow...they are lagging the GOX and HUI big time. It's catch up time.

PoG 362.80

George, for gold it seems like 372-380 or bust. I'm gone at 372.

SLGLF..SLAM SLAM! Article...
Canada's Silverado:
hottest gold stock?
Some experts alarmed over PR hype, contradictions, skyrocketing values
--------------------------------------------------------------------------------
Posted: January 21, 2003
5:00 p.m. Eastern

By Sherrie Gossett
© 2003 WorldNetDaily.com

With its stock rocketing up over 750 percent in a year, Silverado Gold Mines stands out in a market plagued by continued corporate financial scandals and stock market volatility. With gold recently nearing a six-year high and investors looking for a solid buy, gold is becoming an ever more attractive option. Add to this the company's announcement that David Tice of the Prudent Bear Fund is an investor, and there's a definite buzz surrounding Silverado -- a buzz WorldNetDaily decided deserved a closer look.

Silverado Gold Mines Ltd. (OTCBB: SLGLF) is a 1964-chartered company which became SEC reporting in 1978, under SEC regulations that require companies that have 50 percent or more of their shareholders or properties in the U.S., to report. The company, through its wholly owned subsidiary, Silverado Green Fuel Inc., has owned and operated various gold properties in Alaska. In addition, Silverado Green Fuel Inc. is involved in creating what the company describes as "the world's first low-cost, environmentally friendly fuel made from coal as a replacement to heavy oil."

Silverado also began trading July 26, 2002, on the Berlin stock exchange with the ticker symbol "SLG" and the German security number (WKN) 867737. Currently the company's gold-mining activities are focused on its Nolan mine, the company's only mine in operation.

The Nolan Gold Project consists of five contiguous properties covering approximately six square miles, eight miles west of Wiseman, and 175 miles north of Fairbanks, Alaska, in the foothills of the Brooks Range, in an area known as the Koyukuk Mining District.

Nolan Mine

The company says it expects to yield $19.7 million in net revenues over the next three years from the Nolan Mine. "We anticipate generating $7.5 million in revenues net to the company in this year alone," CEO Garry Anselmo announced in November.

Silverado's predictions are intriguing, considering that the company's most recent 10Q filing (a quarterly report required by the Securities and Exchange Commission) shows $997 in gold sales for the nine months ended Aug. 31, 2002, and gold inventory at $10,169. For the same period the previous year, gold sales were at $1,786 and gold inventory at $11,140.

One stock analyst, who declined to be named, raised doubt over Silverado's November 2002 prediction of $7.5 million in gold sales "this year." SEC filings indicate processing of gold taken from the Nolan mines won't commence until spring of 2003, and gold sales commence in summer of 2003. Silverado's Anselmo explained to WND that the term "this year" really refers to a one-year period beginning November 2002.

According to SEC filings, The Company's total proven and probable gold reserves (in Troy ounces) from all its Alaskan properties are as follows: proven-111,298 ounces; probable-329,616 ounces.

However only the Nolan mine is currently in operation. The Nolan mine lists 11,802 ounces in proven reserves, and 48,262 in probable reserves, for just over 60,000 ounces in both proven and probable reserves combined.

However, in paid "advertorials," including one which appeared in the Bull & Bear Financial Report, the company stated, "Although the Nolan mine has proven and probable reserves of 141,000 oz./au, additional potential reserves have been identified and await drill analysis. … In addition the company has indicated reserves totaling one million oz./au."

Even though Nolan is the company's only operational mine, the advertorial went on to state: "The Ester Dome, Eagle Creek and Marshall Dome properties contain about 900,000 ounces of gold valued at about $300 million," concluding, "Silverado is targeting global gold purchasers in this rising market."

However, the company's most recent 10-KSB filed with the SEC on March 15, 2002, indicates that the company has "no planned activity" on the Ester Dome Project (which includes the mentioned Eagle Creek and Marshall Dome properties), "except for maintenance." Both Marshall Dome and Eagle Creek are listed as "undeveloped" and do not "contain any open-pit or underground mines." In addition, "There is no mining plant or equipment" located on either property. And "currently" there is "no power supply" to either Eagle Creek or Marshall Dome.

The SEC report states, "No reserves are included at this time for the Eagle Creek property," adding it "does not have any proven mineral reserves."

The Grant Mine's mill and equipment, also part of the Ester Dome Project, are listed in "operating condition, but are not currently operating." The Ester Dome has proven reserves of 99,496 ounces, and probable reserves of 286,354 ounces of gold, but the company adds it is "minimizing work on this property to maintenance," in order to concentrate on Nolan.

In addition, the company's most recent 10Q states: "The Company also plans to option to third parties the Ester Dome and Marshall Dome properties."

The advertorial also mentioned the Smith Creek property (part of the Nolan Gold project), referring to "advanced exploration and development." But according the company's latest 10KSB filing: "Currently, the Company has no mining activity on the Smith Creek except for its required Federal mining claims payments."

In a paid advertorial appearing in the Nov. 2, 2002. edition of the Bull & Bear Financial Report, the company said it is basing its revenue projections on "assay results from previous drilling programs," adding: "However there is a good chance revenues could be even higher."

In a taped interview, WorldNetDaily asked CEO Anselmo whether Silverado performs its own assaying. "Oh no, we use an independent lab," Anselmo told WND, "typically ChemEx lab, and so all our assays go outside."

Silverado CEO Garry Anselmo

He then added: "Now at Nolan, [laughter] gold is an assay problem. Assays are based on representative samples. Sampling with gold is very difficult." Anselmo stated that a sample from a placer mine "could not be representative, you would not have accurate data," adding, "so in this case we've done our own work." The CEO also made reference to "other engineers" on the project, and "reports we've had written that have verified these findings," concluding, "That's what we fall back on for our reserves at Nolan."

The company's annual report filed on March 15, 2002, states: "The proven and probable reserve calculations for the Company's mineral properties were determined by Mr. Edward J. Armstrong, Certified Professional Geologist. Mr. Armstrong is president of the Company's subsidiary, Silverado Green Fuel Inc."

Armstrong is also president of Tri-Con Mining Inc. and Tri-Con Mining (Alaska) Inc. Tri-Con is a privately owned corporation controlled by Anselmo -- president, chairman, CEO and a director of Silverado.

(The Tri-Con Group comprises operations, exploration and development contractors that have been employed by Silverado under contract since 1972 to carry out all its fieldwork and to provide administrative and management services.)

Silverado's most recent 10Q filing states: "The Company is in arrears of required mineral claims and option payments for certain of its mineral properties at August 31, 2002, in the amount of $285,500 and therefore, the Company's rights to these properties with a carrying value of $315,000 may be adversely affected as a result of these non-payments."

A 'revolutionary new fuel'

Silverado is also strongly touting its "revolutionary new fuel process." The company entered the fuel sector in 2000, forming a New Fuel Technology Division," which operates out of Fairbanks, Alaska. Silverado has stated that it is the "top contender" for and "close to winning" a $9.7 million Department of Energy grant to demonstrate the commercial feasibility of the fuel.

In addition, the company's promotional materials have claimed variously that Silverado "controls this technology," that the process is "patented," and that Dr. Warrack Willson, who is now vice-president of Silverado's Fuel Technology division, "holds the proprietary rights to the low-rank coal water fuel (LRCWF) process."

Ron Pierce, director of the University of Alaska's Clean Coal Project, a project also tasked with demonstrating the commercial feasibility of low-rank coal water fuel, scoffed at the idea that making the fuel was a "proprietary process."

Low-rank coal water fuel (LRCWF) is essentially a slurry of water and coal particles that can serve as a non-hazardous replacement for oil. And experts say the fuel is not "new"; there are two decades of research and symposia on record related to LRCWF, and research on low-rank fuels and coal-water fuels in general stretches back to the 1960s.

While experts say the process of making the fuel itself is not patented, there are patents in existence for enhancing certain characteristics of the fuel. A May 5, 2000 Silverado press release stated that Dr. W. Willson "co-holds a U.S. Patent (No. 4,337,142)" for the "Continuous Process for Conversion of Coal." While Willson is listed as one of five inventors of the patent, the document lists the assignee (the party that actually holds the patent and attendant rights) as "The United States of America as represented by the United States," adding that the invention arose out of work performed while under contract to the U.S. Department of Energy.

Willson is also listed as one of seven inventors for a patent described as "Methods to enhance the characteristics of hydro-thermally prepared slurry fuels." The assignee for that patent is the Energy & Environmental Research Center in Grand Forks, N.D. That work was funded in part by four Department of Energy cooperative agreements, and as such the patent states, "The U.S. Government may have certain rights in the invention."

Dr. Michael Jones, of the EERC, told WND that Silverado had not applied for nor inquired about a license for use of the patent. Jones is associate director of industrial relations and technology commercialization at the EERC, and adjunct assistant professor of physics at the University of North Dakota.

WND asked Anselmo about seeming discrepancies in the company's claims of controlling patents and of holding "proprietary rights" to the production of LRCWF, as compared to statements from government documents and scientific experts.

Anselmo answered: "He [Dr. Willson] has certain proprietary rights necessary to run the process." When asked, "And what rights are those?" the CEO replied, "The rights we do not put forth. He's published, uh, people can look at those, um, they're all published … we're not going to point people where to go."

What about Silverado's claims, in its promotional materials, that it is "close to winning" a $9.7 million DOE grant? The company applied for the federal funding under the Clean Coal Power Initiative, a program that is actually a co-operative agreement requiring cost-sharing and re-payment.

The Department of Energy has been reviewing these proposals now and announced the selections as this report was going to press.

Silverado was not awarded federal funding. The company's explanation for being turned down was that the $313 million in federal funding "went to major polluters to clean up."

Silverado's 'partners'?

Silverado's application for federal funding listed as "partners" Great Northern Engineering in Anchorage, Alaska, and The Mineral Industry Research Laboratory at the University of Alaska, Fairbanks.

However, an employee of Great Northern Engineering, who declined to be named, denied to WND that there was any partnership between the companies, stating GNE has simply performed contractual work for the company on occasion. Messages left for GNE owner John Riggs were not returned.

Likewise, Dr. Sukumar Bandopadhyay, director of the Mineral Industry Research Lab at the University of Alaska, stated that there was "not yet" a partnership between Silverado and the lab.

Ron Pierce, director of the University of Alaska's "Clean Coal Project" also denied there was any connection between the university and Silverado. Pierce coordinates the construction and management of the project and assists in obtaining funds for future construction activities.

The UAF Clean Coal Demonstration Project was sponsored by the U.S. Department of Energy. Theproject called for the assembly of a proving facility for the commercial demonstration of low-rank coal water fuel (LRCWF) production and utilization technology. The project involves construction of a LRCWF processing facility and installation of a 6.4MW (9.6MW on oil) 18-cylinder diesel engine that will burn LRCWF. A 6,000-hour demonstration period is planned to show the performance and economics of the technology in both reciprocating engine and boiler applications. After a valiant effort and over $48 million in funding, the project is currently stalled and awaiting further funding.

As indicated in its federal funding application, Silverado estimated the total cost of its project to be only $23,961,760, the estimated Department of Energy share to be $9,718,366 and Silverado's estimated share to be $14,243,394. Prior to the recent announcement, WND asked Joann Zysk, an Acquisition and Assistance Division contract specialist with the National Energy Technology Laboratory, whether Silverado was indeed a "top contender" for the federal funding, as its public statements have indicated. Zysk said that she had already been made aware of the information and added, "What they're [Silverado] putting out there is very misleading."

Asked to comment on the "partners" that denied the relationship Silverado claimed, Anselmo told WND: "They'll deny it. They'll deny being part of it, they've turned us down on a number of occasions."

Asked why would they want to deny it, Anselmo answered, "Oh, the politics have been unbelievable," citing "a lot of jealousies" and stating that "the administration [of the University if Alaska] have [sic] been working with us," adding that "one of our directors in fact on board of university [is] … Ed Armstrong."

Anselmo added, "Be careful how you cast things, we're almost there, let the grant fall. … The University will be good buddies and be wanting to join us."

Anselmo later called WND to retract the comment identifying Armstrong as a university board member.

Prior to publication of this report, Anselmo called WND and said, regarding the patent information: "I asked you not to go into this," and warned this reporter repeatedly to "be careful," adding that the project was "a big political machine," adding "you don't want to be posting that information," and to "let this [the awarding of $9.7 million in federal funding] happen."

In vague, rambling comments, he tried to persuade WND to not divulge its findings regarding the patent issue, because "they [the EERC] applied for the patent under fraudulent data." In response, Dr. Michael Jones of the EERC told WND, "We stand by our patent."

Silverado's most recent 10Q and its last Annual Report make no mention of a "revolutionary new" fuel, or of "control" over a technology, or of "proprietary rights" to the LRCWF process.

Described in advertorials as "highly evolved," the company's LRCWF project is depicted in SEC filings as "in its initial stages," "still in the start-up phase" and "not a reportable segment."

However, some of the company's heaviest spending has been on "research and development" targeted towards the development of the fuel process.

SEC filings indicate research activities attributable to the company's low-rank coal water fuel technology were at $202,034 for the nine months ended Aug. 31, 2002, and $209,656 for the nine months ended Aug. 31, 2001.

Tri-Con's role

While SEC filings also indicate that Silverado has no employees, and Anselmo told WND that he does not take a salary from Silverado, these relatively high research and development costs for the "unreportable segment" are billed through Tri-Con Mining, Ltd., a private company controlled by Anselmo.

Under the current contract dated January 1997, work is charged at cost plus 15 percent for operations and cost plus 25 percent for exploration and development. Cost includes a 15 percent charge for office overhead, even though Tri-Con uses Silverado's offices.

Silverado has significant office overhead. The most recent 10Q puts office expenses at $141,193.

In addition, "management services from related party" were at $147,055, and "general exploration" was at $82,184. The SEC filing also states, "At August 31, 2002, the Company had advanced $776,521 to the Tri-Con Mining Group for exploration, development and administration services to be performed during the current fiscal year on behalf of the Company."

Stock promotion

Another area of financial focus for the company is paid advertorials and promotion programs. Even in periods of low gold sales, Silverado consistently has shown to spend tens of thousands of dollars in promotional advertorials - as much as $45,000 per newsletter campaign. Per the company's latest 10Q filing, Silverado spent $118,700 on advertising and promotions, and had revenue from gold sales of $971. For the same period, the company spent $1,019,168 in "consulting fees."

Advertorials have appeared in such stock promotional venues as Diablo Alert, Penny Picks, Wall Street Universe, the Bull & Bear Financial Report, CEOCast, Equity Alert, Emerging Company Report and International Economist J. Wesley Savage and his Princeton Research, Inc. group. Positive "press" from the latter on behalf of Silverado appeared in March 1997" and May 1997.

No indication is given as to whether Savage received compensation for his reports. Two of those stock-touting companies used by Silverado -- Emerging Company Report and Princeton Research -- were named in the SEC's first Internet securities fraud sweep in 1998.

One unpaid stock report, Stock Patrol, noted: "If Silverado is paying these various online promoters, investors may question its allocation of resources. … After all, despite a thirty year operating history, Silverado's mining operations are not profitable, its liquid assets are meager, and its revenues are sparse. Could available funds be put to more productive use - like building the fuel production facility?"

Bob Chapman and David Tice

Silverado has also had a strong supporter in the person of Bob Chapman, a high-profile gold "analyst" who puts out the International Forecaster newsletter. CEO Anselmo told WND that Chapman is a highly trusted figure in gold circles, adding that "the old folks just dote on him, and trust his every word."

Chapman told WND, "Silverado is one of the best junior exploration stocks in North America today. We recommended the stock at $0.08 and it has traded as high as $0.76." Silverado has been featured in some of Chapman's newsletters.

Bob Chapman

A Silverado advertorial lists Chapman as an "analyst."

SEC filings indicate that on Oct. 15, 2001, Chapman entered into a "consulting agreement" with Silverado.

The agreement was for a duration of eight months, and included the issuing of 675,000 common shares of the company to Chapman on Jan. 15, 2002, and 225,000 common shares of the company on the fifteenth day of each month of the term of the agreement thereafter, commencing Feb. 15, 2002, for an aggregate maximum of 1,800,000 shares.

WND asked Anselmo what type of consulting services Chapman provided, and if that included promoting that company. "No, not for promotions," said Anselmo. "It was introductions to groups in Europe, it's, um, uh, people who can assist Silverado. In um, the coal, low-rank coal water fuel industry, opportunities in other countries, uh, it was introductions to people here in North America, including David Tice, and he [Bob Chapman] writes us up in his reports to his very large e-mail list, and uh, supports Silverado's efforts."

Indeed Tice's name has appeared in Silverado advertorials with tantalizing phrases such as, "What does a savvy investor like David Tice see in Silverado?" Anselmo maintains that Chapman and Tice are close, and that Tice respects Chapman's advice. According to the CEO, Chapman was instrumental in steering Tice towards Silverado: "Chapman told him to get off his ass and get after Silverado," Anselmo said.

He added, "They [Prudent Bear Fund] bought private placement for treasury stocks and they buy in the open market and he has warrants in the company that he'll exercise at some point."

But Anselmo also admits that Tice did not want his investment to be touted publicly, adding "I don't know what he's waiting for."

Tice's Prudent Bear Fund was recently called the "No. 1 mutual fund in the country," by Fox News channel's Neil Cavuto. For the 6 months ended Sept. 30, 2002, the Prudent Bear Fund returned 58.89 percent while the S&P 500 lost 28.36 percent and the NASDAQ lost 36.49 percent. Consistent with their investment philosophy, the fund holds more short positions than long, and Tice is long on gold.

Tice also has a sterling reputation for sounding warnings on over-inflated stocks, and is known for his scathing research reports.

Early on in its investigation of Silverado, WND called the Prudent Bear fund and asked representative Rob Peebles to comment on Silverado's use of Tice's name, indicating that WND had found seeming contradictions in communications about Silverado.

Promising to call WND back shortly, Prudent Bear officials instead contacted Silverado, and within minutes WND received a phone call from CEO Anselmo, calling from a hotel in San Francisco: "I'm very upset," he said. "I understand WND is doing a hatchet job on Silverado."

A month later, a further call to Peebles was made, during which he stated that Prudent Bear does not comment on individual companies, and that David Tice had contacted Anselmo after the initial inquiry by WND. Peebles forwarded Tice's e-mail and indicated Tice would now be able to answer WND questions. WND never received a response from Tice regarding Silverado, or its use of his name to promote Silverado stock.

WND did obtain, however, an e-mail exchange between a professional stock trader and Peebles, asking him to comment on the same issue, and enumerating alleged misrepresentations made by Silverado of its business within advertorials mentioning Tice's name. Peebles responded, "As you can imagine, David did not authorize such marketing materials and has spoken to the firm about it."

Prudent Bear's Annual Report indicates the company purchased 1 million shares of Silverado stock and 1 million options.

'Cirque du Anselmo'?

While Silverado rides high on its stock upswing and garners increasing attention from the use of such names as Bob Chapman and David Tice, some professional stock traders and businessmen are crying "foul" and accusing the company of being a "pump and dump" scheme. One referred to it as "Cirque du Anselmo."

"Pump and dump" is a practice by which a large group of people buy into a low-priced stock and start touting the equity. This is most frequently done on the Internet. Then when others buy in at an inflated price, the group sells and makes a profit while the investor is left holding a large loss.

WND has also obtained complaints filed with the SEC and addressed to Emily Breckinridge, Kara Axel and Jessica Ridgley of the Pacific Regional office of the SEC. The complaints allege fraudulent business practices on the part of Silverado, and complain of SEC laxity in failing to intervene.

Are the complaints legitimate concerns or just the disgruntled efforts of opportunistic short-sellers? WND attempted to contact Breckinridge, but was referred instead to the assistant regional director for the SEC's Pacific Regional Office, Kelly Bowers.

Bowers would not comment on the complaints, and was not able to answer the simplest questions without extensively leafing through an SEC manual in search of an answer. Bowers finally suggested WND look through the manual itself.

WorldNetDaily asked Miami attorney Gary Goodenow Sr. to comment on the issue. Without divulging the company name, or any persons or entities connected to Silverado, WND gave Goodenow public statements made by the company as well as pertinent SEC filing information. Goodenow is licensed to practice in the State of Florida and the District of Columbia, and has served in large law firms, his own firm and the Securities and Exchange Commission.

During his tenure at the SEC,. Goodenow served as staff attorney, branch chief, senior trial counsel and senior counsel. In the latter capacity, Goodenow made the final recommendations on which cases the office would investigate and prosecute and which it would decline. He has variously investigated and prosecuted cases for the SEC, supervised the work of five or six SEC staff attorneys, and was responsible for litigating about 30 enforcement cases at any one time in federal court.

Gary Goodenow Sr., former SEC prosecutor

Goodenow also participated as an author and panelist at the Fourteenth Annual Conference on Money Laundering, Cyber Crime and International Financial Crimes and writes extensively on systemic problems at the SEC. His most recent op-ed, "SEC Chairman Must Go," appeared in the Miami Herald.

Regarding the use of a famous person's name (David Tice), Goodenow said: "Regretfully, I report that the best thing a person or group behind a pump and dump could hope for is to have an important personality invest." He explained: "Sales of the stock of such a venture will be presented to the investing public as having the imprimatur of a person who it seems would have the resources to learn the legitimacy of the investment."

Goodenow compared the situation WND presented to him with the Premium Sales case he brought while at the SEC. "The fraud-doers took in about $425 million, and the investors, because of rollovers of their 'profits,' thought they were out around a billion dollars." He added: "What was critical to the fraud was that baseball great Joe DiMaggio had invested $100,000. If it was honest enough for the 'Yankee Clipper,' it was seemingly honest enough for other investors."

Goodenow's advice? "I caution my clients never to buy on hype of who is in a stock," he said, "unless -- and this is a big 'unless' -- the personality has gone on record endorsing the investment."

He further cautioned, "By 'on the record,' I do not mean salespersons' statements or PR copy that he or she has invested. I mean endorsements to third-party members of the investment community or to journalists who cover investments. Any investment conduct to the contrary is fraught with hazard. Anyone who tells you that it's not risky is either an idiot or a liar."

Regarding Silverado's meteoric rise, Goodenow said he would be "very, very, very leery of a stock that has risen 750 percent in a year. … My reaction is one of complete skepticism, and this view is exacerbated by your reporting if the hype that a significant investor has a position and that upon your inquiry, it appears that they company and the putative investor 'circled the wagons' to borrow a phrase from movie westerns." He added, "I think it is reasonable for me to say that any journalist on to a pump and dump, would likely be called a person performing a 'hatchet job.'"

In his last year at the SEC, Goodenow was in charge of the "New Matter Committee," responsible for the intake of all complaints, tips, news articles and the like. "Based on that," he said, "if I got a report of a OTC:BB stock, up 750 percent, with the matter unsettled factually as to how or if a major personality was involved, and I had a journalist stating that the reaction to his or her inquiries was for the company to consider the questions to be a 'hatchet job,' I would think. And again, I note that you've given me no proper nouns -- I think in that circumstance I would have strongly recommended that the New Matter Committee order an investigation forthwith."

Goodenow told WND, "What can I say? It seems to me that you have found the contradictions that are all 'red flags.'"

Specifically, Goodenow emphasized:

"The claim of $7.5 million in projected gold sales this year 'raises my eyebrows.'"

"The 'partners' issue may stem from the situation where there may be no legal definition of 'partner' in the state law that governs any such partnership agreement -- but we likely will not know 'choice of law provision' of such an agreement because you have learned there is no agreement -- very strange."

"The ounces of gold involved would be questioned by the SEC to learn the factual basis of the claims. No basis, then the fraud provisions kick in."

"The SEC would not likely countenance an expert opinion, like that required to make an assay report, made by 'insiders' as such people seem to me to be from your description."

"The whole 'fuel technology' [LRCWF] that's 'decades old,' yet without a 'single drop,' for me just reeks of fraud."
Goodenow sought also to shed light on the Vancouver Stock Exchange (VSE). "The VSE has a very, very bad reputation among the enforcement attorneys at the SEC. It got that reputation from investigations years prior to my SEC service, which showed, or suggested, that he VSE was used to launder money that organized crime skimmed off the Las Vegas casinos." He added, "Whether that reputation is presently deserved or not, I do not know. But I do know that I do not presently own any stocks traded on the VSE."

Adding further words of caution, Goodenow said: "Pump and dumps are often used for money laundering. And the people who need their money laundered do not accept failure very well. They express their disappointment at failure with guns. I keep thinking of that Goldcor case, also a pump and dump, also with gold … and a person was murdered."

Goodenow was referring to Richard D. Brown, 51, who was found shot dead at his home in Daytona Beach, Fla., on the morning of Saturday, Aug. 17, 1991. He had been shot once behind his left ear, execution-style. His murder is still unsolved.

Brown had been due to appear in court three days later, on Aug. 20, in connection with a 21-count criminal indictment against him for his involvement in Goldcor, a mysterious securities scam that netted up to $100 million.

In the Goldcor case, it's been estimated as many as 3,000 investors could have lost between $75 million and $100 million investing in the scam. Many of the investors were Christians who trusted Goldcor because of Brown's "religious" background. Brown was the founder of the International Christian Life Ministries, described as an evangelical outreach ministry based in Daytona Beach.

Goodenow warns that "there's very little the SEC can or will do to prevent the losses" incurred by duped investors.

Meanwhile, Silverado's CEO, Garry Anselmo, considers any suggestion that his company is a "pump and dump" to be "bulls--t." He added, "Sure we promote it, but there is no 'dump.'" Claiming support from U.S. senator and now Alaska's Republican governor, Frank Murkowski, as well as others, based on supportive letters written by the politicians about Silverado, Anselmo is confident that the momentum behind Silverado will continue and that the next three years will bring about a bonanza in gold sales.

In the meantime, investors might want to review those financial statements, even if the politicians don't have the time.

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Sherrie Gossett is a Florida-based researcher and writer, formerly with the South Florida Sun-Sentinel, and a contributing reporter to WorldNetDaily.

http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=30603

Nice post...thanks.