House of Cards - Aug. 12th news...

* Gold near 8-mo. high, eyes on dlr, $66 oil -Reuters
* Inflation a concern for Fed -NY Newsday
* Crude touches new record atop $63 -MW
* 100,000 gold miners on strike in South Africa -MSN
* Gold-price manipulation theorists meet in Dawson -CBC
* Gold Investing May Come To Seven-Eleven Stores In Japan -DJ
* Economists warn against Fed's policy -BL
* Dollar falls on outlook for structural deficits -FT

* ONE NATION UNDER ($8 Tril) DEBT - Craig R. Smith
* THE NEW GOLD RUSH: PHASE II -SATC Special Alert
* Drowning in Debt? -Paul J. Lim, USN&WR
* Study: Moral values top $$ legacy -Terry Savage
* Iran has nukes now -Dr. Jerome Corsi, WND
* Rewarding Terror -Rachel Ehrenfeld and Paul E. Vallely
* Renowned Fund Mgr Predicts Economic Collapse -Al Martin

"In France I had almost always seen the spirit of religion and the spirit of freedom marching in opposite directions. But in America I found they were intimately united and that they reigned in common over the same country.... Religion in America...must be regarded as the foremost of the political institutions of that country; for if it does not impart a taste for freedom, it facilitates the use of it... There is no country in the whole world where the Christian religion retains a greater influence over the souls of men than in America, and there can be no greater proof of its utility...than that its influence is powerfully felt over the most enlightened and free nation of the earth."

-ALEXIS DE TOCQUEVILLE, "Democracy in America"

MARKET NEWS DIGEST

Gold near 8-mo. high, eyes on dlr, $66 oil -Reuters
Weak dollar, record oil lift demand
Aug. 12, 2005

NEW YORK, Aug 12 (Reuters) - U.S. gold futures opened at their highest level in eight months on Friday before backing down a bit, as dollar weakness and record crude prices attracted investors to alternatives like the precious metals.

A 6.1 percent rise in the U.S. trade deficit in June after COMEX gold opened prompted a flash of buying in gold as the dollar briefly eased, but a lack of follow-through and some long liquidation then pushed the metal futures lower.

Prices were gyrating as currency values fluctuated wildly over the last day and the trade data and $66 crude oil largely have been fueling the heavy turnover in the yellow metal.

"This is just profit-taking and a lack of bids," a desk trader at an international bank in New York said. "We went up really quickly and a little correction is necessary."

By 9:42 a.m. EDT, gold for December delivery on the New York Mercantile Exchange was up $1.40 at $452.30 an ounce, patrolling a range of $449.10 to $455.30.

The day's high, hit during overnight NYMEX ACCESS electronic trading, was the priciest for futures on a spot continuation basis since December 2004, when the active contract neared $460.

The U.S. trade gap widened to $58.82 billion in June, from $55.43 billion previously, and above forecasts for a rise to $57.3 billion. Stronger oil prices that month boosted imports and a firm dollar hurt demand for U.S. exports.

As the dollar recovered on short covering, the euro last was down at $1.2417, below an earlier 2-1/2-month high at $1.2496. A firm dollar tends to weigh on gold because the U.S. currency-priced metal gets cheaper for non-U.S. buyers.

U.S. light crude surged to its highest on record at $66.16 a barrel on Friday amid robust global demand and declining U.S. gasoline stocks.

Gold often benefits from rising oil prices as the prospect of inflation prompts some investors use gold as a hedge.

"Gold traders will continue to monitor the funds with oil and the dollar continuing to lend direction," said analyst James Moore at TheBullionDesk.com.

Moore said that a test of last December's 16-year high in spot gold at $456.75 looked "quite likely" in the coming week, though the market technically was overbought and probably primed for some consolidation at this point.

http://www.reuters.com

Related Special Alert:
Swiss America Special Alert 21st Century Gold Rush, Phase II ... "Some of the sharpest minds on Wall Street are betting that you'll make more money in metals than Microsoft the next few years. The new bull market is in stuff, not stocks." -USA TODAY ... Starting in 2001, gold, silver and rare U.S. coins began a long-term or "secular" bull market. Since then, tangible "stuff", like real estate, commodities and collectibles, is where big money has been moving.

Inflation a concern for Fed -NewsDay
Productivity growth slows; Federal Reserve raises short-term rate by a quarter point and another hike is forecast
BY RANDI F. MARSHALL, NY Newsday STAFF WRITER
August 10, 2005

Productivity growth slowed and labor costs rose in the second quarter, creating a recipe for higher inflation to come.

And in an attempt to balance the combination of a stronger economy, the potential for higher prices and already high energy costs, the Federal Reserve yesterday raised the short-term federal funds interest rate for the 10th straight time in 14 months, by a quarter point. The Fed also left little doubt that the increases will continue.

Productivity, a measure of how much employees produce in an hour of work, increased at a 2.2 percent annual rate in the second quarter, the slowest pace in nine months, according to a Labor Department report yesterday. Unit labor costs, meanwhile, rose 4.3 percent in the 12 months ending in June - the largest gain since 2000. That's worrisome to some experts because companies with higher costs and lower production will, in all likelihood, eventually raise their prices.

"As labor markets improve, you are going to see some cost pressures," said Anthony Chan, chief economist with JPMorgan Asset Management in Columbus, Ohio. "I think the Fed is going to be forced to be a little more vigilant in what's going on on the pricing front."

Of course, gains in labor costs bode well for employees because they indicate compensation increases. However, there's other evidence that those gains come mostly from increases in health care and pension benefits, and from bonuses or stock options.

"Unfortunately, that's not the type of compensation that favors Main Street," Chan added.

Additionally, real hourly compensation - which takes inflation into account - fell at a 0.6 percent annual rate in the second quarter, the Labor Department reported.

FULL STORY

Related Offer:
"INFLATION SOLUTION": Taking back control of your financial future ... Today everyone from Paul Harvey... to Alan Greenspan... to WSJ is worried about rising inflation. Wouldn't it be a sin if inflation was really TWICE as high as reported? ... "Real World" Inflation 7% ... and rising!

Crude touches new record atop $63 -MW
By Myra P. Saefong, MarketWatch
Aug. 8, 2005

SAN FRANCISCO (MarketWatch) - The benchmark contract for crude-oil futures climbed above $63 a barrel Monday for the first time ever as the closure of a U.S. embassy in Saudi Arabia sparked concerns that more trouble may be brewing in the oil-rich Middle East.

Crude for September delivery traded as high as $63.60 a barrel on the New York Mercantile Exchange. It was last at $63.50, up $1.19.

On Sunday, the U.S. embassy in Riyadh said it was closing until Wednesday amid an unspecified security threat. See full story.

The gains in oil are "tied to a 'heightened state of alert' as opposed to an actual supply shortage," said Tim Evans, a senior analyst at IFR Markets.

"This gives the markets an opportunity to blast to new highs in the near term, although the ongoing flow of ample production means that a major downside risk for this market remains," he said in a note to clients.

At the same time, "Iran's resumption fo nuclear fuel conversion" added to the strength in oil, said John Kilduff, an analyst at Fimat USA.

"The situation surrounding Iran bears close watching," he said in a research note, adding that "Iran's rejection of the latest incentives offered by the EU to cease its nuclear program was expected in most quarters."

Crude-oil futures climbed Friday and logged a weekly gain of about 3% as refinery output problems, five weeks of falling U.S. gasoline inventories and strong economic data fed concerns that demand will outstrip supplies.

http://www.marketwatch.com

100,000 gold miners on strike in South Africa -MSN
Mon, 08 Aug 2005
CBC News

One hundred thousand gold miners in South Africa were off the job in a national strike on Monday, and the country was bracing for the possibility of more labour action this week.

The miners began their walkout on Sunday evening in a dispute over wages and living conditions.

The strike is already having a huge impact on the country's gold mining industry. Analysts told the British Broadcasting Corporation losses from the strike were expected to be about $12 million US a day.

South Africa is the world's biggest producer of gold bullion. It accounts for 15 per cent of all gold output.

The National Union of Mineworkers is seeking a pay raise of 12 per cent. Management has offered increases of five to six per cent.

The mine workers last went on strike in 1987.

One major difference this time is the unity among black and white workers in the push to earn more money.

FULL STORY

Gold Investing May Come To Seven-Eleven Stores In Japan -DJ
By Jim Hawe, DOW JONES NEWSWIRES
Monday August 8, 2005

TOKYO (Dow Jones)--Gold investing in Japan may soon be as easy as picking up a pack of smokes at the neighborhood convenience store.

Bringing a whole new level of convenience to gold investing, trading giant Mitsui & Co. (8031.TO) plans to offer its "gold accumulation plan" through select IY Bank outlets in Ito-Yokado Co. (8264.TO) supermarkets, with a possible move to Seven-Eleven convenience stores in the future.

"We are happy to have this opportunity to offer this product through our broad alliance with IY Bank," said Eiki Okada, a Mitsui spokesman.

Gold accumulation plans, or GAPs, have become popular in Japan in recent years and are now offered by several firms, including Sumitomo Metal Industries Ltd. (5405.TO) and Mitsubishi Materials (5711.TO).

Under these plans, a fixed amount is automatically withdrawn from a member's bank account each month and invested in gold. Investors are able to avoid the premiums usually charged for gold bars and coins. Also, by investing small amounts over a long period of time, they can avoid the risk of investing a large amount at the wrong time.

These plans are attractive to individual investors, as the minimum monthly requirement is usually only Y3,000.

IY Bank currently operates more than 10,000 automated teller machines nationwide, mainly at convenience stores run by Seven-Eleven Japan Co. (8183.TO), which is also a unit of Ito-Yokado.

Okada said the aim is to capture a new breed of gold investor.

"So, for example, a woman in some remote area out buying her milk and eggs will be able to purchase gold. This gives her the same opportunities as an institutional investor in the big city," he said.

Itsuo Toshima, Japan-Korea regional director for the World Gold Council, an industry lobby, said this move is part of the broader efforts by the gold industry here to position GAPs as an entry product for first-time gold investors.

"The point here is that although it is a mature product from the trade's point of view, it can still be projected as a completely new and fresh product for those investors who have come to recognize gold as an investment vehicle for the very first time," he said.

Toshima estimates that there are now some 540,000 GAP accounts generating more than 30 metric tons in physical gold demand each year.

He is encouraged by Mitsui's move to make its GAPs accessible to more investors.

"It goes a long way to expanding the spectrum of gold investors across the 'man-in-the-street segment'," he said.

FULL STORY

Related Story:
Gold retreats on broker selling, eyes Fed - NEW YORK, Aug 8 (Reuters) - U.S. gold futures edged down before stalling on Monday morning, and traders were reluctant to pressure prices sharply due to the start of a huge strike by gold miners and thin volumes before a U.S. Federal Reserve decision on interest rates on Tuesday, dealers said.

Gold-price manipulation theorists meet in Dawson -CBC
Aug 8, 2005
CBC News

Financiers from around the world are in Dawson City this week talking about gold, and what they claim are government and bank manipulations to keep the price of the precious metal low.

While it sounds like the purview of tinfoil-hat conspiracy theorists, the Gold Anti-Trust Action Committee has respected investment analysts and brokers as members, and has slowly been gaining credibility in investment circles.

John Embry, who manages Canada's second-largest investment fund specializing in gold and other precious metals, is a keynote speaker at the meeting.

He says the United States and other western countries have worked to artificially depress the price of gold.

"The gold price is sort of what I call 'the canary in the coal mine', with respect to the health of the financial system," says Embry.

"And they do not want the gold price rising to where it should be because I think it would suggest to the public that things aren't as quite as good as authorities are telling them."

Embry says the price of gold should be $600-700US an ounce, instead of its current level of about $400US.

He says central banks have kept the price low by selling lots of gold on paper.

Embry says if the owners ever decide they want the actual gold, it would bring on a financial crisis.

He says in the meantime mining communities in the Yukon and around the world are suffering because the price is lower than it should be.

But Paul van Eeden, a gold analyst and researcher, says it's an artificially strong American dollar that's preventing the price of gold from taking off.

"The U.S. dollar still has a major decline ahead of it, somewhere in the order of 20 or 30 per cent," he says.

"And that decline in the U.S. is what will make the U.S. dollar gold price rise from $440 an ounce, where it is now, to about $700 in the future."

Van Eeden says the gold price bottomed out at about $254 an once in 1999, but began appreciating about four years ago.

He says the reason for this is because the dollar peaked between 1999 and 2001, and then started to fall.

Van Eeden believes the manipulation theory put forward by the Gold Anti-Trust Action Committee began in the early 1990s.

At that time, there was a shortage of gold and central banks began selling their reserves, lending support to the theory banks were depressing the price of gold.

Van Eeden predicts the price of gold will hit more than $700US before the end of the decade.

Related Story:
8-10-05 -- Gold and gold equity markets witness rally -Merrill Lynch - LONDON – Analysts at Merrill Lynch say that the annual rally in gold and the gold equity markets has begun. In a research note published this morning, the analysts mention that the S&P/TSX Gold Index has risen 7.1% since July 19, while gold price has jumped 3.9%. Historically gold and bullion shares have risen significantly in the period from early summer to mid autumn, Merrill Lynch says.

COMMENTARY

ONE NATION UNDER DEBT
U.S. debt explosion = dollar disintegraton by 2010
By Craig R. Smith
WorldNetDaily
Aug. 8, 2005

"Are you saying… that to maintain our lifestyle today, Americans are starting to borrow against their home equity and credit cards?"
-JAN MICKELSON, Mickelson in the Morning, WHO, 8/3/05

I've never heard it put quite that way, but "yes" I told the astute radio host from Des Moines, Iowa during a radio interview last week. I went on to make a rare prediction: “Unless Americans make a radical change in our "living-on-borrowed-money" lifestyle (personal and governmental), and oil prices start falling soon, and we begin saving instead of consuming -- I expect we’ll witness the collapse of the U.S. dollar by 2010.”

This month the U.S. national debt topped $7.8 Trillion – up from $5.8 Trillion in 2001. That’s more seconds of time than God has created since Adam and Eve walked the earth!

U.S. News & World Report, 8/3/05 said it clearly this week; "Drowning in Debt?”... "Household debt rose from 96 percent of personal disposable income (consumers' take-home, spendable cash) in 2000 to 111 percent in 2003 to 113 percent at the end of 2004." Scott Fullwiler, an economics professor at Wartburg College in Waverly, Iowa says, "My concern is that as a percentage of disposable income, it's at an all-time high."

No wonder national savings rates are at ZERO -- the lowest since our spending binge in October 2001 and the second-lowest since the Great Depression. Small wonder both mom and dad must work -- sometimes two jobs -- to support a family. Any wonder the U.S. middle class is so prone to borrow from the future to maintain a living standard modeled on the past? (You remember, back when “sound as a dollar” still rang true).

The deficit’s domino effect... FULL STORY

Aug 8, 2004

ECONOMIC SOLUTIONS for the 21st Century -- FREE Offer! ($19.95 value) ... LISTEN: "A Must Read" ... LISTEN: "I SLEEP BETTER!" -Michael Savage

NEW!! -- The Future of Gold and Silver CD Offer! --
Craig Smith Interviews Bill Murphy, GATA -- Recorded: June 1, 2005 (30:00 trt) ... Bill Murphy, founder of The Gold Anti-Trust Action Committee, explains why gold should be $750 and silver $15 an ounce -- nearly twice current prices -- IF major bullion banks would finally stop their market manipulation!

ABOUT THE EDITOR

David M. Bradshaw is Editor of REAL MONEY PERSPECTIVES, a new, syndicated daily financial/cultural news digest. In 2001, he published REDISCOVERING GOLD IN THE 21ST CENTURY: The Complete Guide to the Next Gold Rush and has been an economic commentator since 1987, when he produced the World Economic Perspectives radio show. In 2004, he produced "A CITIZEN'S GUIDE TO COUNTER-TERRORISM" a free-to-the-public educational resource on DVD and CD. In 2005, he released a new CD, "WHAT'S YOUR WORLDVIEW?" a one-hour CD sample from his 24-hour series, "THE BIG PICTURE: The Shape of Things to Come" discussing geopolitical, economic and spiritual trends in the 21st Century. MORE ... PERSONAL NOTE: Youngest daughter Braida Zoe (age 18 mo.) is now feeding herself, running, climbing and floating & swimming. Shown with her mom (and loving wife) Micki.

---

DISCLAIMER: All of the provided information is believed to be accurate, however errors are possible. The opinions in the Commentary section do not necessarily reflect the opinions of Swiss America. Past performance of any investment is no guarantee of future performance. All investments have risk.

---

Special Report Offer:
Housing Boom or Bust?
A Strategy to Hedge Your Dream House

Never before in history have house prices risen so fast, for so long, in so many countries. Property markets have been frothing in the U.S., Britain, Australia, France, Spain and China according to economists.

Over the past five years, the stock market has gone nowhere and consumer confidence has evaporated -- yet housing prices, fueled by 50-year-low interest rates, have continued to soar by as much as 60 percent! No wonder so many economists are convinced real estate is a "bubble" ready to pop.

Is this global 21st century housing boom "unsustainable" and now heading for an ugly ending? Or, are spiking housing prices worldwide just a slight aberration from the normal cycle and will most likely end in a "No problem soft-landing"?

In this Swiss America Special Report we explain:
* Why the U.S. housing market may crash within two years?
* How to decrease exposure to residential real estate?
* Why banks offer larger mortgages than buyers can afford?

IN HOUSING WE TRUST? -- Table of Contents
I. Introduction: From 'irrational' to 'unsustainable'
II. Seven Biggest Risks Facing U.S Homeowners Today
III. How to Recognize a Housing Bubble in Your Market
IV. U.S. Consumer ´Weakest Link´ in World Economy
V. "Debt is Good" - So Preach the Experts
VI. In Whose Numbers Do You Trust?
VII. A "Golden Hedge" Around Your Dream Home
VIII. Your Tangible Asset Portfolio
IX. Conclusion: Thinking Long-Term

Call 800-289-2646 -OR- register below for this FREE Special Report