Freedom Lawyers of America

August 7 - Gold $314.10 up $8.90 - Silver $4.67 up 6 cents

Debt rating agency Standard & Poor's might lower its rating on J.P. Morgan
Chase

Gold traded differently right from the get-go. It came in $2 to $3 higher
after firm overseas trading and then exploded right after the opening,
easily clearing $310 resistance. It stayed strong all day. Downticks were
short-lived. The best news was gold made new highs late in the session and
overpowered fund selling.

Rumors were flying all around that the move up was due to hedge buybacks.
Barrick was the only specific name mentioned. Maybe yes, maybe no.

As far as I am concerned, this move had Gold Cartel written all over it. We
do know that Morgan Stanley, the big seller at the top of the last move,
was the featured buyer yesterday and today in New York. If Barrick was the
buyer, that is the same as the cabal, as they are closely aligned.

Gold soared early today with the U.S. stock market due sharply higher and
the dollar only slightly weaker. The dollar went sharply lower after gold rose.

Yesterday, the dollar moved higher and gold went lower. That made no sense
to me at all, especially since the action was all about a cut in U.S.
interest rates. A cut in rates is VERY gold bullish and dollar bearish. We
already have negative interest rates in this country. Inflation is already
running a good percentage point higher than the current T-Bill rate. This
morning it was announced that import prices were up .4%, higher than the
.2% expected. Average hourly earnings were up .3% last month. Annualize
those two and you come up with 4% inflation in the U.S. AND THE FED IS
GOING TO LOWER RATES?????

The big question for us is whether The Gold Cartel will be forced to throw
in the towel. We know that the GATA story is spreading, as is Mike Bolser's
brilliant expose of J.P. Morgan Chase. Lower interest rates will encourage
hedge buybacks and investment demand for gold. All of that will put more
pressure on the cabal. Growing credit problems and a sinking stock market
will add to that pressure.

One has to wonder if they can stay the course any longer, or even better,
are getting out right now. One has to wonder how long J.P. Morgan Chase can
stay with their gold short program program with so much focus on CEO
William Harrison, etc?

I am hoping today was an indication of the beginning of the end for these
lying crooks. The gold trading action in New York was not the norm, not
even close.

This afternoon Standard & Poor's announced it might downgrade J.P. Morgan
Chase. This has to be very bad news for The Gold Cartel. Notice the line it
would not take "much more bad news." Morgan's stock was down around 30
cents and the DOW was tanking after this came out. Within hours the DOW
turned around on a dime and soared. Morgan's stock ended up 39 cents on the
day, but was a noticeable laggard. Bob Pisani of CNBC noted that the DOW
rally was due to futures trading. Hello PPT!

Tick, tick, tick:

NEW YORK, Aug 7 (Reuters) - Debt rating agency Standard & Poor's said on
Wednesday it would not take "much more bad news" for it to lower its rating
on J.P. Morgan Chase & Co. Inc. from the negative outlook it now has on the
bank.

"We do feel (J.P. Morgan's) liquidity is intact, if that's what's worrying
people, but its performance has been mediocre but stable in each of the
last two quarters and we look for that to continue," S&P analyst Tanya
Azarchs said on a conference call. S&P now rates J.P. Morgan's corporate
credit "AA-minus," its fourth-highest investment grade, with a negative
outlook.

"With J.P. Morgan and the negative outlook, it wouldn't take very much more
bad news for us to downgrade on that, and we're watching Citigroup Inc.
closely for the legal issues predominantly, as well as Latin American
issues," Azarchs continued. Congressional allegations that J.P. Morgan and
Citigroup lent money to Enron Corp. via disguised commodity trades that
enabled the bankrupt energy trader to hide debt and inflate cash flow have
hurt the banks' shares. Wall Street is concerned about legal liabilities
the banks might face over Enron ties.

"At this point, we have said that we cannot estimate, or even begin to
estimate, what the outcome of those lawsuits and legal issues might be,"
Azarchs told investors on a call to review banks' second quarter earnings.

"It may be nothing, or it may be bigger numbers." S&P's Azarchs sees some
merit to the banks' stance that their Enron dealings were appropriate based
on available information, but she said a push to go after Enron-linked
companies with deep pockets might mean higher-than-normal punitive damages
for the banks. U.S. banks also are wrestling with soured loans resulting
from major corporate bankruptcies as well as consumer loan losses in the
slack U.S. economy.