11 January 2004-- The Department of Homeland Security lowered the national
color-coded advisory level to yellow or "elevated" last week after the holidays
passed without incident and the amount of specific threat information lowered to
manageable levels. By his own remarks, Secretary Ridge all but openly criticized
the effectiveness of the color-coded system, noting that various geographical
areas of the country will remain on "high" alert and certain public and private
entities will do the same. We have verified that private couriers (DHL, FedEx,
UPS) were recently advised by the Department of Homeland Security to step up the
security of their physical assets to unprecedented levels. Law enforcement
agencies in New York, DC, Las Vegas, and Chicago were also advised to maintain
their high alert levels. The nations nuclear power plants also remain at high
alert levels based on the directives from the Department of Homeland Security,
and cruise lines have recently been alerted to possible attacks and hijackings
while at sea. Accordingly, the threat is far from over, and is highly specific,
something the color coded alert system cannot properly or effectively address in
its current state.

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During a conference early this morning with Mr. Steve Quayle regarding the
various threat levels, he pointed out a number of market indicators that are
eerily reminiscent of the weeks preceding the attacks on 9/11. It is no secret
that there was unsavory market play with certain airline stocks in the days and
weeks before 9/11. In retrospect, this was more than a coincidence and an
indicator of prior knowledge of the use of airlines in the attacks.

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Currently, one of the most well informed economists is making some very
interesting and disconcerting statements about the next few weeks. In his
editorial of 9 January 2004, Mr. Jim Sinclair stated (scroll down to Gold Market
Summary):

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"I want all of you to be very careful as this month comes to an end. Home is a
nice place and a home in the country and away from major population centers
might be a great use for your profits."

--Jim Sinclair, Gold Market Summary, 9 January 2004 08:19:00 EST

I would urge everyone to read his column posted on 9 January 2004 in light
of the market events that preceded 9/11, the specific warnings identified by
Steven Quayle within the last six months, and the raw intelligence we have
gathered as well. Based on these indicators, it is our position that the
specific threats to the US remain at their highest since the events of 9/11.

Douglas J. Hagmann, Director