At a bottom now for gold? Message Board

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Gold/Mining/Energy : At a bottom now for gold?

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To: Bobby Yellin who wrote ()	7/13/1998 10:00:00 PM
From: Vieserre	Read Replies (1) of 1911

Well the theory that the yield curve was flattening due to deflation got hit today with the sharp drop in bonds. It appears it was indeed due to safe-haven buying, which is now expected to be relieved in view of today's Russian and Japanese announcements. It will be interesting to see where it settles on inflationary expectations now that a 3-month uptrend has been broken and with the rise in European currencies. The IMF's finger in the Russian dike, the improving Korea economy, and the failure of the Yen to collapse have damaged the deflationist's foundation. The foundation is also built around the CRB. But, I wonder how much of the decline in the CRB price can be simply attributed to over-production of oil which the Asian fall-off merely exacerbated. The foundation keystone would appear to be the contineud weakness in gold. But some monetarists claim the low price is due to lack of liquidity and the Fed should increase the money supply presumably on the basis that the price of gold is relative to the amount of dollars in circulation or the acceleration thereof. But I had thought the money supply was already excessively increasing - AHHAHA, or anyone else, any comments?.

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