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Gold/Mining/Energy : Gold Price Monitor

GDXJ 106.75

-0.5%

Dec 3 4:00 PM EST

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To: Jim S who wrote (37097)	7/13/1999 7:55:00 PM
From: Hawkmoon	Read Replies (3) of 116791

You're making a convert of me, Ron. Dammit! LOL!!! But now we get into the more fundamental question of "should gold be considered "currency"?? Or should it be decoupled completely and permitted to trade on its own market dynamics without large stores of it being retained by CBs? I opine that it should, but I hold no real illusions about that ever occuring. But I do think that gold's role will continue to remain under pressure for some time to come (minus a breakdown in the global financial system, major conflict, or some nasty comet slamming us back into the stone age.. :0) I'm a firm believer that a currency should be backed by the strength of its economy or legal principles. Basing currency upon those standards insures that investors will punish any transgression and move their assets to a politically and legally more "secure" haven. Examples of this are: Taxes being raised beyond most peoples tolerance. Result: Move assets off-shore and maybe even elect to change citizenship in order to prevent confication of wealth by an abusive gov't. Freedoms infringed and legal recourses for property owners subverted? Move assets to another financial that will respect the rights of property owners. The fact that so money flows between markets and nations with the speed of light and computer keys has been shown to be an effective (if not destructive) method of enforcing economic discipline amongst various gov'ts. And given the seemingly unbridled leverage that can be brought to bear to "punish" transgressors of economic soundness, it is probably too effective and results in the baby often being thrown out with the bath water. The discipline that gold was supposed to serve as a international standard of exchange is now served by floating exchange rates and open financial markets. The "rub" is how to prevent currency corrections from taking on a life of their own, turning economic admonishment into economic murder. The CBs haven't quite got that down quite right yet. Thus, the requirement for their currency market interventions. Take care Jim... Don't become too much of a convert though. I still welcome your critical insight and review. Regards, Ron

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