We have argued before that Oil in reality in very short supply considering longevity of known finds...(Same for Gold) Easier does not mean easy...
Well, that's not what I inferred from your previous post:
Oil is very renewable...Unlike Gold it is much easier to find....Unlike Gold its price is moderated by risks of being replaced entirely by alternative fuel
I'm still waiting for you to tell us how oil is "renewable". And unlike gold which is traditionally priced as a reaction to inflation, oil is generally a CAUSE of inflation since its price impacts ALMOST EVERY economic sector with regard to cost of manufacture and transportation. Oil prices can surge temporarily, but the longer they remain artificially high (due to producer cut-backs and quotas), the sooner market leveling effects will come to bear and adjust prices downward.
Population growth makes Gold already mined, despite wedding rings that used to belong to grandma irrelevant
How do you figure this ludicrous comment?? There exists 14 years worth of production sitting in CB vaults. How many wedding rings do you think this quantity could supply? You have to have continuous demand for gold for its price to be sustained, not just some short-term Y2K fears. What will the gold market have left as a marketing tool once Y2K has passed and all of those physical gold holders suddenly start selling off their caches of "apocalypse" currency?
The gold market went up because a powerful financial element, European central banks, deemed it a useful weapon to wield against the US dollar and the perception of US economic hegemony overshadowing the rest of the global economy. But it will do little to stifle US economic productivity, which will only grow stronger through the exploitation of Ecommerce technology. An area that the rest of the world lags woefully far behind.
So in the short term, you may see weakness in the dollar, but when the damage is done on the market, what will remain will be an even greater buying opportunity in equities. The spending power of the baby-boomers will continue to exert its stong influence on US growth and prosperity throughout the next decade, just as the Japanese baby-boomer generation did for their economy during the '80's. We can only hope that we deal with the eventual economic slump better than have the Japanese.
Regards,
Ron |
