Gold Price Monitor Message Board

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Gold/Mining/Energy : Gold Price Monitor

GDXJ 113.82

-6.4%

Dec 29 4:00 PM EST

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To: Zardoz who wrote (56503)	7/19/2000 5:28:52 PM
From: pater tenebrarum	Read Replies (2) of 116835

clearly the inflationary commodity price shocks of the 70's and the Fed's reluctance to curb the money supply growth in reaction until Volcker came along were responsible for the rise in the gold price. your assertion "it had no basis to form a market price on" is meaningless. care to elaborate what that is supposed to mean? gold definitely HAS a special role. it still forms part of the reserves of the most important CB's, and as long as that's the case it has a special role. the XAU remains a buy. or are you trying to say that one day's decline proves anything? the PoG went down as well, nevertheless, the PoG/XAU ratio remains at an historic extreme. Bob posted earlier that if the ratio were to return to its 16-year average, the XAU should be at 74 at current gold prices. the conclusion is that the XAU already discounts a lower gold price and offers therefore a good risk/reward profile. we will eyeball the chart again in a while...

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