I haven't visited this thread in a while, so some of what I say may be redundant.
As best I can tell, the easiest unleveraged bet against the dollar might be BEGBX, the (mainly) European bond fund. I still have not been able to find an annual report or prospectus that specifically lists their holdings, but the fund appears to work exactly inversely to the dollar.
But if the dollar goes into a big decline, two things could happen:
1. As measured against the dollar, the price of gold would rise, if gold's value stayed the same against the Euro.
2. If foreigners with dollar holdings chose to convert some of them into gold rather than other currencies, gold price might rise in an absolute way.
If both these things happened, and I think they easily could, gold as measured in dollars could easily go to $300, a much larger percentage rise than currencies.
On top of that, low-cost, divdidend-paying gold producers such as GOLD enjoy a leveraged position because of their production and their gold reserves.
I therefore concluded that GOLD (the OTC stock) was much more likely to double in price--that indeed it would almost certainly double in price if the dollar dropped by 25% against the Euro. This makes it a better speculation (if you think the dollar is going to fall) than BEGBX, though of course BEGBX enjoys interest income.
Criticisms? |
