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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 233.22+1.8%Nov 28 9:30 AM EST
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To: re3 who wrote (108861)9/23/2000 2:40:48 PM
From: GST  Read Replies (1) of 164684
 
Ike: The only three reasons I have owned gold stocks (there is an admission of "I can also be stupid" if there ever was one). By the way, not a day goes by when I don't ask myself why I own any crappy gold stocks, but the potential value as a relatively low cost hedge keeps me in them (a hedge is obviously not supposed to be the main portion of your assets).

1. It has a short position under it big enough to blast lower Manhattan to the moon.

2. Its price is inversely related to the dollar and the dollar will eventually be tripped up by an overheating economy and followed by a slowdown scenario -- we may be getting there now. That is why it pays to understand little details like the size of the US current account deficit. Think of like a credit card bill where you maxed on the card but don't worry about because you ahve the cash flow to pay the interest -- until one day the payment is huge, you lose your job, and all the credit card companies want all their money, not just the interest, to be paid immediately -- at that point the US dollar has its turn and goes sharply down along with all US denominated financial assets.

3. Related metals like platinum and palladium will be needed for the first stage of the hydrogen economy, and both metals are in relatively short supply (which explains their stronger performance). At some point, the metals will be moving in tandem. In this sense, companies like SWC are seriously undervalued, which is why I own it for the long-haul.
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