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Gold/Mining/Energy : Strictly: Drilling and oil-field services
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To: stsimon who wrote (75241)10/1/2000 3:43:43 PM
From: BigBull  Read Replies (2) of 95453
 
There is little wrong with the dollar?

Europeans typically enter the US markets very late in the game as they have done this time raising the the dollar to extreme levels, levels it is now almost in no one's interest to see continue. That support will leave quickly once it becomes clear that the strong dollar puts the US at a competitive disadvantage and the US stock market can go down as well as up. The Europeans will sell their dollar assets when they begin to realize that, in a shocking disclosure, their industry is on a much more competitive footing than it was in the recent past. Remember what happened during Reagan's term when the dollar got too strong? US industry could not compete, ballooning trade imbalance; the dollar entered a long bear market. Have you not heard company after company issue earnings warnings based in part on dollar strength? And still there is little wrong with the dollar? The US is effectively imposing a 27% tariff on it's own products and industry to keep late cycle inflation at bay. There is a lot wrong with the dollar, as many American will soon find out. Frankly I hope none of us loses his/her job over it. Because many will. First the inflation has hit other parts of the world then it will hit us. There is altogether too much "magical thinking" about the dollar in my view.

CB's will sell it. Ever wonder who's buying? It sure ain't a bunch of conspiracy nuts buyin all that gold. Pretty soon they will be the ONLY ones selling it. Mine after gold mine is being shut down or cannibalized for parts. Production is drying up. Remind you of anything? Ever seen that before? Correct me if I'm wrong, but aren't the BOE sales due to end after two more rounds? Tony Blair might not even be around that long. Ever stop to think the gold selling might actually be a cause of a weak currency? I know it's unthinkable, but some CB somewhere might just stumble across that notion.

All I know is that the XAU and Gold are now one of the most onesided markets I have ever seen - Gold Bears Resplendant on a sea of Greenbacks. Massive short position on the metal, universal bearishness on the stocks. Hmmmm. It won't take much.

Waiting for Godot? Buggy Whips? Gold is dead? My, my, as bad as all that eh? Hey, maybe you could write an article on the Death of Gold for The Economist?!
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