Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: lisalisalisa who wrote (15928)	3/1/2002 5:01:21 PM
From: Snowshoe	Read Replies (3) of 74559

what is HGMCY PE? That depends. The South African gold miners are doing very well because the Rand is depreciating against the dollar, which lowers their cost of gold production. But wait! One of the most cherished shibboleths of the goldbugs is that the dollar is going to crash, so you should store your wealth in gold and gold shares. But if the dollar crashes, won't the South African cost of production skyrocket and erode their profits? Somehow inflation, deflation, a strong dollar, and a weak dollar are all supposed to be bullish for gold! Meanwhile the Germans are itching to sell part of their 3,500 tons of gold to balance the national budget. This would be bullish for the Euro and bearish for the dollar, so I guess it is yet another reason to buy gold! It's all really too complicated for me to understand!

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