Palladin, I don't disagree with anything you said, except for this: I think that the U.S. economy is extremely unstable now. It is a house of cards built upon a Credit Bubble of historic proportions. This Credit Bubble WILL implode, although I can't predict when this will happen. We (corporations, individuals, and government) have been living beyond our means in the U.S. for at least a decade, particularly in the past five years. As the amount of credit has become more and more extended, the regulations on lending institutions has eased, and with Easy Al at the helm, money has been printed with reckless abandon to keep the machine oiled. Now, finally, whether triggered by the ongoing equities implosion or by September 11 or some other manifestation of the Middle East unrest, bankruptcy rates have begun to increase dramatically. THERE WILL NOT BE A GENTLE LANDING.
Anyway, that's what I think. Add all those factors to the recent long-term bottom in gold, and I think you've potentially got the makings of an irrationally overvalued gold market, seventies-style. Time will tell.
Dave |
