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Gold/Mining/Energy : Gold Price Monitor

GDXJ 114.30

-0.5%

Dec 12 4:00 PM EST

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To: goldsheet who wrote (94842)	5/2/2003 11:51:17 AM
From: Real Man	Read Replies (1) of 116814

One of the things CBs do is increase paper gold supply. Gold is subject to fractional reserve requirements, which are the same as for paper money. This means you can effectively increase gold supply 10-fold, as compared to actual gold sitting in CB vaults. The net result - this "paper gold" (aka gold certificates) acts as increased gold supply, even though actual gold stays at the same level or declines. Gold investment demand in 2002 hit a 35-year high, according to Forbes (CPM). That more than compensated the jewelry demand slump. P.S. 255-290 range at USDX=121 converts to 321-366 range at USDX=96

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