Precious and Base Metal Investing Message Board

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Gold/Mining/Energy : Precious and Base Metal Investing

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To: TheBusDriver who wrote (15550)	8/5/2003 3:33:23 AM
From: Step1	Read Replies (1) of 39344

slow day here so i had to jump in... Wayne, i don`t know what it will be , deflation or inflation but it seems we can get both at the same time. Now for deflation, i have seen a lot of very smart people make good cases for deflation and i personally lean that way myself. Say a person is drowning (US consumer) in the sea (of money) you can either throw them styrofoam boards (refis) to help them float a while longer but certainly adding more water (printing money) will not help ("All this water and not a drop to drink"). I am sort of aimless with this analogy here, just thinking outloud... Say you added enough water to the point where some distant coast would start getting flooded ( Japan and China purchasing US debt, soaking it up in other words) at what point would you expect these distant coastal inhabitants to start getting worried? Again i am not sure myself where i am getting at, but it seems to me that deflation becomes unavoidable as adding more water in the sea becomes progressively useless as the body of water gets bigger// and or it becomes progressively unbearable to coastal inhabitants . So for base metals, if the domino reaction you refered to does happen i.e. a drying up of recycled usd credit to us consumers which impact purchasing of imported goods mainly from Japan and China, then you enter the perfect deflation vortex and that can `t be good news for base metals... It is all so simple since it rests on only two words, but which is it going to be: In or De - flation? (stagflation I consider a mutant of inflation) I made my choice and went with Gold, some PGMs and a little Ag. step1

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