China Warehouse- More Than Crockery Message Board

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Strategies & Market Trends : China Warehouse- More Than Crockery

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To: RealMuLan who wrote (246)	8/9/2003 4:49:39 PM
From: RealMuLan	of 6370

Gold price goes up August 9, 2003 Gold has become the world's ultimate reserve currency, sending the price of the precious metal even higher, the head of the world's largest gold mining company said. Newmont Mining Corporation president Pierre Lassonde proffered a bullish gold outlook at a Melbourne Mining Club lunch, telling mining representatives the US dollar would continue to depreciate against a raft of currencies, pushing up the $US gold price. "Eighty per cent of the gold price is due to the US dollar currency exchange rate," Mr Lassonde said. The other 20 per cent was attributed to the central bank and the growing economic strength of China. Mr Lassonde said the Asian economies of China, Japan, Hong Kong and Taiwan had almost $US2 trillion of reserves. "If they stopped buying US dollars for any reason the dollar is going to tank, and that is what's pushing the gold price up," Mr Lassonde said. "Gold is money. "Ninety per cent of the time gold is a commodity, it is jewellery. advertisement advertisement "Ten per cent of the time it becomes money. It becomes the ultimate reserve currency and that's the way it's behaving." He said structural imbalances with the United States massive trade deficit and GDP, were expected to take a number of years to resolve. "We continue to be very bullish on the gold price because we don't seeing it being resolved very shortly. "And the fact that the US is trying to be the world's policeman only makes it worse. "Wars are the worst inflationary environment because money is spent on bullets that are wasted. "It is unsustainable." Other factors driving up the gold price are the massive dehedging program adopted by producers around the world and the growing economic strength of China, he said. theage.com.au

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