Waiting for the big Kahuna Message Board

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Strategies & Market Trends : Waiting for the big Kahuna

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To: Qualified Opinion who wrote (75145)	4/3/2007 2:13:33 PM
From: Real Man	Read Replies (1) of 94695

Prices could correct in 2 ways 1) asset prices go down 2) the dollar goes down, asset prices stay flat. (stagflation of the 70-s) stockcharts.com In 2000-2002 the former occurred, while since 2005 the latter was happening. Either way, the Dow/gold ratio should come down to about 1-2 before the secular bear ends. Despite the new high for the DOW, DOW/gold ratio is down 60% from 43 in 2000. Thus, all of the secular decline so far occurred via currency debasement.In a competitive debasement (lately) gold soars in all currencies. I think stagflation again is very likely - low growth, high inflation. The Fed then can't do anything. Gold makes sense as a long-term investment, even though if US goes into recession soon (likely), it could drop significantly.

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