At a bottom now for gold? Message Board

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Gold/Mining/Energy : At a bottom now for gold?

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To: Ray Hughes who wrote (1189)	6/23/1998 12:51:00 AM
From: Giraffe	Read Replies (1) of 1911

>>Do you understand that majority of gold production is now not labour intensive and, therefore, tendency for inflation to elevate gold mining costs is not operative today. POG protects us from inflation only if the cost of producing gold climbs if inflation translates into rising gold mininig wages not offset by gains in productivity<< A strange argument. I wasn't aware of any significant relation between the POG and wage inflation of gold miners. Were the black miners in South Africa getting huge wage increases in 1979-80? Was that why POG shot up? >>Central banks have virtually unlimited gold supply. << Virtually unlimited? >>Gold is dead. << May be true. But at the time when a huge double bottom is forming on a chart at the historic lows I wouldn't be too quick to say something's dead. Commodities often go up or down for a long time and then turn the other way. Your point about changes in the monetary system is well taken. However it remains to be seen whether in a crisis people will be as happy holding a truckload of promissory notes as their neighbour who's got a pocket full of gold coins.

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