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Gold/Mining/Energy : Gold Price Monitor

GDXJ 121.93

+0.8%

Jan 9 4:00 PM EST

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To: J. Nelson who wrote (20819)	10/6/1998 12:59:00 PM
From: E. Charters	Read Replies (4) of 116846

Gold is rising more with respect to other currencies in the world. (Canada for instance) So we would say Gold is lowest in respect of the US dollar only. There can be an increase in the money supply without inflation for long periods before the paper worth becomes apparent. This has happened. Real wealth has increases let's say 4 times since 1967 but debt currency (not cash) has increased 1000 times in the same period. For instance Canada's national debt in that time was about 150 dollars per man woman and child, now it is perhaps 150,000. The deficit in 1995 was larger than the debt was then. There is no way that production can pay this debt as the interest dollars now equate to more than half the gross national product. You could fire the entire civil service and not have to pay out one cent in gov't services and the total debt both personal and public in Canada of about 1.13 trillion would not be paid for about 20 years! Because of taxes, the factor of wealth to buy equivalent wealth of the 1920's would have to be the inflation rate of 1.06 to the 70th, times two as taxes now eat 50% of all income just to service the debt. The inflation rate is equal to the difference between wage increases and the the actual increase in wealth. This rate must be reflected in the price of major commodities and energy. If it is not then the inflation is hidden as it is now. The reason is the money is being poured into speculation and buying businesses and bonds instead of into commodities and production. Eventually this will show up as the value of the speculation drops as it does not return wealth (earnings). Gold will eventually show its true worth when catastrophic inflation is revealed. EC<:-}

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