Dutch Central Bank Sale Announcement Imminent? Message Board

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Politics : Dutch Central Bank Sale Announcement Imminent?

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To: Mark Bartlett who wrote (5491)	4/24/1999 4:26:00 PM
From: Hawkmoon	Read Replies (2) of 81050

Good ... gold does better in deflation. Are you joking??!!! MY GOD MAN!!! Look how gold has performed relative to the CRB (One of the best indicators of global price deflation). Whether it be due to currency devaluations or greater productivity, gold does VERY POORLY in comparison to a global reserve currency. Only when that currency is undermined by Keynesian economic policies aimed at priming the economic pump does gold shine. Lots of jokers like to use the comparison of the great depression in trying to claim that gold retains its value. But let's not forget that the price of gold was controlled until the US went off the gold standard in 1933 in combination with confiscatory regulations removing gold from private hands. They did this because Roosevelt's "New Deal" required HUGE INFLATION of the money supply and gov't debt to force the economy out of depression. But that was then and this is now. Gold will continue to be under pressure until one of several events occurs: 1.) a major war that undermines confidence in Fiat currency and threatens to disrupt the flow of vital commodities like Oil. (Higher prices for vital commodities equates to lower value of purchasing currency) 2.) The global economy bottoms out, resolves its excess of production capacity. 3.) The global economy reaches a point where lenders and investors are willing to risk their capital in emerging markets again, thus spurring demand that will soak up existing production capacity and resulting in higher prices for commodities. 4.) The defecation hits the global "rotary oscillator" in any other manner: Cyber/biological/nuclear terrorism against the US and Europe, resurgence of strong nationalist parties in Russia, China makes a play for Taiwan... But again.. most of those scenarios are basically a repeat of #1 (see above). Where did you learn your economics Mark?? Since prices have been in a general downtrend for years and the POG has followed this decline, you obviously enjoy making a fool of yourself in spouting this non-sensical rhetoric about gold holding its value. Those who sold there gold back in the 1980's (or even early '90s) and went completely to US dollars stuffed in their mattress, are now able to buy back significantly more gold than they once possessed. How can you claim that "gold does better in deflation" with that fact staring you in the face?? The time for gold may come, but I think we all realize that time is not yet. Regards, Ron

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