Goldsnow:
You know this lower Euro doesn't surprise me in the least. I remember that while I was suggesting that the Euro was built under faulty economics of uniting states, many herre were suggesting that it was/is the last place to hide their bux's. Many suggest that the Euro would see massive cash inflows as Asian investors would move to a better currency. Yet so many never took into account that when the Euro formed, they shoved together areas of high inflation {Italy} with areas of recession {Germany}, and areas of forced stagflation {France}. And with the demise of the US Bux, gold would out shine the economy/markets of North America. Actually Canada fairs better without the gold.
Less then a 6 months ago, I suggested that US rates would rise, and that would cause further cash inflows and a rising US Dollar. Many said that this was paradoxial lie, and couldn't happen. Although the YEN didn't live up to the trend, but the BOJ tried to slip it by Rubin/Greenspan, the Mark and Pound have done what was expected. USA is living in a lie, the economics are skewed... yet people don't see it.
Gold is being demonatarized, as it should. I expect ALL CB to sell all holdings sooner or later. Having Canada, Australia, NZ or any other semi resource country holding Gold only hurts their economies. Very few currency pegs can be held for long terms. Yet holding gold is a defacto peg. This is why Canada has been in many more recessions then USA, this is why they are net sellers. If you, as a country, wish to hold an asset that performs better then gold; then you should hold bonds or notes of those that can affect your economy. This is what the BOJ did with USA in the 80's. And look how well the fear of massive selling of those bonds made the USA turn into a productive power house. Even to the point that Japan is now suffering... Remember 1995 and the YEN breaking 80/USD? Strange how times change... well they don't.
As I write the Euro is testing new lows.
bid/ask 1.0417/1.0421 quotes.reuters.com
Some day Gold will have a chance, but when & why? Some have been calling for $350 since... YEARS NOW. And are acting like desperate Gold neophytes, and will attempt to bring western style justice to the system. But the point is that they just don't understand. Who's selling this gold? Well does it really matter... think about it. When you buy a stock does it matter if Chase bank is selling to you or if it's me? If you've done your dual diligence correctly then it's a buy or short.
Gold will have its time... just don't expect it above $290 this year again. Now the XAU is showing denial...
For Gold Bulls: Gold & Gold stocks do best between the first of the month till options expiration, then they do worse between expiration till end of month.
chart.yahoo.com |
