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Politics : Dutch Central Bank Sale Announcement Imminent? -- Ignore unavailable to you. Want to Upgrade?

To: Enigma who wrote (6644)	6/23/1999 10:29:00 AM
From: Hawkmoon	Read Replies (2) \| Respond to of 82066

Too much emphasis is being placed by you on the mining cost factor sure gold can be mined for less - but the mine supply/industrial demand equation is in deficit. So you call gold coinage, which the gold industry and so many others are frightening and duping an unsuspecting public into buying on Y2K fears, industrial usage? I don't. Exactly how much of the annual production of gold actually is used for "industrial" purposes, excluding coinage and jewelry?? How much is used by the electronics industry? Exclude the jewelry and coinage markets and THEN figure out whether you have a deficit. Were there a deficit, I can tell you that industry would be bidding up the price of gold to the point that coinage would not likely be being "pushed" upon the public. It would be diverted to TRUE industrial use. Think it through, DD. Think it through. Show me an overall global economic environment where demand outpaces supply, and then you may find me agreeing with you about gold's appeal. Regards, Ron

To: Enigma who wrote (6644)	6/23/1999 11:11:00 AM
From: Zardoz	Read Replies (2) \| Respond to of 82066

Too much emphasis is being placed by you on the mining cost factor - sure gold can be mined for less - but the mine supply/industrial demand equation is in deficit. So the main problem is on the speculative side - most speculative money over the last few years has been sucked into paper assets and away from hard assets like gold - the gold market is thin compared to paper in all its forms including derivatives. In a perfect world, there are many people willing to take on risk. Vegas are full of them. Yet within Vegas you have specialists {card counter, poker demigods, and even tricksters} and like the financial markets you have much the same. And if people find risk acceptance tolerable, they will offer risk management options to others. And is that not one of the reasons the gold is under performing the risk volatility curve? You may very well say that the speculative cash has been sucked into paper assets, but that is only one side of the coin. If I produce an item for 10% less then another person produces the same, I can afford to lower my costs to drive out the others. Yet in lower my price I may create a greater demand. BUT that greater demand has NOT materialized for GOLD. www.wgc.org has demand and supply data ... GO LOOK. So in undercutting others, the margin price must fall. Now if I sell my item {Pink Flamingo's} so that it's well distributed over the speculative world. How long before someone with a collection of them tries to sell them on the open market, say in the forum of an auction {CB's}. And further to that, does the excess marginal surplus push the price differential lower? If a person buys a gold bracelet, he's unlikely to buy two, regardless of the price. Price acclamation is unlikely to increase demand beyond a limited percentage. Have we acquiesced that margin demand has not increased while the POG has fallen? And if so, then has not the fundamentals change, and is now linked to the margin cost of production, And currency components of the actual price of gold. And with the above said, it is possible for GOLD to remain within a trading range for years, as it would be linked to fiscal, economic, and monetary policies. Perceptions change - the gold market will IMO surprise everyone - it won't take much disenchantment with paper for this to happen. Well now, there's a little slice of nothing. Perceptions change hourly around the markets, and then a few seconds later; change again. But even when perceptions change into a commodity/currency hedge, you are still limited to the factors that govern the connection to the rest of the markets. And a temporary rise becomes a selling opportunity; just as {my opinion} this temporary low in gold has become a buying opportunity. But as far as commodity price goes, the price of GOLD is still overvalued. But as far as currencies go, the price of gold is undervalued. I know DoubleD that you have a problem separating the two from each other, yet that can be done easily. And as the to fight it out, it's the BOJ intervention that has stalled the rise in the POG. Maybe they have an interest in bidding for the BOE gold? It really bugs me when the BOJ intervenes. Last time I held options on ABX they did the same thing.