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To: Zardoz who wrote (49053)	2/15/2000 1:51:00 AM
From: Rarebird	Read Replies (2) \| Respond to of 116796

< How many recessions weren't preceded by an inverted yield curve> A lot. I know the Market has been wrong many times and has misjudged before. < Why would you suspect is the reason why CB's are disinvesting themselves of gold?> What a loaded question! When you say " cannot valuation of monetary economics result in multiple decades trends where currencies appreciate," you seem to be placing the CB's, in particular, Greenspan, with the technical monetary prowess to be able to maintain this strong dollar and economy! You may be right. But he is still human and he may over shoot raising rates, causing a recession. I hope not. The key is the Nasdaq or Technology. I say Technology is the enemy of Gold because it is a Great Inflation Fighter and it represents growth. The hope of gold lies in the decline of technological growth and productivity. To be sure, Values are a major factor here too. The future and progress of the Information Age lies in Technology not a higher POG. I would expect the CB's and powers that be to act accordingly. It would be immoral for them to do otherwise.

To: Zardoz who wrote (49053)	2/15/2000 2:13:00 AM
From: paul ross	Read Replies (1) \| Respond to of 116796

<<<< With this said, why would you suspect is the reason WHY CB's are disinvesting themselves of gold?>>>>>> NEW YORK--(BUSINESS WIRE)--Nov. 18, 1999--Gold will continue to play a very significant role in the world's central bank reserve systems for much of the next century, said Robert Mundell, the new Nobel Economics Laureate, today. The presentation, held at the Waldorf Astoria, ushered in a new era for the legendary coin in the United States. It also marked the start of an international initiative to increase gold investment demand. Professor Mundell, who is the C Lowell Harris Professor of Economics at Columbia University, was recently awarded the 1999 Nobel Prize for Economic Science. He was speaking at a press briefing ahead of a major conference on gold as a reserve asset which is being held in Paris by the World Gold Council. He said that while the U.S. dollar was the most important reserve asset today, the growth in total reserves of central banks around the world would ensure that gold maintained its place. ''There are $2,000 billion or reserves in the world's monetary system and that amount will double over the next 12 years,'' he said. ''The bulk of reserves today are in U.S. dollars, but the bulk of that growth cannot be in dollars.'' Professor Mundell said a large part of the growth might be in Euros but part of it would result from a rise in the value of gold reserves. He said that he believed that the total physical amount of gold in the monetary system was unlikely to change; while some central banks may sell gold others would be purchasers. ''I think the total stock of gold in the reserve system in 12 years will be the same as now - I do not see any huge shifts of gold out of the system. Existing stocks may be redistributed around the system - I do not see the physical stocks of gold getting larger but if it maintains its position the price of gold will have to go up.'' Professor Mundell predicted that if the total amount of reserves were to continue to grow at 6% - the rate of growth of the recent past and if the dollar and euro exchange rates remained constant - the price of gold could be expected to rise to around $600 an ounce by 2010. ''I do not think that is an outlandish figure. Gold is a good investment for central bankers.'' He argued that gold would certainly be a reserve asset in the next century. ''Countries will simply not risk just holding paper currencies, especially if there is any change in the international monetary system. ''Gold provides a stabilising effect in a world of entirely flexible currencies,'' he said. ''The world has only had 28 years of total paper currencies generate inflation.'' He said that central banks have to think of the longer-term future. Although countries had learnt from the experience of the 1970's and put in place defences against inflation, nobody could be sure that these would be successful in preventing a return of inflation in all circumstances. If there were an upsurge in inflation as in the 1970's, gold would have an important role as a hedge.