Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Roebear who wrote (52332)	5/27/2000 1:11:00 AM
From: Mike Hermann	Read Replies (1) \| Respond to of 99985

an ounce of Au will still buy a relatively good suit!

To: Roebear who wrote (52332)	5/27/2000 12:44:00 PM
From: Jacob Snyder	Read Replies (1) \| Respond to of 99985

re: "a tough row to hoe for the gold bugs." Yup. There has been a fundamental shift in attitude toward gold. With the Asian and Russian credit/liquidity crisises, I expected a spike in gold prices. With the trough and then upturn in U.S. inflation, I expected a increase in gold prices. It didn't happen, and that made me reconsider my basic assumptions. My conclusion is that gold has value in jewelry, and as a minor industrial metal, and that's it. Not as a "store of value"; not as a "safe haven". You're right, a dollar has value only because we have all collectively agreed that it does. It is a convention, a habit, and it involves Faith in those who control the currency. There are certainly many examples of that Faith breaking down, and a currency becoming worthless. But the social/economic/political conditions that presage a collapsing currency are not present in the U.S., and there are no warning signs. The people and institutions in power remember (with fear and dread) the last bout of inflation, and will not let it happen again. The Fed, 6 months from a general election, is so worried about inflation (all the way up to about 3%) that they have changed from 1/4% to 1/2% rate raises at every meeting. And they have promised, over and over, to keep doing it until the labor market gets less tight, and consumption slows. I'm sure Greenspan would like to be done raising, as the election approaches. But, if the unemployment rate keeps falling, and consumers keep spending, he's already committed to keep raising, as long as it takes. And we will all Keep the Faith.