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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Archie Meeties who wrote (59816)	10/15/2000 10:13:54 AM
From: Box-By-The-Riviera™	Respond to of 116759

isn't one approach to a gold play also in thinking not so much about dollar strength or the poor state of US and other market fundamentals.... but rather all of these things are really wide open to receive large shocks of one kind or another.... if the world wide plunge protection teams lose control...... isn't that the gold play?

To: Archie Meeties who wrote (59816)	10/15/2000 12:33:45 PM
From: Rarebird	Read Replies (2) \| Respond to of 116759

<The strength of the dollar is contingent on the continued purchase of US equities by foreign investors, which in turn is dependent on the perception of growth in US companies exceeding those in foreign nations (chiefly Europe and Asia).> Do you expect the growth rate in the US to fall below that of Europe and Asia? Why should Europeans and Asians stop buying US Treasuries here? Foreigners have also been buying US companies, which ultimately puts upward pressure on the US Dollar. Deutsche Bank just recently made a bid for NDB. Moreover, the price of oil is denominated in US dollars and puts upward pressure on the Dollar as it rises in price. US Treasuries serve more of a safe haven than Gold does in the initial stages of an economic downturn. At some point, if and when the economic downturn turns into a hard ugly landing or recession, then Gold should rally strong. But that is a big presumption to make at this point. However, during a money crunch, in which the Federal Reserve is tightening monetary conditions, or when a financial crisis is brewing, short term rates can jump sharpely, sometimes to way above long term rates, thereby generating a negative yield curve. To measure the yield curve I use Moody's Aaa Corporate Bond Yields as the long term rate, and six month commercial rates as the short term rate. neatideas.com neatideas.com I don't see a negative yield curve here at all. I think there are a lot of intangibles that move the POG. Confidence in the System is a big factor. Whether you personally like Clinton or not, the fact is that he is perceived as a very strong leader here in this country by the vast majority of US citizens. The strong Sept 98 rally in the POG was a direct result of the initialization of the Impeachment Process against Clinton, along with some deflationary economic factors at the time. The yield on the long bond fell fairly dramatically too, which was also significant. I see a Gore or Bush Presidency as being better for Gold down the road. But we are not there yet. If the inflation rate can exceed the growth rate here, then gold should do well. <If you're waiting for the dollar to fall for gold to rise, why not just say you're waiting until gold goes up to think that gold will go up?> If you remember correctly, the dollar began to fall in the summer of 99 and the POG fell right along with it. That may have been a little unusual but good news tends to be ignored in a bear market. I was buying gold stocks and bullion at that time. I fully participated in the late Sept/early Oct 99 gold rally by going long gold as the dollar was declining. I was one of the big gold bulls at the time on this thread. I don't see a good fundamental reason to go long gold stocks yet and I haven't seen one presented.