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

To: Crimson Ghost who wrote (63912)	2/17/2001 3:08:23 PM
From: sea_urchin	Read Replies (2) \| Respond to of 116764

George: I don't know whether you have seen this chart by Bob Johnson but, as far as I am concerned, this picture is worth more than a thousand words, even from someone as esteemed as Zeev. goldsheet.simplenet.com In fact, every serious gold investor should bookmark this site. The graph shows clearly that 1. CB sales account for only a very small proportion of total gold sales 2. CB sales are less than scrap sales and are a small fraction of mine production 3. total gold sales are increasing year by year and in 1998 were more than 50% greater than they were in 1988 (That's a growth in demand of approx 7% pa). On the basis of this information, it is clear that mine production is the major determinant of the gold price. In fact, in the circumstances and in contradiction to so much that is written, one has to view the CB contribution to the setting of the gold price as relatively unimportant. Furthermore, there is no evidence to support the contention that gold, as a precious metal or even a commodity, is being progressively "phased out" . In fact, it is the opposite which is true --- demand is increasing all the time, admittedly at lower and lower prices. -------- Bob, if you read this, I see it's time to update the chart. Thanks.

To: Crimson Ghost who wrote (63912)	2/17/2001 8:32:28 PM
From: yard_man	Respond to of 116764

his position cracks me up -- gold backed currency inflationary? -- bunk -- It is the exact opposite of what he says -- currency that may be printed without limit is inflation. A stable monetary base and a growing economy will not produce price inflation -- quite the reverse -- as the money stock remains relatively stable and there is growth in goods exchanged -- same amount of money chasing more goods -- price levels would have to fall in general. Money can be neutral -- it isn't now. If it was, the change in general price levels wouldn't be terribly important But when currency (and credit) can be created without constraint (i.e. savings) all kinds of misallocations occur -- it really doesn't matter whether the price inflation happens or not to the extent that damage is being done (in some ways it would be better if the price inflation happened -- would get the attention of the masses) ... a lot of supposedly smart people have ruined us by getting us to focus on the wrong things .. He is trying to analyze gold simply in terms of supply and demand -- with the gold derivative market so much bigger than the world's annual production -- what kind of sense does that make? CBs have power, but that power is limited. Should there be serious capital flight from the US, I don't think announcements of puny CB sales will keep a lid on gold prices It will be interesting to see what he and others have to say when the gold derivatives market breaks down ... I'm willing to bet it happens this year or next.