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To: Ilaine who wrote (61)	3/23/2001 1:07:52 PM
From: Don Lloyd	Read Replies (2) \| Respond to of 443

CB - ...As long as the population of the world keeps growing, there will be increasing demand for some things like food, and if supply is inelastic then the price will go up.... I'm not sure which side you're referring to here but you're correct in either case, but are making the wrong conclusions. If there is a fixed amount of gold, and an increased demand for it, the value of gold will increase and the amount of ounces of gold required to exchange for some other good may decrease, depending on the specific good. There will be no shortage of gold or gold certificates because the certificates will be 100% gold backed and denominated in ounces of gold. There will be a certain amount of gold, some of which is held in reserve as backing for the gold certificates, but the gold reserves can no longer serve any other purpose unless and until the certificates are redeemed. Also remember that the long term productivity growth of agriculture is about 3.5%. This means that the competitive pricing of agriculture products falls over time. This is true of most products. Both productivity growth and increased monetary gold demand result in an increased goods exchange rate (value) for gold, if the supply is not increased. This is NOT a problem, at least in moderation. I don't think my explanations are either concise or convincing. See if you can dig out something of interest or value and just ask a focused question to see if we can get back on track. Regards, Don