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

To: Claude Cormier who wrote (67333)	4/8/2001 1:38:38 AM
From: Hawkmoon	Read Replies (4) \| Respond to of 116764

Gold was stable because humans were placing arbitrary valuations of exchange on it. Even now the US currently values its gold reserve deposits at $42/ounce, despite the market value being $220/ounce higher than that. But since we've gone off the gold standard, the value of gold relative to the dollar has been extremely volatile. Sure it would have been good to own gold over USD's during the late '70s and early '80s when it ran to $800/ounce. But since then it has been on a major decline relative to Fiat currencies, even though the majority of existing gold reserves remain non-accessible to the physical market. The value of gold, like the value of oil, depends on its supply. And as the Spanish discovered after shipping all that gold over from the new world, it can lead to major price inflation. A similar situaion occured during the california gold rush where eggs were reported to be selling for $42 apiece. Thus gold is susceptible to many of the same forces that regular currencies are. And even if equity values fall lower, or remain stagnant, AAA corporate debt and certainly US debt will remain stronger than that being issued by competing nations whose economies will slow faster than here in the US. That's my major theme about what is going on here. The US is in a FAR BETTER financial situation than it's competitors. The US public debt is equal to 37% of the US GDP. Japan has a 130-150% ratio to their GDP (and a quickly declining tax base). Europe also has heavy social entitlement to be paid for that logic dictates, exceeds similar liabilities faced by the US. And everyone else is dependent up those 3 economies for growth so that they have willing markets for their products. Regards, Ron