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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: MulhollandDrive who wrote (4868)	10/16/2001 10:05:29 PM
From: Yorikke	Read Replies (1) \| Respond to of 33421

'Do you consider low or no inflation and falling interest rate environment bullish for gold? ' Are we doing the mambo? Is there going to be a special prize when we reach 1% or zero interest? Out of context falling interest rates are not bullish for gold. But in this pumped up, pimped up environment I don't believe that the standard rules will hold. Question? With all the money pumped into the economy, with the low interest accelerator on that extra money, why is inflation so low? I would venture to say that the demand side, even in an over stimulated monetary environment, is very very weak. When it is finally realized that we all can not get 'money for nothing' and 'chicks' for free the house of cards may crumble quite fast; as it has been slowly doing over the last 18 months. In that environment, inflation will be zero or less and gold may look very, very good as a store of wealth. Gold has its own cycles, it has been wavering at these levels for months. Short term I expect to see it fall. But when the turn does come it should move up well over the next year. . Finally, though I understand everyone's general reluctance to get involved, the metals sector has enjoyed a significant appreciation over the last year. A 5 year bear is weakening further every day. Real producers are still undervalued and higher gold prices will accentuate that undervaluation. It's an interesting sector. Here is a sample of gold producer results since November 2001 or so. siliconinvestor.com Again in the short term these results are likely to deteriorate, but I think it will turn around and continue the upward swing. (bwdik) regards, yorikke

To: MulhollandDrive who wrote (4868)	10/17/2001 12:00:22 PM
From: John Pitera	Read Replies (2) \| Respond to of 33421

Hi Mrs. Peel, possibly what the gold sector is trying to say Message 16515733 But in keeping with your point about the deflationary trends that we have been clearly living through...a few data points: The deflationary implications of a technology-led slowdown are particularly evident in the third quarter results from the world largest semiconductor maker, Intel. In order to protect recent gains in market share by rival Advanced Micro Devices, Intel has slashed the cost of its Pentium 4 chip by as much as 84% since its November debut, with another wave of cuts expected to hit later this month. Of course, such discounting has found some semblance of credibility as Intel captured 77.5% of the microprocessor market, up from 76.7% in the earlier quarter. At the same time, AMD saw its share pull back to 21.5%, compared with 22.2% in the June period. .......The next stop on our deflation tour takes us to Singapore. While most of the attention today has been focused on the 30.7% year on year plunge in non-oil domestic exports, we found the 11.5% year on year increase in August retail sales volumes even more interesting. Given that retail prices fell 4% year on year that month, the sharpest drop in the past three months, it seems that National Day-related sales may have been responsible for most of the upside.