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

To: Joan Osland Graffius who wrote (5580)	2/12/2002 7:04:11 PM
From: Moominoid	Read Replies (1) \| Respond to of 33421

There is little logical reason why the AUD tracks gold more or less (technically in econometrics we would say it cointegrates). Other factors obviously are the interest rate differential between us and the US, how the Yen is doing etc. But if you check the charts it has tracked. It is believed by the media/market economists that equity investment flows are a large driver. But again the gold sector though active is a fraction of a fraction of our stockmarket. So now that gold looks like going up in the next couple of years maybe the Aussie will. Maybe though it will be just our bad luck it decouples. I'm not sure where PPP is. On the basis of food 1 AUD = 1 USD. But computers, clothes, books etc are the same price more or less in the two countries. Gasoline is now again more expensive here. Cars may be a bit cheaper here. Rent in Canberra is comparable to small towns in the mid-West. In Sydney to cities such as Atlanta perhaps. Some services like haircuts/medicine etc. seem to cost more than twice as much in the US. Average salary here is around $A40000 a year (median lower of course). Minimum wage is $A10 per hour (but that is a higher percent of the mean than in the US. Best guess is that 75 cents still is a reasonable PPP price. David