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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Frank Pembleton who wrote (15891)	3/1/2002 5:40:32 PM
From: Moominoid	Read Replies (2) \| Respond to of 74559

Gold has been a mugs game for the last 20 years too. The difference between these currencies and gold is that the former are fundamentally undervalued compared to purchasing power parity, while gold is more expensive than its cost of production and at current fundamentals seems correctly valued. Gold needs a big pick up in demand or inflation (to raise costs) in order to take off. The $A and maybe $C in theory need just a return to equilibrium - in 1996 the Aussie was worth $US0.80 in meantime gold fell from $US400 to $US250 and Aussie as far as $US0.47. So currently the Aussie is undervalued in gold terms even. I've basically been saving here and spending USD whenever I get the chance. Now it looks like I am moving back to the US and will start earning USD again. So I can sit a wait a while on my Aussie assets to appreciate in USD terms. David