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Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (262)	6/7/2002 4:05:42 PM
From: Wharf Rat	Respond to of 89467

financialsense.com Sundance

To: Zeev Hed who wrote (262)	6/7/2002 4:14:04 PM
From: Jim Willie CB	Read Replies (1) \| Respond to of 89467

I am aware of the cyanide gold extraction process would you believe I opened my old college chembook in March? it had the precise chemical reaction formulas but that hardly compensates for the 20% expected decline in world production by 2010 that figure is spouted by the Mining Institutes the recent trend is down clearly and it doesnt compensate for depletion of some of the best mines (below world prices in recent years) I have found the forward sale money engine to be fascinating it has proved to accelerate wasteful production during low price downtrends you continue to focus on supply issues but it is the demand side that has changed recently - Japan and Asian and Arab buyers - near zero real rate discourages shortend bondholders - diversion of OPEC petrodollars into gold - rising price seeing paradoxical rising demand but I am glad you mentioned one thing: no inflation gold is just as effective in preserving capital in deflationary times we are seeing worldwide deflation now, in a big way Japan has seen several years of deflation it took lost depository gaurantees to push them to the edge Japanese gold investors who turned their backs on CD's and Nikkei stocks avoided 50-80% losses (before the Nikkei rose like the rising sun) I believe gold's big demand will come from deflation's effect on equity prices, on product pricing power, and more in 1980 gold rose from inflationary pressures in 2000's we will see gold demand rising from deflation we now come to the same stagflation scenario from opposite ends but we agree totally on demand for gold factored to dollar weakness so that answers a key question: you believe gold is monetized as gold continues to rise, will Central Banks sell a rising asset in favor of a falling one with their currencies? I dont think so and that might prove to be a bigtime foundation for gold I believe CB's will "tolerate" gold rising versus their currencies expecting it wont get out of control but I suspect it might, since it always does called "gold fever" thanks again, Jim