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To: SirRealist who wrote (184063)	7/28/2002 11:49:28 AM
From: SouthFloridaGuy	Read Replies (3) \| Respond to of 436258

Sir Realist, I dumped all my gold stocks earlier this week when HUI broke 120 level. The week prior I had gotten whiff (skimmed) Prechter's Conquer the Crash and I really began to question my gold thesis (market falls, gold goes up indefinitely)...when gold broke down I started to read the book in full force. It's truly monumental in my eyes. Alot of people like to talk about Homestake Mining going up during the Depression. Prechter argues that it makes sense that Homestake rose because gold prices were fixed - they were the one thing that didn't go down. On the other hand, silver was free to float, and after experiencing a rally during the first 1/3 of the bear market, it subsequently gave all the gains and fell below its lows during the disinflation of the 20's. Because gold is now free to float, Prechter believes that the silver scenario is likely. I have tremendous respect for him because he made the call when I was 99% convinced that gold was in a bull market (it need to break $340 in my eyes to make it official). This is why I didn't fully read his book until now. I was so convinced that he was wrong and a crackpot because of the way the gold stocks were moving - with so much volume. The way they broke down this week made me bown down to Prechter. I've always had respect for him, but I just couldn't believe he could put a target of 777 on the Dow. Now, even though I don't believe him, I have done what he says with my assets...just in case...because ANYTHING is possible after the biggest bullshit market of all time. So the answer to your question is: Because gold is an asset and its price is ultimately based on supply, demand, and liquidity, of which demand and liquidity are lost during Kondratieff Winter. Gold IS the best bet amongst all the asset classes (not including cash) at these levels, but that is only in a relative sense. In an absolute sense all assets will fall. Deflation sucks.