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To: Mike M2 who wrote (47985)7/29/2002 2:17:50 PM
From: whydididothat  Read Replies (1) | Respond to of 209892
 
Thanks for that article (thanks to Reaper too). I'll add this 1999 essay from the Hussman Strategic Growth Fund website: hussman.net

In essence, Dr. Hussman seems to be saying that inflation and US dollar depreciation both are bullish for gold (dollar depreciation being linked to drops in long term "real" interest rates where "real" interest rates = long term interest rates - long term inflation expectations). What's confusing about this is that we are talking about "inflation" rates RELATIVE to long term interest rates.

I suppose one can see by the formula that if long term interest rates are marginally higher than long term inflation expectations, the dollar will be weak and gold strong ... thus a case for low inflation, with low interest rates and rising gold prices. Sure wish Dr. Hussman would join the discussion now - maybe he could bail me out here -g.

Edit: Skimming thru Gibson's Paradox, I think the above may be a restatement of said paradox.