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

To: jjkirk who wrote (3579)	7/31/2002 1:52:24 PM
From: Jim Willie CB	Respond to of 89467

faulty consensus opinion has gold no good during deflation so if GDP revision is downward then maybe deflation is worsening I always bear in mind that the gold mindset among Americans was very clearly conditioned in the 1970 decade that was an inflation decade they must slowly realize that gold thrives also in a deflation environment apart from intl tensions, the first leg for gold imho was due to two things 1. Fed unprecedented money supply infusions (monetary inflation) the Fed increased MZM by 40% since Jan 2001 !!! this usually signals price inflation within two years 2. Real Rate of Return on 3-month TBill is now near zero historically this has been the early signal for gold gold sector did well in last half of 2001 and early 2002 but now it must find more reasons as we come to conclude the recovery is stalled permanently, my guess is gold will be seen as the answer, for the same #2 reason the Real Rate of Return on shorterm Trez is still zero see Japan for proof that gold thrives in deflation envmt gold had no conviction in the last couple days can you believe the Goldman Sachs gold reco ??? this is the wolf recommending chicken / jim