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Strategies & Market Trends : Strictly: Drilling II -- Ignore unavailable to you. Want to Upgrade?

To: terry richardson who wrote (16898)	8/8/2002 8:58:45 AM
From: terry richardson	Respond to of 36161

A long read from PrudentBear.com but worth it for Gold Bugs. States the case for gold well and points forward to a gradually rising price. "...Next, Cooper and Hira turn their attention to gold; and, one by one, they "vote off" those factors which had contributed to the metal’s long bear market. Much of this, I have already addressed, so I wont repeat it all here. In the end, as you may have already guessed, these folks predicted that this game of Survivor would ultimately see gold as the last man on the island..." "..A number of supply-side and libertarian-oriented economists and pundits have been loudly castigating ongoing Fed monetary policy; and they have been specifically pointing to the still-low (in their view) price of gold as "proof" that the Fed remains too restrictive of the money supply. Men such as the previously-mentioned Kudlow, publisher Steve Forbes, politician Jack Kemp and others are universally beating Greenspan over the head with his own previous pronouncements that a $340 per ounce level for gold was the desired "equilibrium." Such a level, the central banker said a few years back, indicated the proper balance between inflationary and deflationary fears...." "....Further, if we adjust Greenspan’s target gold price of several years ago for "inflation" (and I can’t help but do so) shouldn’t we now see an equilibrium price of $360-380 per ounce? Perhaps. The question is whether or not the Fed can allow it. A corollary question is whether--in the end--the Fed can prevent it....." "... I believe that the Fed has been "bleeding" large amounts of gold into the market, so that some of these players can steadily cover their short positions. At some point, of course, these loans will also have to be repaid; but the Fed (and any other central banks involved) will, I guarantee you, be very patient creditors. The motive, of course, is to get as many of these institutions as possible out of harm’s way in the event that gold rises far more, and in such a way that the bankers are unable to do anything more than slow it down...." 64.29.208.119