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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: loantech who wrote (134)	7/4/2003 10:51:44 PM
From: russwinter	Respond to of 110194

Fair question, I definitely feel one should own a chunk of gold and/or selective gold shares as it is likely to benefit from USD turmoil, and the general equity and credit market exodus I forsee. However, I keep asking myself why POG is only $350, a full month after 1. China has opened purchases for citizens, and with a new listed trading vehicle on the way in the US. 2. with interest rates being nominal (almost completely eliminating the contango and incentive for hedging) which puts gold (nobody's liability) in an extremely competitive position relative to any paper debt instrument. What happens to gold if interest rates head higher as I expect? Did you know YTD POG is up maybe 1%, and the Canuck Loonie is up 18%? I'm not complaining, but isn't it disconcerting that (for Americans)our primary benefit to holding Canadian PM companies has been the currency, not gold prices. Maybe it is mostly related to the bogus deflation talk making the financial rounds? If so, this will be debunked and gold will get airborne? Still much about gold's performance doesn't make much sense, and I would not be making 100% bets on it. As you know I've been more friendly towards energy, and last week I even purchased some corn futures. My short positions have moved from 5% in April, to about 30% now. I'm about 35% energy, 30% short, 30% precious metals (including PGMs and silver), and 5% special situation long.