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Politics : Dutch Central Bank Sale Announcement Imminent? -- Ignore unavailable to you. Want to Upgrade?

To: Ahda who wrote (19055)	9/19/2003 3:40:11 PM
From: sea_urchin	Read Replies (1) \| Respond to of 81205

Darleen > i am in deep thought the gold market is moving today and my concern is of currency. These are my thoughts which I have just sent to someone else in an email so I repeat them here. "I can see they are trying to push the gold price up but, nevertheless, it seems to be having a hell of a job getting above $385 and staying there. Or so it seems. Anyway, I am quite prejudiced about the present "bull market" in gold. Reasons are 1. Unlike the big market of the 1970s, no-one is buying bullion this time, least of all for investment purposes. And that includes gold coins. In fact, the higher prices have caused a fall-off in bullion purchases. The whole run has been done with "paper gold" --- derivatives and futures --- and, of course, bullshit about the end of the world. 2. The open long position is enormous by historical standards with the bulls being the speculators and the bears (sellers) being the industry. 3. My own analysis of the gold price, in all currencies, and gold share prices, using data since 1978, shows that present values are "through the roof". In fact, this is the fourth time in the past year they have reached these levels (before falling back on the 3 previous times). I do recognise, nevertheless, that on a relative strength basis, gold shares, in the US, are stronger than most others and so that would be attractive if someone wanted to ride on the trend. Here, of course, with the shit with the rand, gold shares haven't performed nearly as well. Nevertheless, as happens in such markets, the shares in those companies mining the least gold are invariably the strongest and attract the most ardent and vociferous "believers in the gold price". This is a site that gives a good picture --- as I see it. But maybe a bit too bearish for most." technicalindicators.com > The US has imprinted her footsteps and fiat all over the world. It all comes back here and we are not booming if you carefully look at all the information and avoid the medis interpretation our figures leave much to be desired. I think the simple truth is that the US has been living beyond its means and has been disguising that truth with smoke and mirrors. > China there of could be at risk. Reason being if she unpegs her currency will rise and that will reduce the actual dollars she holds in the US but decrease her ability to compete on the world market. All foreign exporters to, and investors in, the US are trapped in the same bind. The longer they remain so the harder it will be to escape and the more painful it will be. > I am thinking that Japan sold the Yen bought US dollars to keep the Yen low and could very well use those US dollars to build in China she there of does not need to hold US dollars Yes, Japan sells Yen and buys USD and she also, like the US, invests in China. Everyone has learned the "Argentine trick" --- keep your currency high and do no work. And when the proverbial hits the fan you blame the IMF. > Same problem as the Rand and the additional cost of gold production Sure. Only problem here is that they can then close down the gold mines --- and everything else. Our "experts" are trying the strong currency trick by keeping up interest rates so they are higher than anywhere else in the world. So instead of receiving taxes from local businesses our fiscus can sell Treasuries to foreigners. And then redeem them one day --- but they don't think of that. Unfortunately, the SA gov has such an inferiority complex about a weak rand and maintains that whites think it's because blacks don't deserve better. So they are determined, come hell or high water, to keep the currency strong. In fact, they say that anyone who recommends that the rand should be weaker is an anti-black racist. Believe it or not. > More problem for the US as the dollars return and are met with limited investment value Yes, I think it now takes about $4-5 to create $1 of return. > China growth rate has been furious if it continues China could end holding far too many US dollars. Then we are all at risk. We all are, anyway!

To: Ahda who wrote (19055)	9/19/2003 7:51:11 PM
From: sea_urchin	Read Replies (3) \| Respond to of 81205

Darleen > i am in deep thought the gold market is moving today and my concern is of currency. (2) How's this for a reason? guardian.co.uk >>>The International Monetary Fund yesterday warned that the colossal United States trade deficit was a noose around the neck of the economy, emphasising that the once mighty dollar could collapse at any moment. Arguing that the world's big economies were already too dependent on the willingness of American consumers to live beyond their means, the IMF said the US could not continue to run a current account deficit of 5% of GDP. The IMF's chief economist Kenneth Rogoff said that it was just a matter of time before the gap closed, tipping the dollar into a potentially steep fall. <<< But then we read this: >>>Following an upgrading of its growth prospects by the fund, the US is expected to expand by 2.6% this year, the fastest of the big seven economies.<<< The contradiction doesn't make sense, in fact, the US economy is the best of the seven biggest economies. Anyway, the message will certainly not do gold any harm. PS. Maybe Rogoff is a goldbug!