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

To: mcg404 who wrote (19455)	10/26/2003 8:31:00 AM
From: sea_urchin	Read Replies (1) \| Respond to of 82047

John > When we say strong are we not saying 'with respect to the USD'? Yes, mainly, but also against other currencies. Here's a chart of ZAR v Euro which chows that the rand is even strong against a currency which is strong against the USD. So the rand is "doubly strong" (of course, only since beginning 2002). multichart.de > if we add 2 qualifiers: 'in the long term' and 'in a stable monetary, currency situation' Of course, but I refuse to be a trader simply because everyone else is doing it. Reasons are 1. I'm not good at it --- when I get excited the party is usually over 2. Any profit one makes is fully taxable and, indeed, having taxable profits in one's portfolio leads to the idea that all profits should be, even longer term ones. 3. If one mistimes the market short-term, having the safety net of a "good" company with a good profit history gives one some insurance for recovery > Merely following the currrent, speculative price inflation of the general markets? Or beginning to reflect its true value relative to all those new USDs. I can't answer that. But remember, those "new USDs" are being created all the time and, in fact, the rate looks like it has fallen a bit compared to pre-2002. If you are looking at money-supply, however, then you are talking inflation and, in fact, inflation, as judged by the CRB Index of commodity prices, has been pretty steady for many years. (The chart does show that it is up at the moment compared with 2001-2 and 1999, but those were very low years.) stockcharts.com[w,a]dallynay[dm][pd200,2] Here's a chart comparing CRB to POG stockcharts.com[w,a]dallynay[dm][pd200,2] This chart demonstrates clearly and unambiguously that gold has "no life apart from its being a commodity" (or maybe a USD hedge) because the ratio of the gold price to the commodity price index is virtually range-bound (around 1.5-1.6) and with very little volatility. So, unless one anticipates a period of massive inflation, like occurred in the late 1970s and which seems most unlikely at the moment, the gold price looks like it must be near the top of its range. For completeness, here's a chart of POG v Oil price which shows a similar, range-bound picture at the moment. stockcharts.com[w,a]dalaynay[dj][pd200,2][ilb14!la12,26,9]