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Strategies & Market Trends : YEEHAW CANDIDATES -- Ignore unavailable to you. Want to Upgrade?

To: LAWRENCE C. who wrote (4295)	1/17/2004 9:08:00 PM
From: LAWRENCE C.	Read Replies (1) \| Respond to of 23958

The trade deficit was smaller due to a weaker dollar. Conversely if the dollar gets strong the trade deficit is likely to get wider again. The US government will monetarize the growing federal deficits. There is the immediate increasing of the money supply to accomodate this. The supply of dollars (even M1, much less M3) far exceeds the supply of all gold ever mined and is increasing faster than the supply of all gold ever mined. The US and state government deficits take available credit away from the private sector and have the effect of raising rates for private sector borrowing as well. When US treasury rates climb, the interest on the deficits is going to hurt. Some Asian central banks (China and Vietnam in particular and probably others)are buying gold for currency reserves. The fundamentals of the dollar still remain weak which is still bullish long term for gold and precious metals.