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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers -- Ignore unavailable to you. Want to Upgrade?

To: SouthFloridaGuy who wrote (1938)	11/16/2005 9:36:02 PM
From: koan	Respond to of 78418

I keep hearing stagflation. What I have read is that the money inflation necessitated by the Vietnam war ("Johnson's guns and butter") which many believe produced the 1979/80 inflation/stagflation and $850 gold and 52 dollar silver is now FOUR times worse. Certainly the debt to GDP is at historical highs (almost 6/7%?-5% is considered critical) with no light at the end of the tunnel; and Volker says we are producing 6% less than we are consuming which cannot last. And the bush administration is now so desparate for cash (hurricanes, two wars, high oil, etc) because they cut the taxes on the rich and corporations so much, now they are trying to make up the lost revenue by cutting school lunch programs and student loans-lol. Not sure if that will do the job, forgetting the ethics for a minute-lol. But gold has been also following oil, )like in the old days-lol). Well, in any event it is certainly interesting. I am betting on staglflation myself and a long drawn out debasement of the dollar.

To: SouthFloridaGuy who wrote (1938)	11/16/2005 9:54:21 PM
From: chip	Read Replies (1) \| Respond to of 78418

I've also kept this Adam Hamilton article in mind lately: safehaven.com

To: SouthFloridaGuy who wrote (1938)	11/16/2005 10:09:14 PM
From: loantech	Respond to of 78418

Dunno but keep it up. <g> Go gold go dollar. I am so glad koan is back a breath of fresh air. Hey koan you shower <g> you way way up north on an island. <g>

To: SouthFloridaGuy who wrote (1938)	11/16/2005 10:26:30 PM
From: kacy_in_LA	Read Replies (1) \| Respond to of 78418

My short answer is to your conundrum is that expected inflation is exceeding the short-term interest rate cost of carry by an amount that exceeds the strength in the US dollar. In other words, the dollar is strengthening because there is the expectation of continued economic growth and profits (and hence fed "measured pace" tightening relative to the other CBs), but the rise in short-term interest rates are not expected to keep pace with inflation at this time. Its a variation on the "Fed is behind the curve" argument.