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Politics : WAR on Terror. Will it engulf the Entire Middle East? -- Ignore unavailable to you. Want to Upgrade?

To: Scoobah who wrote (13153)	3/3/2006 12:59:29 PM
From: Hawkmoon	Read Replies (2) \| Respond to of 32591

it has me long gold and silver stocks as I see the US market teetering Ever thought that maybe, just maybe, that the growing electronics industry, and it gluttonous use of gold in its circuits, might be placing excessive demand on gold prices? It's like the price of Platinum, which has been receive the benefit of being used in catalytic converters. Can you imagine what would happen if there were sudden increase in demand for dollars because it became fashionable for everyone to wallpaper their bathrooms with greenbacks, but the Fed didn't have the capability to print sufficient supply? The USD would soar in value. What you should watch is the international demand for our T-bills. Since the Fed primarily controls monetary supply through market activities in T-Bills, it's an indicator whether an inflationary money stance is being pursued. And that's not quite evident to any extreme degree right now. If anything, we have an inverted yield curve, where short term debt is yielding more than longer term T-Bills. That suggests that there is insuffcient liquidity in the longer term notes. Also, since the US only recently started re-issuing 30 years bonds, the demand has been high as institutions probably start swapping into them from mortgage backed securities (where an overabundance of such are the real threat, in my opinion) Hawk