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

To: koan who wrote (14439)	6/25/2006 10:16:42 PM
From: John McCarthy	Read Replies (1) \| Respond to of 78416

koan if you don't mind wanna throw one at you that you won't buy into ... but its stuck in my brain before we begin - I am a die-hard: gold is currency and the dollar ain't - period. nonetheless .... suppose we (USA) gets into a recession ... no need to debate - we will know within 12 months .... and just suppose this jitters the rest of the global financial community because they fear for the economies of China and who ever else you want to add .... now in this (imaginary) scenario: Where does the FOREIGN investment go? Do investment flows go to China? Or Japan? or you_name_it My dumb ass brain is telling me that foreign investment would RUN HERE - to US Treasuries - and sort of hang out in them until things cleared up. What would that do - in the FACE OF YOUR TRILLION DOLLAR DEFICIT - it counter intuitively RAISES the value of the dollar .... because these foreign investors are trying to PARK their investment dollars till things blow over ..... and fighting for a parking place - hence LOWER interest rates the Tresury would have to pay out Note: Our deficit situation has not changed nor the trillions of USA dollars in foreign central banks. I much prefer to think .... Those foreign investment flows would run to gold ... But I am not aware of a test-tube experiment to try this out on .... or read about from the past. Please note - (can't prove it with a link) but gold went UP in the depression. (From bad memory think that was in the Turk Barron $8000 gold article - or - from some article around that time) regards, John