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

To: John McCarthy who wrote (21234)	9/17/2006 11:32:12 AM
From: maxncompany	Read Replies (1) \| Respond to of 78416

Growth in China for the last couple years has been said to being restrained by Chinese officials, but the growth maintains around 10% or so anyway. Reduced base metals prices is only good news, not bad for China, as they continue their fast paced growth. China is not above talking down metals prices, or even selectively timed dumping metal on the market to lower prices...............making the metals they need for their huge growth cheaper.

To: John McCarthy who wrote (21234)	9/17/2006 12:03:46 PM
From: The Vet	Read Replies (2) \| Respond to of 78416

John, I will comment on one point, that of jewelry demand. I don't believe that the trinket market is anywhere near as elastic or price sensitive in the longer term as is commonly believed. However it is "lumpy", which makes it very price sensitive in the short term. Manufacturers of trinkets need a constant supply which generally is increasing at a fairly steady rate. They can do far better by buying more than their immediate needs when the price is low and refraining from purchases when prices are high. Gold in their vaults is better than money in the bank especially if it was bought at lower than average prices. Their actual use doesn't change much; when prices are high they use metal from inventory bought at earlier lower prices. When prices drop they replenish that stock. However their inventory of raw metal is not unlimited and when it is exhausted they are then forced to buy even at higher prices. As a result, we see resistance to physical buying by manufacturers at high prices but that is quickly compensated by increased buying when the price drops. This effect is much greater with PMs than it is with most other commodities, simply because gold is both money and a raw material for jewelery manufacturers. It's also easy, not bulky and cheap to store especially for manufacturers who already have secure storage in place for their materials and products.

To: John McCarthy who wrote (21234)	9/17/2006 1:48:35 PM
From: bruno_1	Read Replies (1) \| Respond to of 78416

my answer is ALL OF THE ABOVE. If you look at charts of gold vs the dollar, oil vs the dollar, and the euro vs the dollar since the beginning of 2006, they are all mirror images. In other words, when the dollar has risen oil, gold and the euro have all fallen and vice versa. I don't think one of these causes the other to occur. These move relative to each other the way they do because of the net effect of all the things you have mentioned and a bunch of other things as well. So far I have not been able to figure out the relative importance of the various factors that move these markets (international tensions, supply and demand, interest rates etc etc). I can see that once a trend is established it tends to continue until it reaches support or resistance. Right now I think the euro, oil and gold will continue to decline at least until the dollar rally meets resistance around 87. what will cause it to reverse ? I wish I knew. But I am waiting to buy commodity related stocks until the dollar rally fizzles out.

To: John McCarthy who wrote (21234)	9/17/2006 2:23:39 PM
From: Claude Cormier	Read Replies (3) \| Respond to of 78416

The recent drop in the price of gold is only a short term affair. Nobody can be certain of the causes of short term movement in gold. But the odds are that the root cause of this recent drop is selling by European Central Banks.

To: John McCarthy who wrote (21234)	9/17/2006 2:46:02 PM
From: jackjc	Read Replies (3) \| Respond to of 78416

The PERCEPTION due to several of the above apply. But a primary reason is missing: The price of gold just got ramped above trend as often happens with any traded price. And is falling back as the usual response to this. And could well fall below trend for a time. If so, a subject for traders and not a concern of investors til they finally decide to plan their exit.