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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: TH who wrote (12625)	10/8/2008 8:37:42 AM
From: Real Man	1 Recommendation Read Replies (1) \| Respond to of 71456

Who knows. This global rate cut thing is extremely bullish for gold and silver. Gold is a small market. So, One side of the story: It gets whacked easily, the most manipulated market on the planet. Why? Cause. Central Banks are the biggest investors, and they are not interested in gold spike. The other side of the gold/silver story: What if a lot of funds decide to park a tiny bit there, just in case? Say, only 1% of their assets? Supply < 3000 tons/year That's worth just $90 billion. The size of all other markets is 1000-s times larger. 1% would make 900 billion, gold price will have to rise 10 fold to accomodate such asset allocation. Are central banks willing to part with their gold? Now? Which side of the story will gold play? Needless to say, if they whack gold and silver, lots of miners will go bankrupt, and that will reduce mining supply further. It has been falling since Y2K. They sure suppressed Au/Ag, all the time. How else can one explain Au=1000 with Oil = 150 and falling XAU/Gold ratio? IMF dump this Spring? Sure. Not manipulation. Greenspan used that trick repeatedly in the 90-s. Did you know ALL FED gold on the balance sheet is called "gold certificates"? Yeah, most of it gone. Another question: Are all central banks interested in further gold/oil dump? There could be buyers for that gold put on the market, if the Western banks would REALLY want to part with it now.