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Gold/Mining/Energy : Gold & Gold Stock Analysis -- Ignore unavailable to you. Want to Upgrade?

To: kayco who wrote (16832)	12/28/2008 4:27:12 PM
From: prometheus1976	Respond to of 29622

o k ..in the 1930's depression,gold and the dollar were pegged. the price contractions were expressed as a stronger dollar,but was it a stronger dollar or stronger gold?...a moot point since they were correlated. This time gold and the dollar are not pegged,so we shall see which is the better store of capital. it may be that,just as an example, goods and services in the aggregate go up 40% ,and gold goes up 80%.Goods and services would have decreased/deflated against gold and increased/inflated against the dollar.It really just depends on the denominator you use for value,and the time frame you select. Personally,my theme since 2001 has been "where do you go from the dollar?".The earlier collapse of the ruble,baht,real,and other currencies lead most of the world to the U S dollar.As the dollar becomes suspect,i believe that some will mineralize a portion of their savings. Note the difference between "saving" and "investment".. My theory is that savings in gold will be held and passed on to heirs,and that currencies will be spent as need be.The amount of actual gold that changes hands should decline sharply..Gresham's Law. Just my thoughts,fwiw. Also,due to the extremely small amount of gold available,a little demand will translate into much higher prices. All of the above is the basic goldbug mantra. regards,P1976 PS..look at the Dow/gold ratio for the past 7,25,and 50 years.