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Gold/Mining/Energy : Epic EAS.v (formerly Epic ERB.v and Safari SIR.v) -- Ignore unavailable to you. Want to Upgrade?

To: CLK who wrote (1592)	3/5/1998 1:26:00 PM
From: Henry Volquardsen	Read Replies (3) \| Respond to of 3335

*OFF TOPIC to CLK* I have seen comments from Trichet to that effect in the past. It is worth noting that the French have a very long track record for being pro gold. In all the speculation about European central banks selling gold to dress up balance sheets, France has been the only country that no one suspected would sell gold. Also remember it was DeGaulle taking delivery of gold from the US that origionally forced us to abandon the gold backing of the dollar. So these comments re gold are very much in keeping with traditional French views. That said the scuttlebutt in Europe for some time is definetly out of favor with the French gov't who would like to be rid of him. They don't want him involved with the European Central Bank which is why they have been pushing him for the EBRD. It is the northern Europeans who want him since they realize that at some point they will need a Frenchman in the job and Trichet is just about the only French central banker with strong anti inflation credentials. Yes the French and Germans will have strong influence over the Euro but that does not in itself insure a strong currency. Also having large gold reserves is considerably different from being pegged to gold. Both France and Italy had huge gold reserves throughout the 60s 70s and early 80s when their currencies were going down faster than a White House intern. I strongly believe that the policy emphasis in Europe post Euro creation will be very strongly focused on job creation. Given Asia and the generally low level of global inflation they are not worried about imported inflation. As a consequence i belive currency defense will not be a prime focus and in fact they will be quite prepared to accept moderate Euro weakness as part of a trade off for job creation. I strongly believe the Euro will not be a strong currency, the only question is whether it will be a weak currency. Henry