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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Bobby Yellin who wrote (10604)	4/26/1998 3:57:00 PM
From: ahhaha	Read Replies (1) \| Respond to of 116764

Layoffs are minor now. They get the headlines because the media loves the Yellow Dog. Prosperity is rising. The DOW advance must have some validity to it, so the perception of general rising wealth must be valid. Workers, union or not, are starting to resent the fact that they aren't getting their fair share. This psychology is inevitable with rising wealth. It doesn't take an avalanche of strikes and rising wage demands to get trouble to be capitalized. The worst of all worlds is the slow insidious incremental advance which is seen when companies initially quietly settle the strikes by conceding to wage demands exceeding their ability to afford. The companies presume prosperity will bail out their generosity, but these concessions bring about rising prices and therefore falling demand which slows revenues to pay wages. There is no stopping this process. No one will voluntarily concede some pay so fat cats can buy some more whores. Everyone quietly goes to war against everyone else. People don't cross picket lines because they think the results of the strike won't hurt them. Sympathy for the devil. They end up blaming government for failing to underwrite the wage demands and they blame corporations when general prices rise. It's always someone else's fault. The labor vs capital war is just beginning so you can't expect anything but skirmishes at first. The war would be a cold one and never be fought if the FED let the market determine the price of money. They do this more now than in the past, but it depends on the political economic philosophy of board members. After prolonged prosperity periods, discipline is often deemed not expedient as the members think they know all about how to make prosperity permanent. They err on the side of ease. You hear them talk a tough stance, but that's easy to do when things are humming right along. The degree of this "pretense to knowledge" is measured by the difference between the federal funds rate and the rate on long term treasury bonds. As long as this difference widens, gold will advance. Even if the difference didn't widen, the price of gold would rise to its structural equilibrium price which I guess is at $400/oz currently. The most intensely watched of all indicators by the FED is gold. None of them would admit that even to each other because intellectuals hate to admit that humanity is controlled by emotion far more than it is disciplined by thought. The universities still resent free market capitalism and all the simple truths that individuals know intuitively. The FED is a microcosm of the university view, but the centralized authority is dominated by individuals who really don't trust their colleague's theories. I guess each of them has sympathy for the devil too.