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

To: Crimson Ghost who wrote (13065)	6/13/1998 11:05:00 AM
From: Gabriela Neri	Respond to of 116790

George, Could not have said it any better than that. If we do get the selling climax towards 260-250 in POG, it will be cause for celebration, as it will mark a long term low in price. How fast it recovers is anybodys guess. It could be a slow winding path and it could also be a spike-a-roonie. Only time will tell, for that is difficult to determine.

To: Crimson Ghost who wrote (13065)	6/13/1998 11:23:00 AM
From: MUDMAN	Read Replies (2) \| Respond to of 116790

George: For all the chatter about the "flight to quality" to US TSY's the fact is that most of the buying has been in the long end of the yield curve. Traditionally, "flight to quality" is characterized by buying in the short end - ie: 5 years and in. I would argue what we have going on instead is a seismic shift in long term inflationary expectations rather than a "flight to quality". The yield curve has flattened dramatically since the previous low 30 year bond yield on Jan. 12, 1998 (also the low for gold). Where do we go from here? I believe we are near a final resolution of the Japan issue, and that we may get some surprise over the weekend, such as Hashimoto announcing new individual tax cuts. With a GM strike going on, the coming explosion of the US trade deficit will be a potential political pipe bomb. Clinton, Rubin et. al. have a vested interest in a strong dollar, but not an overvalued dollar. In other words, I would not want to be long US TSY bonds over this weekend. Regarding gold: the POG has had a strong inverse correlation with the 30 year TSY yield. I believe POG has actually held up well considering all the bad news: Euro CB selling, 15% gold EMU, weak Asia demand, strong $$$. The killer question is what the Euro gov'ts will do with the excess. I believe it would be helpful for Bill Murphy if he can to give us some insight on this issue: who holds what tonnage, etc... I believe Germany, France and Italy hold the majority of Euro gold and each has stated they will not be sellers. Perhaps this is an overlooked point. In sum, the gold, US $$/Japan Yen, US bond and equity markets have been one way bets over the past year. As usual, there is always some exogenous or unseen event that causes these markets to gain much needed fear. I believe we are close to that point. When it becomes in all the politician's interests to change the direction of events, that is when the change will happen. I believe Clinton, Rubin and Hashimoto are close to a convergence in their interests. As always, time will tell. Mudman