To: sea_urchin who wrote (2384 ) 11/29/1998 10:01:00 AM From: Zeev Hed Respond to
Searle, I think that the great majority of this bull move is probably over, the way I see it there are going to be major "cross currents" next year, including the Y2K problems, the far east struggle to regain economic and political stability, the transition to the EURO (that is going to cut a percent or two in Europe's economic growth, IMHO). I agree with Hyman that the long bond will tend down, but I do not expect this to translate to particularly strong equity markets short term (3 months), longer term, toward the second half of next year, we will probably have another attack on 10 K in the Dow. Generally, however, I still stick to a 5 to seven years (starting with this as the first year in this "cycle") trading range in the 5000 to 10000 on the Dow with high volatility. As for Gold, with three emerging international currencies, the dollar, the EU and the Yen (probably to be replaced some time in the future with an Asian currency?), the role of monetary gold will subside even more and CB will gradually replace whatever gold they have with a basket of these three currencies. With, I believe, about 8 to 10 years gold production in the CB vaults, there is ample overhead supply there to compensate for the miniscule 5 tonnes reduction in Australian output and even the decline of 200 tonnes over the last two years in SA output. For next year, I see a tight trading range of 285 to 305 for the spot, with some possible spikes below early in the year, and a mild spike above 305 later next year. If all the body blows to various currencies last year could not create a "flight to gold", I just do not see what will.
