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Strategies & Market Trends : Precious Metals mutual funds (gold, silver, PGMs) -- Ignore unavailable to you. Want to Upgrade?

To: Larry S. who wrote (299)	3/4/1999 8:08:00 AM
From: Richard Mazzarella	Read Replies (1) \| Respond to of 972

Larry, <<computer models think/learn (use artificial intelligence>> That's what I did for a living just before retirement, even have a couple of neural network patents. Neural networks can learn patterns if present that would be very difficult for humans to perceive. If there isn't correlation, even looking multidimensionally, the process is random and can't be forecast. Unless people are inspired by the Holy Spirit with new insight and discovery, the machines can always do a better job finding patterns. I think that the real problem for gold is that it has lost its monetary significance. Of course it could retain that position with enough failures in paper promises, but I don't see that soon. I suspect that all we have in gold is a commodity priced by supply and demand.

To: Larry S. who wrote (299)	3/4/1999 3:23:00 PM
From: Zardoz	Read Replies (2) \| Respond to of 972

Nice posting. "The most important area where we seem to see things differently is in the impact of forward selling or hedging by mining companies. Searle Sennett posted a response to Murphy today on the Dutch Bank thread with an argument that forward sales are bullish. I had argued that they are neutral but I think our difference is more semantics than real." Actually the forward sales of gold is very bullish: Since some people who are bullish on gold, may seek to purchase options, futures, or future options in gold. This pushes LEVERAGED risk capital into the gold markets, and creates a base for the bottom of gold. And in times when the price of gold starts to climb, the equity and technical vacuum sucks the price up faster then in times of stability. But in times of low currency and commodity volatility the leverage divergence between the longs, and shorts create a market of extreme stable price. This is where the producers will attempt to add volatility by buying the spot, and writing the futures. This is evident by the spread between futures and spot closing gap. This is when the XAU and spot gold diverge in trends, and when the XAU ratio decreases. goldsheet.simplenet.com As Searle Sennett said also on the Dutch thread #reply-8142997 : "Just wanted to mention, however, that, on my own analyses which compare the POG to the value of a bunch of currencies using data going back to 1982, gold is NOT cheap." If gold is truly a currency and/or commodity then both of those two elements can be factored out of the equation, and a trend {even fixed currency price} can be created where the two trends can be forward assumed. And even in times of economic instability, you can consider these prices to only trade at a small premium to the fixed exchange rates. This was very evident in August when the POG was actually collapsing; which adds to the support of the conclusion that the POG is being manipulated higher, and not held down. Because during that time the US dollar index was already collapsing from the 100+ range decisionpoint.com which should've meant that the POG {priced in USD terms} should be rising. But both the XAU and gold weren't: decisionpoint.com decisionpoint.com for a better gold chart: pacific.commerce.ubc.ca Naturally GATA suggests that it was due to European, or USA CB selling. But if you look at the future, and options for that time period, you'd see that the volume of sales were lower then normal. This is why I have a problem with GATA, they refuse to show any reasons as to why they believe what they do. They lack evidence of uncovered shorts, and refuse to acknowledge how the futures market, CB leasing, and GOLD works in general. They are attempting to go on a witch hunt without evidence. Now that open interests have picked up in gold April sales, we have seen a basis. But this base is at a large premium to what GOLD as a currency should be. This is why Searle Sennett is predicting a lower POG just do to currencies.... BUT if you add in lower commodities prices, such as oil, then your real price may well be $250/Oz. So why is gold staying up in price? Well as a person who also looks at currencies to predict GOLD, I also look at economics. And what is adding extra support to gold is deflation. Gold ALWAYS does best in times of deflation {not inflation} Yes, we all have heard of times when gold rises with the interest rates... but that is interest rate deflation and is reflected in the disparity between rates trying to equalize with already higher inflation. So in USA the price of gold should already be falling.... but it isn't, only the volume and open interest have been rising on gold. So the deflation that should be of concerned is the deflation in Japan, and Europe. When Europe formed their zolverene, they based it on diverse economics that CAN'T work at the level the currency is at. As a doomed economy to deflation, the currency was both 'I' overvalued, and 'II' lacks the political and fiscal policies to sustain it. So until the union acts together to print money, and spend, they will deflate. Add to that Britain is in a recession {largest buyer/seller of gold is the British Gov.}. Also the resurgence of Japan is FAR from occurring. So what you actually have is world deflation, USA inflation, and a 30 yr bond that will/has started to attract large foreign cash inflows. And one need only look at the USD index to see this occurring. charts.quotewatch.com This is why, beyond a full fledge currency crash that the pog should decrease, once the Euro, YEN, pound stabilize. Look out below. PS:"I should have been referencing post 10, not 9. It may be that there are only 5 or 6 people following this thread and this could explain why there have been so few responses to my post concerning the surplus that isn't" Nahhh we realized that many lurkers read here, and when they couldn't find the data.... looked at the post before, and after. [8?) Happy trading.