All times are U.S. Mountain Time
(Yesterday's Discussion.)
Goldilox (2/22/04; 23:07:07MT - usagold.com msg#: 117535)
currency/gold tie
@ $ Bill
"The danger in adopting a currency linked to gold is that it opens its exchange rates to the vagaries of fluctuations in the price of gold on the international market. In addition, given the limited supply of gold in the world markets, manipulative or speculative forces may upset the price equilibrium to the disadvantage of Gold Dinar."
Is this really that different from the market battles we see today between $ and gold? The manipulation couldn't increase, but it also might not decrease.
Goldilox (2/22/04; 23:00:10MT - usagold.com msg#: 117534)
Taylor on the markets and gold
Jay Taylor at the Eagle
snippet:
"Unfortunately, I was unable to find an article I had read this past week that noted how much more rapidly debt was rising than income. There were a number of statistics that caused this concept to become much more real than the macro level discussion I normally apply when I talk of rapidly rising debt. I recall that one of the stats in this article noted that personal income grew last year by 2% while consumer debt grew by 10%. The article also noted that while our savings rate was somewhere around 1.5%, it is in fact negative because government statisticians impute a value from housing into the savings number. Funny how government omits housing from the CPI and then includes it in the savings numbers, but that gives you an idea about how deceptive our government is. The point is, we-both as a country and as individuals-are running ourselves into bankruptcy. As we spend more than we earn, our individual balance sheets as well as the collective balance sheet of our nation are becoming weaker and weaker. Unfortunately, it is only a matter of time before this house of cards comes tumbling down and America becomes an impoverished nation. In that condition, how will we avoid being dominated by other nations? How can we hope to maintain the freedoms we have come to think are our birthright?"
Goldilox:
I agree with Jay. We get so distracted by all the political sideshows and market manipulations, we tend to forget the main event. Sort of like our tendency to treat symptoms ahead of disease. Debtberg ahead! That is what will finally sink the ship, and the aftermath of debt failure is likely the most important series of events to follow. Massive compounding debt - silent but deadly.
Dollar Bill (2/22/04; 22:59:09MT - usagold.com msg#: 117533)
.,.
Sir Steady, your link provided this also. A knot to untie. Beyond me! "The concept is similar to the launch of Islamic Dinar, except that the latter de-links its value to a commodity (like gold). Islamic Dinar follows the principle of its value linking initially with a basket of international currencies and later, transforming into a free-floating currency where its value would be determined exclusively by the economic fundamentals of its member states.
The danger in adopting a currency linked to gold is that it opens its exchange rates to the vagaries of fluctuations in the price of gold on the international market. In addition, given the limited supply of gold in the world markets, manipulative or speculative forces may upset the price equilibrium to the disadvantage of Gold Dinar.
Dollar Bill (2/22/04; 22:41:32MT - usagold.com msg#: 117532)
.,.
Sundeck, here is Chen on one possible one.
".......Under the simpler plan which requires "Japanese" Government to continuously buy up real assets of "USA" in stead of receiving debt instruments, the plan can go to the point when "Japanese" Government holds every bit of real asset of "USA". Then the plan must terminate and the situation goes back to the original "steady state". However, in the scheme of issuance of debt instruments by "USA" Government, even when the total amount of debt instruments in the hands of "Japanese" Government becomes equal to the total value of real assets of "USA", "Japanese" Government can use creative accounting to book the newly issued debt instruments, which in reality do not have any intrinsic value any more, as still equivalent to gold and make the wealth of "Japan" appear to continue to grow. If "Japanese" citizens let their mercantilist government get away with this kind of deception, then this foolish scheme of the mercantilist "Japanese" Government can go on indefinetely to the joy of "USA" consumers."
Beyond me, but at least there is one guy looking at the Japanese actions from a long term future perspective. To be Japanese must include some Island mentality and fear of limits. They probably are the 51'st state otherwise how could greenspan keep pushing the global route and keep saying we should not go protectionistic. Japan must be on board totally. The price for the US for going for the global economy must be the gradual loss of more and more of lassae faire and more and more increase of govt command economy.
The goverments are headed that way, the people cant see it, the media is behind it, or at least we cant count on them to oppose it, al kida actually doesnt even know what they are doing, or what will result from destruction, but none the less, the course wont change because of them.
I am guessing that it is the wave of the future, the human beehive.
When push comes to shove, the global corporations money will buy off the politicians and the nickels and dimes and screams of the US workers will only get pandered to. We are perhaps one major breakthrough in fuel cell tech away from changing the dynamics of the oil game.
Hard to guess what god wants. Surely he must have an opinion on the global direction. And what about that devil "murphy"? As in Murphys Laws. Obstacles are already in the way of the global economy global govt boys, will the obstacles get too big to overcome? What would they be?
The french idea of multi polar seems unrealistic. What, clump continents into camps like a Risk game where protectionistic trade barriers become infinitely complex?
How does multipolar add up when you are talking about alkida? Freinds of alkida vs enemies of alkida? How do you buy off alkida? Do the french really want an arab unity clumping? They added what? 25 countries to the EU, but will not allow Turkey. On one hand, and I dont want to talk myself into this, but haveing democracies in the arab states where they join in the global one economy seems preferrable to an arab central bank of oil. Tough road to walk, lots of negatives in the global economy...even more negatives in a multipolar....how does this overpopulating mess resolve? To lose financial soverignty is to lose govt sovereinty actually, by the looks of it, the G7 is on board the global economy/global govt express, and ultimately only one currency will survive. Tied in a controlled knot.
Just guessing.
If I was playing this all as a risk game, I would play the Avian Bird Flu card. Depopulate the humans in a quick and mostly meciful way. Because if it was my planet, I would say it is time for the plants and animals to get some more breathing room. And get the humans back on a local economy in a major way. But, that is just me.
Goldilox (2/22/04; 22:19:04MT - usagold.com msg#: 117531)
It's time to know your gold
http://www.gulfnews.com/Articles/news.asp?ArticleID=111686
snippet:
'Passersby stop to view the gold on display in a shop window. ©Gulf News
People will have more confidence in buying gold here after the municipality inaugurates its new gold assay laboratory.
The facility has been built in Sharjah Municipality's technical test complex, and is due to start operating shortly, enabling the public to get their gold tested.
Many customers said since they do not know much about gold, they have to trust the word of salesmen at gold shops. But they will now have the opportunity to have it tested, especially if they buy jewellery worth thousands of dirhams.
Faiz Alam, a Pakistani businessman, said: "People are sometimes in doubt whether the gold they are buying is genuine. Prices also vary from one shop to another. For example, a few years ago, a shop was selling one gram of 24 carat gold for Dh46.50, while another was charging Dh45. This also makes people suspicious. The laboratory will put doubts to rest."
He said if he buys gold from a small outlet, he will get it tested. "Setting up the laboratory at the Gold Centre is a good idea because outlets will strictly follow standards even if customers do not intend to get the gold tested."'
Goldilox:
The citizens of Dubai are serious enough about gold to build a new sophisticated testing lab. More public demand?
Sundeck (2/22/04; 22:00:03MT - usagold.com msg#: 117530)
Gold's rise in fiat currencies
Gold has been rising more-or-less steadily in all fiat currencies (like it has been doing in the US-dollar) for several years now. In most currencies, the upward movement has a relentless look about it.
However, there are a few currencies in which gold has shown reversals over the last year or two. The most pronounced of these have been the South African Rand (since about Feb 02), the Ozzie (since about Jan 03), Chilean Pesos (since about Jan 03) and the Kiwi (since about Feb 02).
In several other currencies, gold has gone more-or-less horizontally over the last year or so (Canadian Dollar, Brazilian Real, Icelandic Krona, Swedish Krona and, of course, the Euro). In some of these, an initial reversal seems to have lapsed back into an upward trend.
Why have these several currencies strengthened, or at least, held their own against gold in recent years?
Perhaps it is not a coincidence that five of them (South Africa, Australia, Canada, Brazil and Chile) are major gold producers (as well as other mineral commodities)?? They also have relatively stable political regimes and economies and quite high interest-rate differentials compared with the US, making them attractive in the currency carry trade.
Thoughts?
:-)
Sundeck
Sundeck (2/22/04; 20:46:17MT - usagold.com msg#: 117529)
Recent weakening of the Yen versus US-dollar
I am curious about the sudden weakening of the Yen.
Over the last four or five days it has dropped from about 105 to about 109 to the dollar - back to where it was about three months ago; all in the space of a few days.
Was there an exceptional bout of Yen-selling by the Japanese central bank?
Their much-publicised Yen-selling and dollar-buying during January did not succeed in altering the steady strengthening of the Yen that has been occuring for many months now. What was different this time? Have other traders decided to enter the market and short the Yen? (A dangerous strategy to my mind.)
Coupled with the fall in the Yen, gold also has fallen back to where it was about three months ago. Interestingly, 'though, the USDX is still significantly lower than it was three months ago. Hence the monetary intervention (selling Yen and selling gold and buying dollars) has not halted the more general steady decline in the dollar against the other currencies in the USDX (UK Pound, Canadian Dollar, Euro, Swiss Franc and Swedish Krona).
Of course, one relatively recent geopolitical change has been the modest (but nationally controversial) commitment of Japanese forces to Iraq. This was followed by an upgraded terrorist threat assessment within Japan (are the two events connected??). Also, the question arises of the effect on the Yen if Japanese forces start taking "hits" in Iraq. I would expect there to be a public backlash at home.
Just thinking out loud...perhaps others have some light to throw on the moves in the Yen???
I would be surprised if there are not a whole lot of written and unwritten, but never publicly-spoken-about, "arrangements" playing out between Japan and the US.
:-)
Sundeck
Dollar Bill (2/22/04; 20:31:09MT - usagold.com msg#: 117528)
.,.
http://www.forcastglobaleconomy.com/p3/article03.html
Chen on the euro.
steady (2/22/04; 19:45:15MT - usagold.com msg#: 117527)
beyond a trail ballon, an explanation of future events
http://www.gulfnews.com/Articles/news.asp?ArticleID=111719
Time ripe for introduction of new currency in Islamic world
|By Khalid Yousaf, Special to Gulf News
The Islamic world has undergone significant transformation post 9/11 events. It is now coming to grips with the new realities in world politics, economics and social environment.
The awareness of its separate identity, its strengths and weaknesses, threats and opportunities stands more pronounced than ever before. Whereas the vast majority of Muslim population continues to live in poor conditions and the economic gap between the rich and the poor is widening further, the need for economic and financial integration through strong political leadership is emerging as the need of the hour.
more at link.
will the dinar trade on the forex exchange? or wil lit get its own exchange, govts tade accounts? and passive agressive weatlth holders acumulators, uh question. does this mean the dirham to or......... heck steady one thing at a time, let silver bullets take care of silver then we will talk about the dirham sheez. one message at a time , just like one mind at a time! got security?
CoBra(too) (2/22/04; 19:00:13MT - usagold.com msg#: 117526)
Kerry Trade?
Looks like a good bet - without beating around another gory bush. In any way, if I may say, some lost years and a few trillion to debit, now called credit. Wonderland, lacking Alice, with malice!
Of the many battles fought and won, Slingshot and Gandalf may be well advised to retreat for a short while. It may be time to give the troops a little respite and rest ...
and time to regroup the battle forces.
As the Dollar camp has re-inforced its flanks by winning over the almost extinct Samurai by lethal persuasion - of WAT - not so much on any fundamental flaws, other than sending troops of Yen to the destiny of fodder for friendly, though still deadly fire - the last Samurai has adopted a similar ploy. Koizumi may well become another acronym for Kamikaze; ... and in the final analysis, today's
terrorist suicide bombers, even if rarely Japanese now a days, further the death wish of the US Dollar regime by (re-) clamation.
Regrouping the dollar forces may be a prudent maneuver. It also may prove to be of scant effect. After all, the troops are spread out far and wide - now covering almost 140 countries of the globe, some occupied in a friendly way and a few less so ... and there still is Guantanamo Bay - and of course, the total occupation of the globe's currency system;
The Dollar Standard - occupating credit in form debit - a perverse and corrupt interpretation of the novel W.D.C. bilingual artistics. As my favorite quote of the week hinted on the bilingual attics of inside the Beltway: " The other language is truth; It's only sparingly used ... so far"!
Ha, make killing in the Dollar's short term supposed reaction ( not recovery - way past the stage) or stick to your guns and save your energy by saving your real, honest and true values ... In Gold we TRUST! cb2
Disclaimer: Please don't construe above statements as merely forward looking, nor as blasphemy towards GOD, in whom you may believe as I do, and as I am not a certified investment consiliere, nor a Registered Rep. of Wall Street - I state Echo-Bubbles naturally blow up, er, until they NaTuraLLy Blow UP, That IS! ... or get deflated, as another school of bubbleconomics suggests.
The difference may be prove to be negligible - the effect less so ... g'nite ...
Goldilox (2/22/04; 17:21:25MT - usagold.com msg#: 117525)
Thought for the day
http://www.wizardsofmoney.org
"Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when the enterprise becomes the bubble on a whirlpool of speculation. When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done".
John Maynard Keynes. "The General Theory of Employment, Interest and Money". 1936
Goldilox (2/22/04; 16:59:59MT - usagold.com msg#: 117524)
Spiker's Practice Jump
Good thing it's only warm-up. Don't let the opposition see what he can REALLY do!
Gandalf the White (2/22/04; 15:28:57MT - usagold.com msg#: 117523)
Fun CHART ! <;-)
http://focus.comdirect.co.uk/en/detail/_pages/charts/main_large.html?sSymbol=GLD.FX1
IF you look very fast --- You will see SPIKE's practice jump yesterday !!
<;-)
Goldilox (2/22/04; 15:05:01MT - usagold.com msg#: 117522)
There is no Inflation!
I just filled my up bike for the third time in a week.
premium gas - same brand
Last Sunday - 2.05
Wednesday - 2.15
Today - 2.25
Ten pecent in a week ain't bad. Using the FED's annualization formula, that's 520% per annum. If it "grows" thusly for 52 weeks in a row, compounded, premium gas will be $291.18 per gallon.
In 55 weeks, it reach gold's current resistance at $426.
Similar growth in POG will yield $8500/ oz. in 55 weeks.
Remember, this is just inflationary adjustment, not growth in value!
USAGOLD / Centennial Precious Metals, Inc. (2/22/04; 14:43:05MT - usagold.com msg#: 117521)
Peace of mind, 24/seven
http://www.usagold.com/buy-gold-coins.html
Trapper (2/22/04; 13:53:44MT - usagold.com msg#: 117520)
****400.90****
Gold has been the place to be because the dollar was not. Repeat after me "there is no inflation" Live small"
Old Yeller (2/22/04; 13:33:34MT - usagold.com msg#: 117519)
Hello,Econoclast
Blast from the blast indeed.Nothing better than a knock 'em down,drag'em out tussle between FOA and ORO,amazing output from those two at that time.We were truly blessed.
My favorite ORO quote,"When push comes to shove,the above ground gold IS the money supply."
Whole lotta pushing and shoving going on these days,yes?
steady (2/22/04; 12:53:24MT - usagold.com msg#: 117518)
ARISTOTLE
i think i dun learnt sumting.
the wise old arabian philospher GIBRAM KALLIL said wiisdom doesnt come from words,
wisdom comes from the meaning behind words......
so honest money, or property, r butt mear words and dont matter, whats the meaning behind those words> SECURITY<
gold: got security!
Max Rabbitz (2/22/04; 12:50:39MT - usagold.com msg#: 117517)
**** $401.7 ****
Gold's stellar performance? Names like Helicopter Bernanke, SUV McTeer, Maestro Greenspan, Fannie and Freddie come to mind. But they're just the enablers and spin team. I'd give the prize to the American People and their twin deficits of a Trillion $$. Not just the politicians. The masses of people who seem to think that they can borrow and consume their way to wealth, and somebody will just keep lending them the money.
Druid (2/22/04; 11:09:08MT - usagold.com msg#: 117516)
Greenspan Returns to "Barbarous Relic" Gold
http://www.capmag.com/article.asp?ID=1685
"Summary: The last time that gold was above $370 was December 6, 1996. Students of military history won't find that date significant, but Fed-watchers will. That was the day following Alan Greenspan's speech in which he first warned of "irrational exuberance" in the stock market. And it was the day that Alan Greenspan took America off the gold standard."
www.CapitalismMagazine.com] Gold traded above $370 per ounce at the end of last month, for the first time in six years. Anxiety about war with Iraq has no doubt contributed to gold's surge -- but a look at history suggests that gold may be telling us as much about Alan Greenspan as it is about Saddam Hussein
The last time that gold was above $370 was December 6, 1996. Students of military history won't find that date significant, but Fed-watchers will. That was the day following Alan Greenspan's speech in which he first warned of "irrational exuberance" in the stock market. And it was the day that Alan Greenspan took America off the gold standard.
What? Didn't Franklin Roosevelt abrogate gold convertibility in 1933? And didn't Richard Nixon close the Treasury's gold window for good in 1971? All true -- but nevertheless, from the time he took the chair of the Board of Governors of the Federal Reserve System in 1987 to that speech in 1996, Alan Greenspan had implicitly returned America to a gold standard.
The chart below proves it. From 1987 to 1996, the Fed funds rate very closely tracked the 2-year moving average of the gold price. We may never know the exact thought process, but this much is clear: For that decade, when the gold price was rising, Greenspan was raising the federal funds interest rate, just as though he regarded gold as a leading indicator of inflationary risk. Conversely, when the gold price was falling, Greenspan eased.
************************************************************
Druid: A very interesting perspective. It's almost as if Greenspan got hoodwinked(caught flat footed) by Rubin and crowd. Devine the dates, and correlations and then bring back to memory GATA's contentions. Also note a few of the nuggets in some of Greenspan's most recent speeches. I know that I give Maximus a hard time but HE KNOWS, YOU BETTER BELIEVE HE KNOWS AND UNDERSTANDS GOLD.
Gandalf the White (2/22/04; 10:05:24MT - usagold.com msg#: 117515)
TA TA TAAAAAAAAAAAAAAAAAAAAAAA -- POG Contest Entry LISTINGS !
Let us not forget that a POG CONTEST is still open for entry ! <;-)
Entries as of SUNDAY 2/22/04 at 10:00 Denver (MST) time !!!
Listed in order of decreasing values !
----
*** $44,444.4 *** mikal (02/19/04; 23:07:50MT - usagold.com msg#: 117414)
**** $444.4 **** Zhisheng (2/17/04; 23:13:41MT - usagold.com msg#: 117274)
**** $439.1 **** Gold Standard (2/19/04; 04:38:07MT - usagold.com msg#: 117359)
**** $433.6 **** steady (2/17/04; 22:22:53MT - usagold.com msg#: 117268)
**** $432.1 **** Gandalf the White (2/17/04; 22:16:57MT - usagold.com msg#: 117265)
**** $430.1 **** ha_tey_o (2/18/04; 00:53:54MT - usagold.com msg#: 117280)
**** $427.0 **** Sundeck (2/18/04; 09:31:49MT - usagold.com msg#: 117302)
**** $423.0 **** The Silver Surfer (2/20/04; 07:07:12MT - usagold.com msg#: 117428)
**** $422.2 **** monTROZ (02/19/04; 23:36:10MT - usagold.com msg#: 117418)
**** $420.0 **** Liberty Head (2/18/04; 10:53:18MT - usagold.com msg#: 117305)
**** $419.2 **** Smeagol (2/18/04; 23:16:34MT - usagold.com msg#: 117354)
**** $417.0 **** J-Bullion (2/20/04; 07:17:32MT - usagold.com msg#: 117429)
**** $415.1 **** Henri (2/19/04; 13:09:08MT - usagold.com msg#: 117374)
**** $415.0 **** Clink! (2/18/04; 08:57:34MT - usagold.com msg#: 117296)
**** $414.7 **** slingshot (02/20/04; 00:38:06MT - usagold.com msg#: 117420)
**** $414.6 **** Goldilox (2/20/04; 12:19:05MT - usagold.com msg#: 117443)
**** $413.5 **** Waverider (2/21/04; 23:27:55MT - usagold.com msg#: 117509)
**** $409.9 **** pmurgsRSA (02/20/04; 04:22:00MT - usagold.com msg#: 117423)
**** $409.2 **** DryWasher (02/19/04; 18:23:40MT - usagold.com msg#: 117391)
**** $407.0 **** Dollar Bill (02/20/04; 19:34:21MT - usagold.com msg#: 117472)
**** $404.8 **** Survivor (2/18/04; 13:58:51MT - usagold.com msg#: 117317)
**** $396.5 **** balzac (2/20/04; 11:49:46MT - usagold.com msg#: 117441)
**** $387.5 **** gvc (2/20/04; 12:45:10MT - usagold.com msg#: 117446)
**** $386.0 **** Brett Woods (2/21/04; 16:45:57MT - usagold.com msg#: 117503)
====
Perhaps these contests are tooooo long in duration ?
BECAUSE, it looks as if everyone wants to wait until sometime Wednesday to enter their prognostication, as
--Wednesday midnight (Denver time is the DEADLINE time.)
BUT, the time length is to give YOU LURKERS time to get your PASSWORD and win the FREE GOLD and Silver.
<;-)
Druid (2/22/04; 09:12:37MT - usagold.com msg#: 117514)
Gold Statistics and Information
http://minerals.usgs.gov/minerals/pubs/commodity/gold/
Gold has been treasured since ancient times for its beauty and permanence. Most of the gold that is fabricated today goes into the manufacture of jewelry. However, because of its superior electrical conductivity and resistance to corrosion and other desirable combinations of physical and chemical properties, gold also emerged in the late 20th century as an essential industrial metal. Gold performs critical functions in computers, communications equipment, spacecraft, jet aircraft engines, and a host of other products. Although gold is important to industry and the arts, it also retains a unique status among all commodities as a long-term store of value. Until recent times, it was considered essentially a monetary metal, and most of the bullion produced each year went into the vaults of government treasuries or central banks.
***********************************************************
Druid: Gold, it's just a "barbarous relic".
mas (2/22/04; 06:18:40MT - usagold.com msg#: 117513)
Again good points from the Privateer.
Since January 31, 2002, the $US index has fallen from 120.59 to close - on February 17, 2004 - at 85.12.
On January 31, 2002, the Dow closed at 9920. It closed on February 17, 2004 at 10714. Nominally, this
is 794 points higher than it stood on January 31, 2002 at the height of the $US index. But in global terms,
the Dow is now FAR below what it was in January 2002. To get even with its 9920 level of January
2002, given the fall in the $US index since then, would require the Dow to stand at 14054 today.
The REAL Trade Deficit:
On February 21, Elizabeth Becker writing for the New York Times, reported on what is REALLY
happening in one of the largest ports in the US - Seattle, Washington.
"Huge commercial container ships steam into this port every day loaded with clothes and shoes, furniture
and video games, electronic and aircraft parts made in Asia. On their return trip, those same ships often
cross the Pacific half-empty, carrying inorganic chemicals, meat, grain and engines and routinely stuffed
with hay or scrap paper. ‘This is what the nation's trade imbalance really looks like,’ said Mark Knudsen,
deputy director of the Port of Seattle. ‘We've got so much empty cargo space, it pays to ship over hay for
Chinese animals or scrap paper to be recycled into packaging for Barbie dolls.’"
REAL goods, both consumer and producer goods, are coming into the US. What is being shipped back is
basic foodstuffs and the scraps left over from consumption. The products of a "first world economy" are
being shipped into the US. The products of a "third world economy" and the fresh air of empty cargo
holds are being shipped back.
The tragic reality of the situation is simple. With many honourable exceptions (though their numbers are
sadly dwindling - fast), the US economy is not an economy which produces real wealth. It imports
producer and consumer goods, it exports basic foodstuffs and the recycled packaging of its imports. To
redress the balance, it exports US Dollars. This must be clearly understood. The major "export" of the
US is US DOLLARS. The US is following in the well-trodden path of every empire or "superpower" in
history. Having consumed its own substance to become "powerful", it is now obtaining the substance of
the rest of the world in exchange for scraps - "hay or scrap paper" - and Dollars.
Make no mistake, Mr Greenspan and Mr Snow know that the only thing they have to offer in return for
keeping the shelves of Wal Mart stocked, the gas pumps full, the stock market "buoyant", and the debt
load "viable" is the Dollar. They are NOT relaxed about its fall.
Got gold?
Ned (2/22/04; 04:48:25MT - usagold.com msg#: 117512)
nordattack
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID667551&cmd=show[s21672208]&disp=P
"What is really going on here?"
The best question evar! What is REALLY going on here?
First thing you have to do is have a good look at the link compliments of Waverider; the 'relative' value of the dollar measured against a basket of currencies. This is very, very important to understand. The US dollar index is the 'suggested' fair value of the buck as measured by currency traders who buy and sell enormus amounts day in, day out. If the FED decides to 'dilute' (via supply) traders will bring it down. It will be collectively decided that the dollar is 'worth' less. Very simple concept really.
So.......
In periods of time when the dollar has been 'determined' to be strong, most things, (all things being equal) will be cheaper and when the dollar is 'determined' to be weaker, all things will be more expensive. So the theory in a nutshell is this; we have been told that printing dollars (out of thin air) produces inflation, why? Because there is more of them out there (supply) causing a 'dilution' effect making the dollar weaker, which can be measured with the US DX graph and causing higher prices.
So........
In a relatively stable DX period from 1989 to 1997 gold had the 380-450 range that you implied. One must compare the DX graph against a multi-year gold graph to see the concept accurately. The dollar swoon into 1987 led to the $500 mini-peak, the 1997 to 2001 dollar boom lead to the $400 to $255 gold crash and since 2001, of course we have had the dollar slide/gold boom. It is all accountable, measurable & accurate.
Now.......
We enter into a gray, cloudy area. Will the DX gain support at that 85ish zone which by no coincidence is the gold resistance at $430. Charting self-proclaimed heros claim that if the DX breaks 85 gold will break $430; well no kidding batman! And if the DX goes to ZERO, gold goes to the moon!
That DX chart explains everything nordattack. Notice televisions and most electronics (imported from Japan) reached a bottom in the last year to two? Notice the price of shoes at Walmart, remember Nike Air at $150, then $100, 90,80,70,60...... Sure some of the price collapse was the novelty wearing off but most was DX (bigger dollar '97-'01) I bought Nike Air for $45 a year ago!
So........what's really going on here?
You tell me if the DX breaks 85 or for that matter 80 or rises and takes out 90 or for that matter 100 and I will tell you the price of ANYTHING! Just remember DX up is disinflation and DX down is inflation. Please consider this the FIRST aspect of the relative driver of cost, SECOND aspect is supply/demand fundamentals which perhaps we can discuss another day, yes?
Ned Johnston II
Topaz (2/22/04; 03:09:46MT - usagold.com msg#: 117511)
Cash Dollar digs in.
http://www.futuresource.com/charts/micro.jsp?d=LOW&go.y=13&r=&p=D&b=line&s=dx1%21&s=gc1%21&s=fvxy&s=tyxy&go.x=12&v=
The trend to liquidity looks set to resume with DX striking out to the upside....this could be IT!
When everything is being questioned, take the easy path -- Physical Gold in hand.
Goldilox (2/22/04; 00:55:50MT - usagold.com msg#: 117510)
Outcry over bank's record £6.1bn profit
http://news.independent.co.uk/business/news/story.jsp?story=493245
snippet:
"Politicians have called on the Government to crack down on the massive earnings of Britain's high-street banks after Royal Bank of Scotland (RBS) revealed it had made £6.1bn of pre-tax profits in 2003.
The bumper figure, which was up by nearly a third on the previous year, is the biggest profit ever recorded by any British bank, or any UK company, this year. Critics say RBS's profits reflect a wider problem that British banks have managed to make excessive sums from consumers and businesses at a time when individuals' debts have been escalating and companies have struggled to remain buoyant in the recent economic downturn.
Vincent Cable, the Liberal Democrat Treasury spokesperson, said: "The banks may well boast about their billion-pound profit margins, but they are making money at the expense of others who are getting deeper and deeper into debt."
Goldilox:
The public in the UK is getting a little tired of banks that "borrow" at 2% rates and lend to the public at exorbitant double-digit card rates, similar to US banks. The margin between bank borrowing and lending rates is at an all time high, creating windfall profits for the banksters.
ViewYesterday's Discussion.
