Post by steve mann on Aug 20, 2004 18:08:40 GMT -5
"...Gold is still not really in a true bull market and that it has done nothing but correct since 2003 when priced in Rands or Namibian dollars. If the dollar (US?) were to mount a significant technical rally in the next few months..."
as an article in early July on www.financialsense.com pointed out, from a historical perspective, reserve currencies tend to stay high, regardless of fundamentals and manipulation. I can no longer find that article - a google search on the site pulls up nothing. it dissappeared awful quick (or I misread it).
Will the US$ surprise to the upside, in the same way that oil "surprised" to the upside? then what happens to gold? deflation from a gold holder's perspective?
US fundamentals are historically shocking, but so are the rest of the world's - so who's currency will step in as the "new reserve" to enable a US dollar decline? The Chinese? the Japanese? the Euro? one thing for sure, they won't have CNBC talking them up...
what about the so called "tipping point"? if oil and commodities go high enough, the Asians would be better off allowing their currencies to rise and earn less on exports and lose value on their US$ investments. probably, commodity input is too small to cause a "tip", which spells a stronger US$.
the big Q - where will the dollar index be end of the year? my witless guess - low 90s - no dollar decline for a long while.
as an article in early July on www.financialsense.com pointed out, from a historical perspective, reserve currencies tend to stay high, regardless of fundamentals and manipulation. I can no longer find that article - a google search on the site pulls up nothing. it dissappeared awful quick (or I misread it).
Will the US$ surprise to the upside, in the same way that oil "surprised" to the upside? then what happens to gold? deflation from a gold holder's perspective?
US fundamentals are historically shocking, but so are the rest of the world's - so who's currency will step in as the "new reserve" to enable a US dollar decline? The Chinese? the Japanese? the Euro? one thing for sure, they won't have CNBC talking them up...
what about the so called "tipping point"? if oil and commodities go high enough, the Asians would be better off allowing their currencies to rise and earn less on exports and lose value on their US$ investments. probably, commodity input is too small to cause a "tip", which spells a stronger US$.
the big Q - where will the dollar index be end of the year? my witless guess - low 90s - no dollar decline for a long while.