Axiom Home Page Forums General Discussion Home Theater looking for new home theater speakersHi, I'm look

Not to belabor a point about economies and why the difference in the CAN./US dollar, certainly the oil prices have a dramatic change in the CAN dollar but the US dollar is now artificially high because so much of their mammoth(and growing) debt is being bought up by foreigners via the sale of their treasury bonds. The US government is selling these to finance all these stimulus packages. China alone, owns almost $500 billion of these. If the Chinese ever decided to pull the plug and dump these, the Mexican peso would start looking good. Over the next year it has been predicted with the printing of money, increased inflation, the US debt continuing to grow, and oil prices starting to edge back up, the dollar difference will narrow.

We can only hope. *sigh*

Yup. It turns out that there is not yet a replacement for the US as a safe haven, thought I am not so sure how 'safe' the US financial system is any more.

I was reading a very interesting article in The Economist. It is postulated that some of the financial bubble in the US was driven by world money coming back to the US. It seems most of the world trusts the US financial system more than what is available locally.

I tend to agree that the US$ is over valued and will fall again over time. Canada, unfortunately is tied to the US economy and resources, both of which have taken a beating of late. I expect that the C$ will go through another rapid climb once once we are through the current mess.

Oh yeah! The M60's

Some would argue that gold is the only real safe haven, but it also fluctuates quite a bit. If it were to form a solid base around the $1000 level, who nows where it could go? (I don't own any, couple of shrinking positions in some juniors though)

Isn't this the investment forum? Oh yeah, sorry!

Gold is an interesting beast all on its own. If you look at it over a 400 year period, it has fallen in value steadily, probably because of the rate of extraction. OTOH all the gold ever mined equals two olympic swimmingpools in volume.

I believe gold to be a true measure of inflation because, unlike currencies and financial markets, it is very hard for governments to manipulate gold, particularly since most of it is now held in private reserves.

The fact that gold is now quite well supported at the $800 level where in 2000 it was only 200 tells you that a lot more inflation has taken place over that period than official sources would have you believe.

Actually Fred, the quantity of gold "sold" vs the quantity "extracted" are two different subjects. I don't want to try to remember figures I heard a good ten years ago, but my understanding is that more gold has been sold on paper than actually exists in extracted form. Kinda reminds you of banks lending money they don't have.

Well, there are the consiracy theorists that claim that the US government has done this to manipulate the price, and there are cliams that some ETFs are not holding the reserves they claim.

The former is probably doodoo, the latter, who knows.

A good conspiracy theory sounds good on a full HT system, doesn't it?