Beefarmer,above parity, yeh for sure that's highly possible? I don't see why that would be bad for gold producers in Australia though, the gold price will move up further as the US dollar decreases. Countries like China and India for example will keep stocking up on gold to hedge against a falling US dollar.
The US federal Reserve doesnt seem to have the power it once had to turn around the US economy. I dont think it has got a hope in hell in the current climate. at least no time in the next couple of years.
The United States buys a lot more from other countries than it sells to them. (Massive Trade Defecit) Foreigners take the dollars they earn and sell them to get their own currency back, putting more downward pressure on the dollar.
When the US dollar declines against other currencies, gold looks cheaper to them. Gold always gains when paper currency values fall.
As a result, people and organisations in the US and around the world will keep buying gold to benefit against a weakening US currency.
A sharp decline in the US dollar will be bad for Europe and Asia. Bad news regarding the US currency, is what gold loves, it thrives on it. And this is good for us investors who are holding this stock.
AAM Price at posting:
38.0¢ Sentiment: Hold Disclosure: Held
