Heremes, how do you see gold going to $US 500? Global gold production is falling and hedge funds have all but completed unwinding of their long gold positions in the paper markets. What on Earth would entice gold holders like yourself to sell their gold to buy USD? OK, deflation may get worse but gold does relatively well here versus other assets and there is always the threat of inflation down the road for a fiat currency.
In either extreme of deflation or inflation, gold will do relatively well IMO. Somwhere in the middle, it does well too as has proven to be the case all this decade.
Rowingboat.
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