over 14 million shares traded today!, page-11

The reverse effect - gold would become a hedge again.

I don't personally see this happening.

I read a lot of stuff from the States. None of it is suggesting a slowdown in the economy, so interest rate hikes are on the way. Probably 0.25% increases (at least a couple). So the US$ will continue to strengthen into the election.

What would be interesting is a fall in the price of oil. At some stage the yanks will want payback from the Saudis who must be loving $40 a barrel right now.

But let's be really cyncial, the yanks are loving it as well - they have enjoyed enormous productivity gains, so they can absorb a higher oil price right now, oh, but wait, there's more ... if you were trying to rebuild a country using their oil, would you want the price to be high or low??? At some stage the Yanks will need to remind the Saudis that the price needs to come down ... sooner rather than later if Bush is to win the electron, but this would be an abberation. Long term, oil is headed up imo.

Phil