re: *****gold on the precipice-absolute nonsense Hi Tiger,
Then I expect that you will not be one of those arguing about rising medical costs /health insurance, rising council rates, rising elctricity, gas or utlity charges, rising insurance premiums, rising service fees (ie: for the local tradesman, etc), higher Government fees, rising registration fees, higher exploration permit costs, rising transport fares, the rising cost of postage, increased bank fees, higher education fees, higher university fees, etc.
Take a look around and in the supermarkets, department stores and elsewhere. Except in a few categories of product, prices are broadly up on where they were 12 months ago. And, by year's end, they will be up again on where they are today.
My arguments on the gold price is with respect to developing a base line for forward assessment. To date, my predictions on movements in the gold price have been fairly well spot on. Notice though, I have not predicted a fall back below $300, but nor have I argued that it will go through, or sustain itself, above $400.
Yeah, I agree with you about tossing out the text books, but just where do you think all of the commentary concerning deflation coming from?
Similarly, I have not said anything (in my recent commentary) about where the DOW is, or should be (which, at last glance, was a very narrow measure of 30 stocks in the wider broader US listed environment). Last year, however, I did argue that 9,000+ was considered fair value. Since then, a lot of Balance Sheet repair work has occurred and the quality of the BS, of underlying earnings, and of overall company performance has improved.
But, also, consider this - why use as your primary predictive tool something which is based on historical earnings performance, or is based on predictions which draw, as the basis of their assessment, the results of the past. In other words, as much as you can point to P/e's as being over-valued, I can point to them as being a statistical aberration and of limited or no meaningful purpose (except as a broad comparative measure in much the same way as the median value of housing is).
All things considered, I have supported the arguments of a higher gold price, but not of a gold price roaring out of control.
OXR
oxiana limited
