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[roni]

OT bullbear, re: gold

You asked:
I am no gold export but I wonder if economy is slowing,
and inflation is muted why invest in gold? Wouldn't you need demand for gold to be there as a result of increasing demand (growing economy)or inflation hedge?


Are you referring to the US economy or the global economy?

I think there are several things that impact the demand side, including US and foreign ETFs whose value is directly linked to the price of gold and who go into the gold market on a regular basis to buy or sell, depending on whether investment in the fund increased or declined.

There is news of some "second tier" central banks buying gold - Russia is one mentioned. It has become easier for individuals in China to buy gold, and they can buy gram balls of gold there, and apparently have been doing so at a pretty good rate lately

So there is the demand side, the supply side (constrained by cost of exploration / new mines / regulatory hurdles) and then the other side. I am not sure what to call it. Some call gold the anti-dollar, and it is true that gold has risen as the dollar has declined. If that relationship continues and if the dollar continues its decline, then there is another plus for the price of gold.

I have been investing in shares of precious metals mining companies since May, 2003. I have made some money - good money - doing so. My reading and study, such as it is, leads me to believe that 2007 has the potential to be a good year for the price of gold. In fact, I bought some more shares yesterday on the dips in the miner's indices and the price of gold.

I could turn out to be terribly mistaken. I take no responsibility for anyone else's investment decisions, and there have been times when I wish I wasn't responsible for my own .