dvd, I agree with you completely, people do not look at the numbers. As a reminder to our gold aficionados, here are few posts, reflecting the opinion you voiced: #msg-411202 (7/11/02); #msg-507644 (9/22/02), #msg-1150995 (6/28/03); here is one with some calculations why going back to a gold standard is simply ridiculous: #msg-555089 (10/26/02); here is a short version of your thesis: #msg-1242586 penned just two months ago (7/24/03). Here is #msg-1150808 from 6/28/03, where I repeat, again, the facts about supply and demand in the gold arena. Unfortunately, just like all gold letter writers, none of our gold bulls attempted to repudiate these numbers.
Simply put, a major move in gold is not going to be tied to gold's fundamentals anytime soon. Gold price, IMTO, simply reflects the relative strength or weakness of the dollar. Here and there, spikes up and down will occur due to temporary external events. With crude coming down, with the US economy strengthening before the rest of the world (sans China and few other Asian economies), the dollar should not be expected to go much further down. The huge balance of payment deficit (putting downward pressure on the dollar) being balanced with the better than the rest of the advanced economies growth (putting downward pressure on the Euro).
dvdmogul: You're right of course; the movie was "The Fountainhead." I agree too that gold cannot be THE backer of currency though perhaps a partial tie might limit the political boys to moderate the printing of globs and globs of paper. Just thinking.
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