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To: Beelzebubba; madison10
I think $5000 gold is plausible, but it would come in large part due to dollar devaulation, which will mean that the Dow will tend to be priced high due to inflation.

Another way it *could* hit this without massive dollar devaluation is if a country such as China or India undergoes a massive stockpiling of gold. For example, if China decides they want the Yuan to be a global standard currency and they want to have it backed, at least in part by gold, to make it competitive, they could make a run on the gold market- supply and demand would dictate the cost goes up. At the same time, the dollar's value against its standard competitors such as the Yen or Euro may not change as much as they are also being impacted by the same change in global currency demand.

13 posted on 09/24/2009 7:48:34 AM PDT by mnehring
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To: mnehring

China owns gold mines. They can probably fill their needs without buying in the open market.


53 posted on 09/24/2009 11:33:12 AM PDT by DManA
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