MacHamish wrote:

> On Fri, 26 Nov 2004 03:34:48 GMT, micheil@shaw.ca (Michil$(D??(Bn) wrote:
> 
> 
>>On Thu, 25 Nov 2004 17:05:55 GMT, russj41@concentric.net (MacHamish)
>>wrote:
>>
>>
>>>In the
>>>meantime, my gold holdings are doing very well, thank you very much.
>>>
>>>MacHamish M$(D??(Br
>>
>>Of course they are! That's what they're for - to be a hedge against
>>the bottom dropping out of the US dollar!
>>
>>Rather like: "Now the Titanic is sinking, my rubber boots should prove
>>very useful!"
> 
> 
> Nonetheless, it was perspicacious of me to raise the allocation of gold in
> my portfolio a few years ago when gold was totally out of favor.  Did you do
> so, Mr. Expert Currency Speculator?
> 
> By the way, look for a brief rally in the USD.  There is a large short
> postion that will be covered at some point.
> 
> MacHamish M$(D??(Br

It is an illusion.

The rise in the price of gold reflects the fall in the purchasing power 
of the USD.  Even if you have thousands of dollars in gold, chances are 
you have more of your worth based on the USD.  That is, while the gold 
goes up, overall, you are still suffering an overall loss.  You are 
reducing the impact, but not stopping the process.