"MacHamish" <russj41@concentric.net> wrote in message
news:u4fhq0ddcl6djfvbqocv5a68fcj2obabs8@4ax.com...
> On Sat, 27 Nov 2004 17:30:36 -0000, "Nebulous"
> <Nebulous@pigtail.freeserve.co.uk> wrote:
>
> >
> >"MacHamish" <russj41@concentric.net> wrote in message
> >news:v9dhq01e17lgdv9taj69kr33ipsup806te@4ax.com...
> >> On Sat, 27 Nov 2004 09:21:22 GMT, "necoandjeff" <spam@schrepfer.com>
> >wrote:
> >>
> >> >Adam Whyte-Settlar wrote:
> >> >> "MacHamish" <russj41@concentric.net> wrote in message
> >> >> news:0cmeq09j4su2c8u5klcmr307gk14tron98@4ax.com...
> >> >> .
> >> >>>
> >> >>> 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.
> >> >>
> >> >> Gold is going up because your dollar investments are going down down
> >> >> down - you aren't really gaining anything Dumbo.
> >> >> A W-S
> >> >
> >> >Yes, what an idiot, he should have kept 100% of his money in those
dollar
> >> >investments...Adam, you're a genius!
> >>
> >> He sure is, isn't he.
> >>
> >
> >Actually he should have bought Euro's.
>
> Yes, when it indexed in the 80's vs. the 130's, but even at that, it
hasn't
> outperformed gold over roughly the same time frame.  I'd much rather
> speculate on gold than the vagaries of an individual currency.  It spreads
> the risk.  It's also easier.
>
> >Either way each individuals flight from the dollar contributes to its
> >problems. America has to increase interest rates and tighten its belt.
>
> I agree, and it's unfortunate at this juncture in terms of the global
> economy.  We probably wouldn't be at this juncture were it not for the
> "international cummunity" refusing to see the real threat.  It's a pity we
> aren't all on the same page where militant Islam is concerned.
>

You're not at this juncture because of the international community.  You
have reached this point because your government has pumped massive amounts
of liquidity into the market by reducing interest rates to prevent a
downturn. It did this just after the dotcom burst and then again later on.
One of the impacts of this has been rises in house prices and people
remortgaging to buy consumer goods.

Policy needed tightening at least a year ago to prevent a 'hard landing' but
that wasn't possible given the political situation. So rates stayed low to
help until after the election and the hard landing now seems inevitable.

Your arms budget and military commitments haven't helped the situation, but
it was there anyway without the recent jaunts.

Neb