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You miss the point in the value of gold. It is denominated in USD. If I am
living in a country that doesn't allow me to own a foreign currency what do
I do? check the price of gold versus the Euro, French Franc, Lira, Swiss
Franc, any easter european country, the ruble, or the south american
currencies and
you will see a distinct rally in gold over the years.
Good point IRA. Your message reminded me of a gold trading strategy used by
my mentor, David Johnston at E.F. Hutton, many years ago. He always kept two
sets of gold charts. One denominated in dollars and the other denominated in
Swiss Francs. He said this allowed him to see what was happening to gold
without being entirely dependent on the direction of the US dollar.
In periods where the dollar is unusually strong or week, I think this logic
could be applied to many other commodities as well. Keeping charts in
multiple currencies was a big task back when they had to be plotted by hand
but it was worth the effort then and it should certainly be worth the effort
now that we can do it with a couple of extra keystrokes in a simple
spreadsheet program.
Chuck LeBeau
www.
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