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| Updated: 1 Oct, 2005 |
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In January 2000, the US Dollar Index was 87.5. Gold was selling for $318 per ounce. On September 30, 2005 the US Dollar Index was 87.5 and gold was selling for $465/ounce. (The US Dollar Index is a indicator of the dollar's relative value, with a weighted average against the Euro, Japanese Yen, British Pound, Canadian Dollar, Sweedish Krona and Swiss Franc) Why? Because the dollar was weaker? No, the dollar has exactly the same relative value that it did in 2000. Well, what on earth could cause this aberration? Gold is supposed to follow the dollar's value, according to many experts. Looks like these experts don't really know as much as they proclaim, eh? It might just possibly be due to the unrelated fact that for the last two years, the demand for gold around the world has outstripped the supply of gold in the range of 15% to 25%. This would be a real economic reason, but not a voodoo economic reason for the change. For that, you need a freshly severed chicken head, the magic chant and some hallucinogenic substance, and the reason will appear, magically, in a cloud of smoke. Since my neighbors would complain if I kept live chickens, I can not opt for the voodoo economics and I must keep with the old, stodgy, scientific economics. The one that uses facts, logic and actual scientific principals. But that's just me, everyone has to find their own voodoo reasons, or so it would appear. I'm working on my next theory, Gold Prices the hidden relationship to the phases of the moon. You won't want to miss all the voodoo in this one! |
| Charles Kubach Mine-Engineer.Com Return To Gold Page |
