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Saul Mine
Penny Collector Member
USA
343 Posts |
 Posted - 04/13/2008 : 12:52:30
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Get Used To Thinking Of Gold, Not The Dollar, As Real Money
by Jay Taylor
A Sign of Inflation, Gold Lags Copper and Silver
Copper is often referred to as Dr. Copper because it has been so good at diagnosing the future of the global economy. If copper prices are on the rise, it is usually indicative of economic growth or perhaps a combination of a copper shortage during a period of stable to rising demand. Simply put, if copper is trading near its all-time high, it is very difficult to conclude that deflationary forces are dominating. If copper prices are rising relative to gold, we view that as an inflationary symptom. On January 31, 2005, the price of copper was $1.49 per pound. Since then it has risen 165%, to $3.95 per pound.
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Edited by - Saul Mine on 04/13/2008 12:53:36 |
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Ardent Listener
Administrator
USA
4841 Posts |
 Posted - 04/13/2008 : 18:41:09
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quote:
Originally posted by Saul Mine
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Get Used To Thinking Of Gold, Not The Dollar, As Real Money
by Jay Taylor
A Sign of Inflation, Gold Lags Copper and Silver
Copper is often referred to as Dr. Copper because it has been so good at diagnosing the future of the global economy. If copper prices are on the rise, it is usually indicative of economic growth or perhaps a combination of a copper shortage during a period of stable to rising demand. Simply put, if copper is trading near its all-time high, it is very difficult to conclude that deflationary forces are dominating. If copper prices are rising relative to gold, we view that as an inflationary symptom. On January 31, 2005, the price of copper was $1.49 per pound. Since then it has risen 165%, to $3.95 per pound.
A real conundrum to me as to why we are seeing such high copper prices in a world wide economic slow down.
Perhaps it is due, in part, to investors buying copper for the same reason they are buying gold and silver..........as a hedge against a falling dollar and perhaps a soon to be falling euro. In addition, I think a lot of countries such as China and India are buying copper way beyond there current needs because; why not buy copper now with their falling dollars when they are going to need it sooner or later? In other words, they are hoarding copper much as we are. That copper still is around in bar form, but it is no longer counted in the World's copper stock storage on the international markets. |
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Think positive. |
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Saul Mine
Penny Collector Member
USA
343 Posts |
Posted - 04/13/2008 : 22:14:17
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| China, India, and several others are not speculating, they are growing. They NEED that copper right now! |
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wolvesdad
1000+ Penny Miser Member
USA
2164 Posts |
Posted - 04/14/2008 : 15:05:51
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But that doesn't mean they aren't buying up and storing an excess of copper to beat the price and meet future needs. I mean, trading all of their falling FRNs for copper that they know they will need....seems like a pretty smart move.
Ni Hau! (Mandarin for 'hello') |
"May your percentages ever increase!" |
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Saul Mine
Penny Collector Member
USA
343 Posts |
Posted - 04/15/2008 : 02:22:40
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| BTW, there is almost NO analysis for why the gold/silver ratio might go up or down. That is one reason why I thought this article was significant. So far we know that the g/s ratio tends to go down as DOW goes up, or when inflation increases. It might also be an indication of lagging lead or copper prices causing a reduction of silver output. (Since most silver comes from lead, zinc, or copper mines.) |
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Gold Lags Copper and Silver
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