Gold Price Monitor Message Board - Msg: 19309908

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To: Chispas who wrote (95876)	9/16/2003 11:10:08 AM
From: Chispas	of 99558

James Grant, quotes from THE DAILY RECKONING... _________________________________________________________ No, you don't have register to read the whole article, just click down... Excerpt: http://www.dailyreckoning.com/signuphub.cfm?List=Pop-Ups&sourceid=PI-JoinT "The Fed's pro-inflation campaign is also exerting a favorable influence over the gold price. A little bit of inflation - like a little wildfire - is a difficult thing to contain. And the gold market seems to have caught a whiff of inflationary smoke. - "Gold is not an 'investment' per se," your New York editor opined last week, "It is insurance." James Grant agrees. The editor of Grant's Interest Rate Observer not only considers gold to be a terrific insurance against monetary calamity, but darn cheap insurance at that. "If gold isn't a bargain, what is it? It is a hedge," Grant explains. "However, in my opinion, it is a hedge bargain. The value of a hedge should vary according to the cost and evidence of the risks being hedged against. In the case of gold, the risks are monetary. They are potentially very costly, and they are more than imminent. They are upon us in the shape of burgeoning deficits and a radically reflationary policy stance. Owning gold, you are insuring not against what may be but against what already is..." - In other words, says Grant, the dollar's value is already slipping away, and yet, gold at $375 an ounce remains a relatively inexpensive insurance policy against continuing, perhaps calamitous, dollar depreciation. "The price of fire insurance would be out of reach if the homeowner started shopping for it after his house was billowing smoke. Yet, in my opinion, the price of monetary insurance is still reasonable in view of the risks posed to the purchasing power of the dollar by the dollar's own stewards... - "I have been bullish at long, unprofitable intervals during the gold bear market that began before the birth of Britney Spears," Grant concludes. "[But] I wake up every morning in the belief that the international monetary system is one day closer to breakdown. I am certain that posterity will look back at this episode in monetary history with a mixture of mirth and amazement..." - Keep the insurance policy in force, Grant advises. Buy gold." ---------------

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