On Oct 17, 2008, at 5:07 PM, ken hanly wrote:
> Why is the US dollar staying strong and gold prices often declining.
> Are not the numbers of US dollars being vastly inflated by the
> bailouts and huge defence spending Etc. Why arenèt people fleeing to
> gold for safety rather than the American buck.
Banking crises are deflationary on balance - the bailout effect is outweighed by the credit contraction.
As for the USD vs. the EUR: we got the disease first and others are catching up.
Doug