Costard

Dollar vs. Gold - Can We Trust This Change?

Why should the dollar's' strength be perplexing? It performs well in crises for two reasons: it's relatively stable, and it's easy to obtain anywhere in the world. Stability - and plentiful supply - are a factor of size and longevity as much as fiscal responsibility. Great amounts of dollars can be hoarded without driving the price up very much, and a well-defined history and tradition is in place.

"The dollar should be faltering" - relative to what? Please defend this statement. Germany is a red herring - one cannot very easily purchase marks these days, and the euro carries a lot of deadweight - along with a risk of not being there in 5 years. What currency would be safer, and why aren't you then invested in it? If gold's gains are dependent upon the dollar's losses, then simply skip the middle man and purchase whatever currency the dollar is losing against.

I do like gold, but your theory is bunk. You cannot argue for a thing simply by arguing against something else, and that poorly. Come up with some reasons to like gold - there are plenty - and then your article may contain more meat.

Also, the charts in this article are a mess... a 3-month would show a head-and-shoulders in the dollar rather than a double-top, and a 12-month or 2-year would better place it in context. The chart on gold is too narrow, and in any event I think the characterization of the last 3 weeks as a potential double-top is laughable considering the time frame and gold's recent history... and what about the "potential double-bottom" - make that actual - sitting immediately before it on your graph?