Euro almost at it's introductory value vs the Dollar!

[Kidlicious]

I'll let Fez have the last word for your side of the so called 'debate.' His comments will surely represent your logical ability.

[TCO]

Originally posted by DrSpike
GP:

[Last word mode]

There is no reason given your caveats for the dollar price of gold to move. There is a reason for the dollar to appreciate against the euro. So this implies for consistency that the price of gold in terms of euros must rise as I said. It's just a standard arbitrage argument.

Start 1 Bar = 1 dollar = 1 euro
Then 1 dollar = 2 euros

Ergo, price of gold is arbitraged to 2 euros, or else people would just buy gold and convert to dollars. They do this until it isn't worthwhile, which is when the price of gold hits 2 euros.

Of course in reality the vagaries of the gold market are such that it is impossible to detect this effect amongst all the buffeting to supply and demand of gold. But your caveat protector stopped me making that point.

[/last word mode]

Actually I'm going for a barbecue in the sun now, so anyone that wants it can have "post (hur hur) last word".

ummm, I agree that arbitrage conditions must be met. But that could happen in a number of ways:

Start: 1 bar = 1 dollar = 1 euro

End: 1 dollar = 2 euro.

gold could be,
A. 1 bar = 1 dollar = 2 euro (euro inflated)

or

B. 2 bar = 1 dollar = 2 euro (dollar deflated)

or

C. 1.5 bar = 1 dollar = 2 euro (dollar deflated moderately, euro inflated moderately)

When I say nothing is changing wrt gold supply and demand, I mean that the population's inherent lust for gold hasn't changed nor have any mines opened or closed. But why should that say that the price is constant wrt dollars? I mean, why not say it should be constant wrt euros? And obviously to satisfy arbitrage, it can't be constant to both at the same time. Why have the conditions in our example made it constant wrt dollars rather than wrt euros?

[Saras]

http://www.stone-dead.asn.au/albums-cds/sounds/sketches/argument-clinic.ra

[DrSpike]

GP: I was under the impression that gold trades were almost exclusively denominated in dollars, which would lead to a situation closer to my case than the ones you outlined.

This may not be the case.........maybe Sten would know more about gold trades.

[TCO]

Originally posted by DrSpike
GP: I was under the impression that gold trades were almost exclusively denominated in dollars, which would lead to a situation closer to my case than the ones you outlined.

This may not be the case.........maybe Sten would know more about gold trades.

I would think more fundamental factors would be involved than how the trades are denominated.

[Imran Siddiqui]

GP:

You ate leftover steak COLD?! Jeez, man! Was it any good? You could have just warmed it up on a skillet .

[DrSpike]

Btw what was Saras' link?

[yavoon]

wtf cold steak is great. unless of course the steak sucks. but if u have any taste in steak cold steak is very yummy breakfast.

[TCO]

It tasted good, but like I said. Usually what I do with a steak like that is make a sandwich or a steak salad.

Saras had an audio clip of the "argument skit" from Monty Python.

[Imran Siddiqui]

mmm, steak sandwich... I just got some good sandwich at Jersey Mikes down in Loemann's plaza on LaVista. Very nice, and good leftovers for dinner .

[TCO]

Is that Lavista and Briarcliff?

[Kidlicious]

Are you two brothers?

[Imran Siddiqui]

Is that Lavista and Briarcliff?

Yep. The place with Rolly-Poly .

[TCO]

I'm cooking some catfish now. Should I put kid on ignore?

[DrSpike]

Nah leave him.........he'll probably say more entertaining things that you might otherwise miss.