I am not an economist.

Deflation in a normal market cycle with the Dollar as a strong FICA currency should kill metals including gold.

What we have is an abnormal market and a Dollar that has decreasing basis in value except to the other decreasing (race to zero) FICA currencies or gold (which has continued higher as the US economic position deteriorates).

All this has been happening while the US government has been saying ther is no inflation or deflation either. My opinion is the money printers have been walking on the thin line between inflation / deflation for many years now and probably would have already had a deflationary cycle had it not been for all the printing and lowering interest rates.

After all we all have been trained to act like deflationists, wait untill the next model year car comes out, wait for the rebate, price gaurantees for lowest price, keep interviewing until we can get someone to work for dirt cheap, wait for the bailout.............

There are all kinds of theroem out there and one can believe what they may but the fact is people are loosing faith in the Dollar as the world reserve and all Fica money in general. Inflation is caused by money exchanging hands, deflation by money being held. I think in this continuing enviroment humans will look for a commodity to offset the Dollar loosing value ie dot com, housing , now it's gold.

But we are in a completely different place than we were during the other bubbles because the dollar and all FICA could collapse this time around.

Just as during the great depression and all the other depressions in history the US govt will not be able to cope with any of this and will print money like crazy if they think we are headed for deflation. I wonder: While the Japanese have been deflated since the mid 80's gold continued higher. What is the difference between the Yen and the Dollar today? Not much except for the colors and pictures on the paper.

I was worried about deflation too, but I cannot see people holding money if they believe it is becoming worthless.......

The Chinese support this by continuing to buy treasuries while divesting Dollars as fast as they can into commodities, infrastructure and land.

Americans are feeling like everyone else now (easy money gone) and it's easy to be pessamistic about this, which also might feel like deflation, but shouldn't this be a short term affect before hyperinflation?

As was mentioned before the scenario is rosy in deflation or inflation, but I think I would rather have deflation and gold appreciation as my real wealth in this situation would be astronomical compared to most of the population.

Go kry! this is just a small diversion to what is really happening with this stock.