Ann: Becoming a substantial holder, page-23

Nordesmic

You wrote

"Hard to believe that people really think the RBA will raise interest rates to 3.5%. A complete joke."

Where did you find reports of RBA mentioning that they will raise their interest rate to 3.5%? I think its currently 1.5%, still slightly ahead of the FOMC rate, and have not followed the news all that closely. I suppose if the FOMC raises its rate by 0.25% in December then perhaps the RBA will do something.

The problems for our local goldies is that the AUD POG has been tanking as the AUD rise has outstripped the decline in the POG. Plus real rates are trending up overseas, given low inflation and CB tightening. If Chindian gold demand drops off then all our goldies will be wasted again.

Given all the capital inflows into OZ buying up our assets (or due to borrowings) plus the fact that Oz is connected economically to faster growing economies in Asia, its possible for the AUD to head higher - after all it peaked out at around USD1.10 when commodity prices were booming.

The response of the GDX, GDXJ, HUI have been anemic in the face of the recent recovery in the gold price. Not a good sign, but its not the end of the world so long as the gold price starts running in August. Perhaps our goldies will not do much in that rally?

loki