It has been a year since gold began its downward biased consolidation out of the acute phase of the Euro meltdown and resulting hysteria. In that time, the deflation case was released from the jail that had been a heightened public fear of inflation (the pinnacle of which was in spring of 2011, a time when bond king Bill Gross was very famously short long-term US Treasury bonds). Continue reading "Deflation: As Good As Gold?"
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Quick Take on USD
Global rally potential is all about arresting the deflation case for a counter trend expression of bullishness. Some of my inflationist friends will disagree, but I believe that the deflationary condition is the dominant backdrop (periodically fought by inflationary policy making) and that the admittedly valueless USD can see future upside.
There will be plenty more to write on this as the herds hiding in USD begin to come out and play with the asset market bulls. Because as usual, we’ll begin highlighting what might come next well ahead of time. Continue reading "Quick Take on USD"
Just another simple chart of a monetary relic
I see analysis popping up out there refuting the bearish Descending Triangle view and in my opinion that is with good reason; it looks a lot more like a massive consolidation of previous bullishness than a topping pattern.
However, a common theme seems to be some kind of static about a QE3 'Super Sunday' (don't hold your breath) or some such noise and gold's imminent and preordained blast off, never to return to current levels as the 'banksters' take it higher and higher.
A theme seems to be that now is the time to be bullish but I have also read within the same theme that we cannot be sure that the 'banksters' will not crash gold through support first, to totally eliminate the little guy before bringing it higher. Continue reading "Just another simple chart of a monetary relic"
Is 30.2.Au flying in Ben's face? Not yet
The FOMC announced that Operation Twist would continue through year end. This is where the Fed tries to re-inflate the housing bubble (and related areas) by buying long term T bonds to artificially hold down long term interest rates while sopping up any inflationary implications to the money supply by selling short term T bonds. Throw in a side of ZIRP, and you've got a lot of free money flying around out there with very subdued inflation effects.
Gold is in an orderly corrective consolidation. Silver has been hanging around at support and is sponsored by a bullish CoT structure. Commodities, even backing out the wildcards in agriculture, are in nice short-term bottoming patterns (copper is rounding upward and crude oil is breaking up from a small Inverted H&S with a target around 98) and just waiting for the Fed to lose control of the nice macro painting it has been working on since Op/Twist #1, back in September of 2011. Continue reading "Is 30.2.Au flying in Ben's face? Not yet"
Wall Street to the Rescue?
By Gary Tanashian
The story goes that our friends on Wall Street wink winked and nudge nudged with Alan Greenspan to cook up a massive bubble in credit and derived vehicles that eventually became malignant and spread toxic finance throughout the world. That is not a pretty picture.
Fast forward to summer, 2012 and we find Wall Street strategists wildly bullish on T bonds (in opposition to the Federal Reserve's desire to buy them) and seemingly standing in way of the great and powerful Fed's Twist operation. Are the Wall Street banks doing the public a service by showing the way to safety or are they simply holding up T bonds for the ransom of even higher prices than those denoted by today's record low interest rates? Continue reading "Wall Street to the Rescue?"
