Why would anybody continue to buy the Dollar? Any day now you'll be able to stand outside of a bank with a pillow case and catch them for free as they fall from the helicopter overhead. Unlimited Dollars available at negative interest rates, damn...that's better than free money. Excuse me while I pause here to make a shopping list...
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...hmmm, the only thing I have on this list is Gold and Silver. I hope I can find some.
Bull Market Reset
Right now, the dollar is looking strong because of the massive repatriation of U.S. dollars now underway as a result of global U.S. denominated asset de-leveraging. So it looks like the dollar is strengthening. This is however a temporary illusion, and the fact is that this is a perfect opportunity to unload U.S. dollars and everything denominated in same. When the export of dollars to the U.S. eases, the greenback will plunge.
As all of the world’s currencies weaken in tandem with the U.S., since they are all tied to some degree to that ailing foreign reserve standard, gold will slowly at first, and then suddenly, surge into new record territory. These are the events that have irrevocably set the stage for $2,000 gold, and though many skeptics may marvel at the audaciousness of this sentiment still being echoed after all these years, it is now imminent and definite.
So the first great opportunity presented by this crisis, besides the last minute premium available for USD, is in physical gold. Not only is this the best strategy for capital preservation versus holding cash, it’s the next great opportunity to buy low and sell high.
http://news.goldseek.com/GoldSeek/1224001438.php
http://news.goldseek.com/GoldSeek/1224001438.php
Equity rally to pop the bond bubble, buy precious metals
The US bond market was closed yesterday for Columbus Day, while US stocks enjoyed their biggest rally since the stock market crash in 1929. That ought to be enough to caution anybody who thinks the problems are over in capital markets - after the 1929 rally markets lurched lower for several years.
However, the record equity rally is not going to be good news for the bond market as it returns from holiday. ...the US bond market has formed a double top in its charts and is dangerously overbought. It is another bubble set to crash.
With equity prices up an equally massive sell off in the bond market is therefore about to happen, precipitating another crisis. How will governments fund their massive bank bailouts if the bond market ceases to function?
For when investors suffer huge losses on bonds today they are hardly likely to want to buy new government debt, unless it carries a much higher coupon payment. That means interest rates will have to go up at a time when the world is facing a recession, probably its worst in a generation or two. That will make the recession deeper and longer.
I am afraid that will be a double-whammy for investors and yesterday’s rally in equities will prove a sucker’s rally as bond holders will sell at depressed prices and then have to cover their margin calls by selling equities again. This is a downward spiral.
With bonds no longer a safe haven then only gold and silver will be left - expect a rally in precious metals of unbelievable proportions... http://news.goldseek.com/GoldSeek/1223998200.php
Stocks turn lower as profit-taking sets in
NEW YORK (AP) — Wall Street turned lower Tuesday as investors were pleased with the government's plans to spend $250 billion to buy stock in private banks but still collected profits from the previous day's massive advance.
Profit-taking started creeping into the market after the Dow surged more than 400 points at the opening, and it was expected that some investors would take some money out of the market after such a massive gain. Moreover, it was anticipated that Wall Street would continue to see jittery trading in the weeks and perhaps months ahead because of worries about the weak economy.
"We don't know if the bottom is in," said Lincoln Anderson, chief investment officer and chief economist at LPL Financial in Boston, referring to the market's advance Monday after huge losses last week. "We certainly expect heightened volatility for a fair amount of time while we sort out just exactly what's going on."
"The tone is cautious," Anderson said. "I don't think anybody is pile driving into the market and doubling up."
The revised bailout plan differs from the original in that it aims to recapitalize banks, not just buy the troubled assets off their books at prices that could leave the banks with losses.
"This begins to penetrate the core of the problem," said Peter Cardillo, chief market economist at New York-based brokerage house Avalon Partners Inc.
But, he said, "there will be a point in time where the euphoria of the bailout plan begins to wear off and the market begins to face reality. And that reality is likely to be a sour earnings season, and that the economy is in recession."
Ah, but... Always beware of the "but". This isn't profit taking. This is the smart money hitting the road with the dumb money's cash. Another "bailout", another euphoric rush, another crash. Sounds like a drug addiction to me. Except this is an addiction to debt. Seriously, consider the difficulty in weening a loved one off of a drug or alcohol addiction. Is giving them more of their vice going to break their habit? NO! Of course not. Is throwing more cheap money at, and creating more debt going to fix a debt addiction? LOOOOOOOOOOL! I rest my case...
CFTC 'looking into' gold market as well as silver
Dear Friend of GATA and Gold:
Commissioner Bart Chilton of the U.S. Commodity Futures Trading Commission, who has been amazingly conscientious and cordial in correspondence with many GATA supporters, told two of them by e-mail today that the commission is not only investigating the silver market, which was announced on September 25 (http://www.gata.org/node/6672), but is "alsolooking at other markets, including the gold market, as part of our ongoing efforts."
Commissioner Bart Chilton of the U.S. Commodity Futures Trading Commission, who has been amazingly conscientious and cordial in correspondence with many GATA supporters, told two of them by e-mail today that the commission is not only investigating the silver market, which was announced on September 25 (http://www.gata.org/node/6672), but is "alsolooking at other markets, including the gold market, as part of our ongoing efforts."
Since Chilton is associated with producing interests, farm interests (http://www.cftc.gov/aboutthecftc/commissioners/bchilton.html), he may be expected to be more skeptical of financial/manipulative interests than other CFTC commissioners. And since he is a member of the commission's Democratic minority, he may have less influence than commissioners allied with financial interests. But our side plainly has gotten his attention and that of his agency, and everyone who has agitated with the CFTC should feel good about that.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
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