WITH THE FED IN DEVALUATION MODE...EVERYTHING IS GOING UP...STOCKS, OIL, GOLD, SILVER, ETC ETC...
BUT STOCKS GO UP ON PROFITS OR AT LEAST STORIES ABOUT PROFITS REAL OR IMAGINED...
GOLD GOES UP SIMPLY BECAUSE OF MONEY PRINTING... SILVER IS A BIT OF A RETAIL MOMO PLAY PRESENTLY...AND OIL IS A BLEND OF MONEY WORRIES AND END DEMAND...
HERES THE PROBLEM...IF OIL GOES TOO HIGH...DEMAND FALLS...AND THE PRICE SHOULD GO DOWN... BUT CAN THE PRICE GO DOWN IF THE FED IS STILL DEVALUING THE DOLLAR...WITH MORE MONEY PRINTING...?
WE ARE IN A LONG TERM DEPRESSION...SO THERE IS NOT GOING TO BE ANOTHER BUBBLE BASED BOOM IN THE US ECONOMY... THE BEST THE FED CAN HOPE FOR IS STAGFLATION...
RISING PRICES...AND SLOW TO NO GROWTH... THAT IS THE MOST LIKELY SCENARIO....
SO AS STOCKS FALL ON FALLING PROFITS...THEY CAN GO UP ON THE WEAKER DOLLAR...
IN SHORT...THE YARD STICK IS GETTING SMALLER...SO EVERYTHING LOOKS...RELATIVELY...THE SAME...
BUT GOLD IS NOT DEPENDENT ON PROFITS...OR THE ECONOMY....RATHER GOLD IS SOLELY A FUNCTION OF THE MONEY SUPPLY AND THE CENTRAL BANKS MONEY PRINTING...
WHERE GOLD GETS HIT IS RELATIVE TO THE BOND MARKET...AS BOND YIELDS RISE...GOLD SHOULD GO DOWN AS INVESTORS SEEK A REAL YIELD...BUT HOW REAL IS THAT YIELD MEASURED IN DEVALUED DOLLARS...
NET NET...ITS CONFUSING...
BUT GOLD SEEMS TO BE THE SAFEST HAVEN FOR WHATEVER COMES NEXT...
