CLEARLY THE EASY MONEY FOREVER POLICY AT THE FED IS CREATING MORE THAN A WHIFF OF INFLATION....
IF BERNANKE EVER...EVER...DECIDES THAT MONEY IS NOT WORTHLESS...AND THAT EVEN "BERNANKE BUCKS" HAVE SOME VALUE...
AND IF THAT CAUSES HIM TO GIVE US "AN INTEREST RATE"...
NO...ZERO IS NOT A RATE...ITS THE ABSENCE OF A RATE...!
IF WE SHOULD GO TO 1/4 OR 1/2 PERCENT ON FED FUNDS...
WATCH GOLD... WILL IT PLUNGE...RISE OR ...PLUNGE THEN RISE...?
MY HUNCH IS THE LATTER...PLUNGE THEN RISE...
BECAUSE EVERONE "KNOWS" THAT ONE RATE HIKE MEANS MORE ARE COMING...AND THAT COULD CAUSE A QUICK SELL OFF IN GOLD...AS BANK RATES WOULD GO UP AS AN ALTERNATIVE TO STOCKS...
BUT WHAT ABOUT THE BOND MARKET...!!
BERNANKE MAY HAVE PAINTED HIMSELF INTO A CORNER ON BONDS...
SIMPLY PUT...A 5% 30 YEAR BOND WOULD BANKRUPT THE WORLD NOW...!
BUT LIKE IN THE 70'S...THERE MAY BE NO OTHER CHOICE...!
IF BERNANKE EVER...EVER...DECIDES THAT MONEY IS NOT WORTHLESS...AND THAT EVEN "BERNANKE BUCKS" HAVE SOME VALUE...
AND IF THAT CAUSES HIM TO GIVE US "AN INTEREST RATE"...
NO...ZERO IS NOT A RATE...ITS THE ABSENCE OF A RATE...!
IF WE SHOULD GO TO 1/4 OR 1/2 PERCENT ON FED FUNDS...
WATCH GOLD... WILL IT PLUNGE...RISE OR ...PLUNGE THEN RISE...?
MY HUNCH IS THE LATTER...PLUNGE THEN RISE...
BECAUSE EVERONE "KNOWS" THAT ONE RATE HIKE MEANS MORE ARE COMING...AND THAT COULD CAUSE A QUICK SELL OFF IN GOLD...AS BANK RATES WOULD GO UP AS AN ALTERNATIVE TO STOCKS...
BUT WHAT ABOUT THE BOND MARKET...!!
BERNANKE MAY HAVE PAINTED HIMSELF INTO A CORNER ON BONDS...
SIMPLY PUT...A 5% 30 YEAR BOND WOULD BANKRUPT THE WORLD NOW...!
BUT LIKE IN THE 70'S...THERE MAY BE NO OTHER CHOICE...!
