Looks like I was onto something when I said the bottom seemed to be in. Here’s today:
Pretty clear signal?
Two things happened today :
- Anticipation of more money-printing to debase us all to prosperity
- The realization that when the S hits the F, gold will be the safe haven once again
If this is the third large wave up we have been waiting for (the second beginning late 08/early 09 and lasting up to $1900), then there is some serious money to be made. This, of course, depends on the stupidity of central bankers. Will they let that which must collapse collapse? Or will they keep propping up insolvent banks and states. The gold bet means the later. Rumours are flying wide on what might be next. Pan-european bank-bailout-fund? More Federal Reserve liquidity? Or just more hot-air until the world economy gets even worse? Look at what bonds and commodities are doing. I lost a chunk of money yet again on shorting US Treasuries (exited position before the last wave up started). And yet, US stocks haven’t fallen that far. Why not? Someone is going to save them, people seem to think. More liquid heroin for the masses.
The thing is this – nothing has improved materially since ’08. Old problems have been replaced with new, bigger ones. At one point we will have to bite the bullet. And its getting worse for each day that passes. They can inflate, inflate and inflate, but no matter what, the end is always a financial collapse, the only question is how much currencies are destroyed first.
Watch out for volatility as well. Look at Switzerland and Japan for currency crazyness. Look at China for an epic collapse. And look at the PIIGS to see where everyone who cannot live within their means are headed.
Looks like we are about to shift into yet another phase of centrally managed insanity. Hold on to your hats.
“They can inflate, inflate and inflate, but no matter what, the end is always a financial collapse, the only question is how much currencies are destroyed first.”
That’s exactly right. And, in one of the weirder twists of irony, the dollar, at least temporarily, is like to be identified (absurdly) as a safe haven, and grossly overvalued. Although I wish the coming events weren’t coming to pass so soon, these weeks, months (and possibly years) should be used to position ourselves in *true* safe havens. Certainly PMs are one of those, but I also look to undervalued real estate & undeveloped land.