Sunday Gold Fix – Inventory Paradox
The physical markets for precious metals do operate under the philosophical framework of basic economics. The price of gold, for example, will move based on underlying demand and supply dynamics though it appears to have taken a break from that relationship recently. Unlike industrial commodities, however, gold still occupies monetary spheres, particularly interbank liquidity. That .. read more
Deja Vu All Over Again?
Gold dropped 20%. Oil dropped over 10%. The Goldman Sachs Commodity Index dropped 11%. The US Dollar rose. Last week? No, that’s what happened in the first week of July of 2008. Last week’s rout in the commodities markets was eerily similar to that week nearly 5 years ago when the first signs of the .. read more
Pot Meets Kettle
Late Friday the Treasury Department released its semi-annual report on global exchange rates or as I like to call it, the semi-annual report on why all other countries on planet earth should let their currencies rise against the UD Dollar. Or maybe the semi-annual report on how easy monetary policy by other countries’ central banks .. read more
We’re All Monetarists Now
Japan last week announced a radical plan to finally slay the deflation dragon that has stalked their economy for the last 25 years. The sheer magnitude of the BOJ’s program should put to rest once and for all whether monetary policy can truly work as the growth tonic that policy wonks such as Ben Bernanke .. read more
Market Observations
The market is a very confusing place right now and there are a lot of cross currents to decipher. I spent the afternoon perusing a lot of charts in the hopes of finding some clarity. I do this about once a week – I look at charts everyday but once a week I sit down .. read more
Goldilocks Or The Big Bad Bear?
Once upon a time in a commentary long, long ago I said that we’d know the US economy was on the right track when we saw three conditions simultaneously: rising stocks, a rising dollar and a falling gold price. Those three conditions – sustained – would indicate that the market is anticipating better growth and .. read more
Batten Down The Hatches
Back in November I wrote a weekly commentary that I called Looking For Silver Linings. The market had been taking a beating in the post election period and I wasn’t feeling particularly good about my forecasting skills. I had written a commentary just two weeks before arguing that the election really didn’t matter that much .. read more
Markets & Economy Update
The sentiment regarding US stocks has recently gotten even more bullish and while our longer term outlook is fairly bullish, it is hard to maintain that stance in the short term. The AAII weekly poll now has bulls at 46.5%, bears at 26.9% and fence sitters at 26.6%. While that isn’t enough to send me .. read more
