Gold's
five year bull market has been quite powerful and yet Joe Public
remains rooted in convention. The pig, er, Dow is in
auto-levitation mode yet again, and tech stocks are leading the
paper rally. Nope, no problems what so ever in mainstream
finance. While we expect the metal to encounter some
turbulence here around the psych-500 mark, it is also expected to
shine a light of truth upon the broad markets every step of the way,
and that truth is that assets are rising in an inflationary impulse
through debt and currency debasement and folks, that ain't healthy
no matter how much spin CNBC puts on it.
See
what we mean? Dow measured in gold shows a rather limp
"bull" market. This farce would be laughable if so
many people weren't going to be hurt by it simply because they
believed conventional financial establishment sources that make
their living forcing more and more paper down people's throats and
more and more risk into their portfolios.
We
warned perma-bears about 500 points ago that this was likely to
happen. If you're going to make continued attempts to short
this mess, at least do so while maintaining a long position in gold.
We are in uncharted territory here with inflation our primary
national product. How does one quantify that and turn it into
a reliable timing signal to short? With Dr. Bernanke at the
Fed helm, we may go even further out on the limb of this economic
experiment. How about if we narrow it down to a target for the
next 3 years? Say, Dow 3,000 to Dow 15,000? And if
hyperinflation is in the offing, get ready for that Dow 36,000 that
the "bubbleonians" and new paradigmers predict. But
all those stocks will be denominated in a worthless currency, so
it's all really just a zero sum game, isn't it?
But
Bernanke can only fulfill his raison d'ętre against a backdrop of
contracting liquidity, so don't rule out a deflation scare first.
Confusing, isn't it? Dow 3000 or Dow 36,000? This is the
kind of discord that makes perfect sense in a remotely managed
economic system.
Protect
yourself.
