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One wonders at what point this starts to become a crowded trade...at least temporarily. Certainly it would not be unexpected for the Fed and Treasury to engineer a ramp up in the US $ [for no other reason than to dampen the animal spirits in the oil markets], which should shake out the growing number of weak hands that are long gold.
One wonders at what point this starts to become a crowded trade...at least temporarily. Certainly it would not be unexpected for the Fed and Treasury to engineer a ramp up in the US $ [for no other reason than to dampen the animal spirits in the oil markets], which should shake out the growing number of weak hands that are long gold.
i would guess that the ecb would be the most ardent supporter of a dollar rally. it's hard to see a dollar rally happening, however, in the absence of a flight from risk assets, so i'm less sure about the fed and treasury. be careful what you wish for....
i would guess that the ecb would be the most ardent supporter of a dollar rally. it's hard to see a dollar rally happening, however, in the absence of a flight from risk assets, so i'm less sure about the fed and treasury. be careful what you wish for....
“Nouriel Roubini, the economist who predicted the global economic crisis, said a forecast by investor Jim Rogers that gold will double to at least $2,000 an ounce is ‘utter nonsense’.
“Maybe it will reach $1,100 or so but $1,500 or $2,000 is nonsense,” Roubini said. Gold rose to a record $1,098.50 today in New York on speculation that central banks and investors will purchase the metal to hedge against a declining dollar.
Rogers, who predicted the start of the commodities rally in 1999, said in an interview on Bloomberg Television today that Roubini is wrong about the threat of bubbles in gold and emerging-markets stocks. The price of gold will double in the next decade, he said.
In his New York speech, Roubini repeated his assertion that asset prices have risen “too much, too soon, too fast.” He’s a New York University professor and chairman of New York research and advisory firm Roubini Global Economics.
Jim 69 y/o
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As of today, I will be long in dollars,” said Faber.
there's nowhere to follow me, as i didn't predict anything. i just said that a dollar rally - if it occurs - will likely be in the context of a flight from risk. i'm quite open to that possibility, though i don't have faber's courage to predict both its occurrence and its timing so definitively. [and i'm 44% in dollars- 26% cash, 18% tlt]
i would guess that the ecb would be the most ardent supporter of a dollar rally. it's hard to see a dollar rally happening, however, in the absence of a flight from risk assets, so i'm less sure about the fed and treasury. be careful what you wish for....
Recently I spent a few days in Central London and posted, on another thread, my amazement at the activity level there. Seemed that nothing much had changed...almost as though the financial crisis had not happened, that there were no British banks in trouble, etc.
I attributed that to the seemingly rapid return of the bonus culture to the City and Mayfair hedge funds.
On further reflection, I think another, perhaps more important factor is the significant fall of the British Pound against the Euro and other currencies, including the US Dollar. Central London thrives on foreign visitors and wealthy expat residents [who are taxed very lightly on non-UK income] and, unlike Continental Europe, it has become "cheap" if you are paying in Euros, Swissie, Aussie Dollars or Loonies. Although not quite as much as these other currencies, it has also become cheaper than it used to be even if you are paying in US Dollars [how many other places in the world can you say that ].
If British politics, banks and the economy weren't such a basket case I might be tempted to go long the Pound instead of the Dollar...:eek:
So I would agree with you that the ECB would be "the most ardent supporter of a dollar rally" [and a Pound rally too]. The reasons I think the stars may align and give us that outcome is the Fed and Treasury having to dampen animal spirits in the risk markets to:
attract more capital to the "risk-free" Treasury market where they have to sell a lot of product and want to keep rates low;
"show the world" [other Central Banks] they have not completely abandoned their responsibility to maintain the value of the Dollar;
try to offset the inevitable negative US$ reaction to any further fiscal stimulus measures announced to address [politically] the deteriorating employment situation; and
to smack oil, gold and other hard asset "inflation" indicators to maintain the fiction of "deflation" concerns, which is essential to maintain support for ZIRP and delay as long as possible the dreaded and risky "exit" strategy implimentation.
All this merely buys more time, while they desperately hope for the private sector to kick in and give us the elusive self-sustaining recovery.
This past week BNN interviewed one of the bloggers that attended an invitation meeting with Treasury officials, including Geithner. When asked what he thought was the biggest concern that Treasury had, he replied that they are worried that the recovery is not "catching hold"...:p
Indeed, last month, Harrods, the 160-year-old London department store, began selling coins as well as gold bullion ranging from tiny 1-gram ingots to the hefty, 12.5-kilogram, 400-Troy-ounce bricks that are so often featured in movies and stocked inside the vaults of Fort Knox. Harrods’s lower ground floor, where the gold is peddled, has been packed with interested shoppers.
“The response has been astounding,” said Chris Hall, head of Harrods Gold Bullion. “Bars are definitely more popular than coins. The 100-gram is the most popular.”
IN the United States, ads promising high prices for gold are regular fodder for late-night television spots, while buyers are setting up tables at shopping malls or hosting gold-buying gatherings at private homes — like recession-era Tupperware parties.
“Gold’s appeal has broadened,” added Ms. Cooper, who predicts that it will hit $1,140 an ounce by the second quarter of next year.
Ms. Cooper going way out on a limb there. What a prediction.
“I have never been a gold bug,” Paul Tudor Jones, the prominent hedge fund manager, told his investors last month. “It is just an asset that, like everything else in life, has its time and place. And now is that time.”
Stocks may have already peaked for this year and might drop 20 percent amid renewed deflation fears, said Marc Faber, the publisher of the Gloom, Boom & Doom report.
The dollar is likely to rebound from an “oversold” position, which will be negative for equities, Faber said in an interview with Bloomberg Television on the sidelines of CLSA’s annual investor conference in Hong Kong.
“I wouldn’t be surprised if we had seen the peak of the market for this year because the economic news isn’t going to improve very much,” Faber, 63, said. “The correction in the market has been overdue for quite some time.
Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world. Dr. Doom also trades currencies and commodity futures like Gold and Oil.
What Gold Bubble? - Janszen - iTulip.com
9 posts - 9 authors - Last post: Oct 6, 2006
I figure Friday the 13th is as good a day as any to take on everyone who insists on calling the price action in gold earlier this year a ...
[PDF] iTulip.com Gold Price Myths Cheat Sheet
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Sep 10, 2009 ... Here are eight popular myths about gold that we have collected since .... iTulip.com Position: The price of gold began to rise after the ...
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