“Woe to the land whose king is a child and whose leaders are already drunk in the morning. Happy the land whose king is a nobleman, and whose leaders work hard before they feast and drink, and then only to strengthen themselves for the tasks ahead”. (Eccl 10: 16-17)


"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat


In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people. Source – The Declaration of Independence

Thursday, September 13, 2012

Which One would You Want to Own???

Now that the Fed has made it abundantly clear that they intend to further debauch the US Dollar so as to keep Wall Street happy, watch for gold to once again begin outperforming against US Treasuries. Notice that each previous round of QE, has sent the yellow metal higher against the price of the long bond as the latter appropriately responds to an increase in inflation expectations by such activity.

Compared to previous QE's, this round is relatively modest by comparison as a $40 billion per month price tag still is less than $500 billion annually. Still, there is Operation Twist occuring alongside of this. Either way, I would expect the pattern to resume in favor of gold now that the deed is history.


Posted by at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)