Thursday, August 12, 2010
This coming week will be very important as the US Fed meets to discuss interest rates. Chances are near 100% that they will remain in the current range but what is important is that they are likely to announce some sort of second quantitative easing program, adopting Buzz's phrase, only applying it to money printing.
Chances are, they will not make it quite so clear, but it's very likely that some sort of "program" or "initiative" will be announced. Then again, it seems everyone including the great US business channel is expecting this, so maybe it won't happen, or maybe it will, but they just won't tell us about it!
What has my antennae piqued though is that the great Giant Squid "bank" has lowered their US economic growth forecasts for 2011 and they are also predicting "another round of unconventional monetary easing".
It's uncanny how you can usually bet against this "bank" and win. They are known for saying one thing and doing the other, in turn screwing their clients or followers.....read on
Another brilliant article by Peter Souleles of Sydney:
Over 40 million people in the USA are reliant on food stamps yet in July men in suits paid 600 million sterling pounds for 240,100 tonnes of cocoa beans. Let the plebeians eat cake.
137,698 men and women filed for bankruptcy last month in the USA whist the average taxable bonus on Wall Street rose to $123,850 in 2009. Let them eat more cake.
Men in suits and with degrees argue whether we are headed for deflation or hyperinflation without understanding that the unemployed are doomed under either scenario. Let them eat cake as well.
A bankrupt US Government can borrow money for 10 years at 2.95% whilst struggling businesses seeking small commercial and industrial loans of about $500,000 were paying 3.5% more than the federal funds rate back in May according to the Fed's own data. And that's IF they could get the loan.......read in full
John Hathaway is interviewed on King World News about the effect political decisions can have on the gold price and the end game for fiat currencies. One of the best interviews ever conducted on King World News - a must listen........listen here
Although gold prices have slipped during the Northern Hemisphere summer, expectations are for a much stronger last quarter.
And, much of the reason for this is the difference between the type of person who has recently been selling the metal and those whose buying pushed up the price to its highs in June.
Speaking on Mineweb.com's Gold Weekly podcast, Jeff Nichols, MD of American Precious Metals Advisors, explains "The buyers have largely been buyers of physical products, small buyers, bullion coins and also to some extent, gold ETFs which are a form of physical gold investment as well. Much of this investment is sticky - it doesn't tend to get sold any time soon. It's long term holders, who have an affinity and interest in holding gold as a hedge an insurance policy and the like.
"The sellers on the other hand,""he says, have largely been institutional traders and speculators......"We're predicting or expecting that gold prices will in the next few years, hit $2,000 followed by $3,000 and possibly higher,".....read on