Friday, February 11, 2011

I've been a quiet Blogger of Late

As I just watch with a degree of amazement at what is going on in the world. As I've written before, it's an inconvenience for the average American family to have to pay more for a jar of Cheese Whiz than it is for a third world family to pay more for basic staples. In the third world, you can't adjust the size of a grain of rice, or a bean and give them less for more money but still make it feel like its's a value. Here, all kinds of packaging tricks have been used in an attempt to mask price rises, unless you look at unit prices, as I do. So the rising cost of buying enough food in third world countries to merely survive is quite a problem as we've witnessed in Eygpt. This will also manifest itself in other countries eventually leading to civil chaos and more governmental change.

So if you were planning to take a vacation in Pakistan, certain N. African countries, you'd better revise your reservations ASAP with Travelocity and get going.

There's talk in various circles on the web that China is aiming to raise gold reserves by another 5 tons in the near to medium term. I believe it. We are hurtling towards a new SDR scheme and being a gold power will be important, as I've said before. This is not necessarily in the best interest of the US, so this could be a drawn out affair. But clearly we're entering a period where the dollar's days are in quite a bit of trouble. I'm not going to pronounce U.S. Federal Reserve notes as dead, but a new reality is ahead. (how's that for positive spin?). If the SDR scheme works and the world reprices various assets differently, we COULD see a bit more stability enter the picture. Right now, the harsh reality is that many essential items are priced in volatile dollars. This has led to big moves higher in every thing from energy, metals and agriculture. Can a SDR scheme save the day? We'll watch for developments. I'm skeptical.

Ag remains a great place to be if you're a bull. Metals can only resume their upward climb. The pressure is building based on demand for gold and silver in China. Remember I talked about the Asian put? The US banksters and their accomplice exchanges no longer are in complete control of this game.

As for QE, it remains, Congress and its silly hearing notwithstanding. QE to infinity (orgininally penned by Jim Sinclair)? Believe it.

No comments: