several enlightened people are expecting advent of inflation
or I mean, price inflation
since inflation has been monumental for three full years now
in July 2003, the bond market slammed its fist in the Fed's face, declaring as only it can that the loose monetary policy has gone far enough, that financial leverage has gone far enough, that agency hedging has gone far enough
yet by January 2004, we have continued accommodative Fed monetary policy, with only a bone tossed on bias, citing balanced inflation and deflation risks
I believe price inflation will soon be significant and in several key quarters
by significant I mean climbing toward 4%
enough to provide another shock to the bond market
of course, pricing power on finished goods will be kept under foot
rather, I refer to services, production costs, energy costs, and much more
I still maintain that this 3-yr TNX chart indicates higher longterm interest rates
this is a clear upward biased Head & Shoulders bull pattern
it indicates LT rates are heading to 5.5% in the next several months
the right shoulder is about complete
time for the jump very soon, like weeks
notice the stochastix, about to show a crossover upturn from a low level
the 50day MA is trending up also
enough of this secular price deflation bullshit
it will be interrupted by a spate of 2-3 years of price inflation
the Fed cannot get away with such rampant monetary largesse
that should kill bonds, kill the US$, kill housing, kill consumerism, and lift gold
THAT IS THE SHOCK BY MID-2004
stockcharts.com[h,a]waclyyay[de][pb50!d20,2!f][vc60][iUb14!Uh15,5,5]&pref=G
/ jim |
