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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum
GLD 368.29+0.6%Nov 7 4:00 PM EST
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To: elmatador who wrote (6735)5/24/2006 10:04:49 PM
From: THE ANT  Read Replies (4) of 217591
 
Wow,a bubbled US Stock Mkt,bubbled housing,bubbled dollar and the third world and commodities give.

Klasers take for what it is worth:Interest rates of 5% or 3% real rates are enough to slow the economy over the medium range.Still, housing mania and commodities mania make Fed threaten to raise rates and commodities and emerging mkts take the hit and put a hole in the housing mkt which begins to sink ever so slowly.Fed did not want to hit the emerging mkts as these mkts will be needed to pick up the slack when housing bubble slows,US dollar falls,and US consumer goes belly up.Also war on terror and idiots like Chavez and Morales require we not torpedo the emerging mkts.Thus Fed does not raise rates at next meeting

Now commodities including oil are in a speculative bubble and with the recent scare probably are on the ropes.They cant win in the short run.Fed is begging them"stay down dont make me do this to you again".Hopefully the fear alone will keep them down.I dont include gold here as this is not just a commodity.Average price of gold in the last 10 years is probably $350 an ounce.Fed has doubled money supply since 1999 so $700 gold is reasonable.Gold is probably up half what the real commodity metals are up.Other metals will continue to fall but gold will not fall by much.If it does it means the Fed has lost control and housing goes through the floor.Remember beter to have a falling currency and normalise world housing prices via that route than have US housing falling towards emerging world levels.

Anyhow, except for commodities,everything is headed in the wrong direction needed to rebalance the world, in the last week.Still thats OK as long as it punctures commodities and housing in the US.Then its interest rates down,dollar down,commodities down,gold up,emerging mkts up over the medium term
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