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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: ild who wrote (65270)	7/5/2006 11:19:17 AM
From: ild	Read Replies (1) of 110194

Date: Wed Jul 05 2006 10:20 trotsky (@Grandich) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved i'm sure nearly everybody here has read the recently widely circulated Grandich report urging everybody to get back in. here is what struck me as especially noteworthy: he mentioned that he continues to be less-than-bullish on base metals, because everybody else apparently is. so far so good, but then he proceeded to say ( in capital letters, and later repeated with exclamation marks ) 'the only party that doesn't know the US dollar is dead is the US dollar'. this strikes me as a very dollar BULLISH statement, though that wasn't the intention. after all, what is it saying, except 'everybody is bearish on the dollar, which in turn refuses to decline much'. by dint of Grandich's reasoning on base metals, he should be bullish on the dollar as well. so why isn't he? imo the reason is that dollar bullishness and gold bullishness are irreconcilable to him. so he has no choice but to hop on the fully loaded dollar bear wagon if he wants to be bullish on gold. just something to think about ( my personal opinion on the dollar is currently: short to medium term bullish, long term bearish. reason: the foreign CBs have printed a lot more money than the Fed over the past two years, but these roles will reverse once the US economy rolls over from the housing bubble implosion. also, the current surfeit of dollar bears argues for a rebound as well. lastly, one of the most important short term drivers are rate differentials, and those clearly favor the dollar at this stage ) .

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