FWIW, my pick for 2010 was the Yuan, which is essentially the
clownbuck unless the Chinese de-peg. That is because the Fed
promised to reign in their emergency measures. Most were
already discontinued as of January, 31, but the Printing
is supposed to go away starting April. I also expect that
US economy will double dip into another recessionary
spiral once liquidity measures are
halted, not recover, probably in the second half of
the year, because recovery.gov "stimulus" is still running.
You can call me a deflationist, for now. I follow M3 for that,
effects of monetization vs debt defaults.
I expect that the Fed completely withdrawing from the debt
markets will put an upside pressure on interest rates, while
the housing demand will sharply tank once cash for shacks
program expires in late April and mortgage rate resets pick up
again.
As for gold, March is usually a start of a bad season that
ends in August, but it could as well run into May. Investors
are driving gold now, so it is hard to predict
what it will do. If we were on gold standard, it would triple
from 2008
Fundamentally the Fed printed more than enough for gold
to go much higher, they essentially tripled the base money.
I consider gold "money", and thus tied to the "base" sans
reserves. Moreover, the whole globe will be printing itself
out of bad loans, there is no other choice. That said, if
we go into recession again, there is high likelihood that
gold and commodities will tank. You can almost bet on that. |
