Buy and Sell Signals, and Other Market Perspectives Message Board

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Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives

SPY 659.00

+1.0%

Nov 21 4:00 PM EST

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To: DebtBomb who wrote (5265)	6/6/2010 1:45:08 PM
From: Real Man	1 Recommendation Read Replies (3) of 219202

It's a bit different from 2007-2008. The concern is over govt. debt, and there are two ways out, devalue or default. The second is SHTF, while the first is gold-positive, obviously. We already did that. The money will exit debt supported assets, but it has to run into something while doing it. Gold seems to be a good candidate this time, it is not debt supported, especially if you get it in your pocket. The strength of gold should be appreciated, given the strength of the dollar. We'll see. Gold is special. Central banks hold it as a reserve asset. Now, there is a second property that gold has. It actually IS debt supported - there are a bunch of gold loans at low rates. But, when scared money runs into gold, it prefers physical. Thus, a squeeze develops, kinda like a bank run - physical gold gets bought and siphoned away, while creating the equivalent of a bank run, only in gold. Gold goes into stratosphere. That could easily happen as well. -g-

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