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Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives
SPY 670.92+0.1%Nov 7 4:00 PM EST
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To: GROUND ZERO™ who wrote (53657)8/16/2013 10:25:05 AM
From: Hawkmoon1 Recommendation

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If "deflation is looming even stronger," then how come gold is rallying now? TIA

Good question.. Could be the market is taking it as a signal that the Fed will be forced to continue QE for the foreseeable future.

All I can see is that if WMT, as a discount retailer, is having trouble meeting it's revenue and profit projections, when they should be prospering due to bad economic times, they are being forced to cut prices even more because of a destitute, debt-ridden, consumer.

I read that WMT makes up 10% of all non-automotive related retail. That's a significant percentage.. IMO..

If they can't do well, then it doesn't bode good for the rest of the economy, which depends upon discretionary spending.

So maybe the Gold markets are seeing it as an indicator that the Fed will continue it's money printing.. But the question is whether the Fed can "pump" enough monetary "wind" through the economic windsock to keep it inflated and directed in the way they want it to go...

Or is Deflation taking control, requiring even more (wasted) effort from the Fed?

Sometimes it's just hard to keep a leaking tire inflated, no matter how much air we pump into it..

Hawk
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