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Strategies & Market Trends : Waiting for the big Kahuna

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To: GROUND ZERO™ who wrote (31869)	10/18/1998 10:07:00 AM
From: Haim R. Branisteanu	Read Replies (3) of 94695

<<<If capital is disappearing and recession is on the horizon, then how can the CRB and gold rise in price, except for a weaker dollar, unless you're saying that inflation is about to emerge?>> GZ, the FED recognized that we are in a deflationary period and economic slowdown. To avert such developments which will bring us to a deep and prolonged recession, the FED is trying to inflate and chose the stagflation pasture if possible to gain some time. Stagflation inevitabely will lower financial assets in the long term and rise commodity prices. Both in the interest of the US. Why?? Most of the countries in the world in deep recession or depression are rich in natural resources and a move upwards will improve their balance sheet. Second the US today is the biggest grain exporter, a lower dollar will help the US farmers much more than bugetary spending. If the US FED will be able to manuver this phase we will be out of the problems by 2000, with a weaker dollar, lower stock market but strong economy. As for gold they will try to keep it down as it is perceived as an inflationary signal. (speaking of FED manipulation) BWDIK Haim

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