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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: rubed who wrote (9753)	3/8/2004 7:45:52 PM
From: NOW	Respond to of 110194

that is the rub all right....

To: rubed who wrote (9753)	3/8/2004 8:06:39 PM
From: russwinter	Respond to of 110194

<does gold take off because the market assumes AG will have to leave rates low, or does it get hammered because the market assumes AG will have to hike?> The general question du jour here, start reading about half the last several thousand posts <g>. Mish, will tell you they will freeze on rates, no matter what, because of their fixation on "jobs". I've been saying they must act in an aggressive way. I still think they will respond in a half assed manner, and at this point that would still lead to a crack-up boom (skyrocketing commodities, including gold): question of degree. I actually now think the Fed will have to increase even more aggressively now to offset the rampant inflation coming out of the BOJ . My SWAG to do the job and prevent a crack up boom: about 350 bps over three months.

To: rubed who wrote (9753)	3/8/2004 8:50:36 PM
From: mishedlo	Read Replies (1) \| Respond to of 110194

Well I have a question then: When we get the PPI numbers (and I am assuming they show a hefty increase no matter how they skew them), does gold take off because the market assumes AG will have to leave rates low, or does it get hammered because the market assumes AG will have to hike? Opinions appreciated. rube It is very hard to say SHORT TERM. Longer term PPI or not, the FED is NOT hiking without jobs. PERIOD. Gold will follow the US$ and the next move from Europe is a cut. I think that is 2 months away perhaps 3. In the meantime gold looks good to go. In a PPI smackdown I can see gold getting hit for a day or two, or possibly not at all. After Europe cuts, gold gets smacked for the final time, then takes off. That is my theory and how I am playing it as well. Adding another gold call in the AM. Gold 430-450 in 3 months would not surprise me at all. Mish