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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (21468)	8/20/2007 8:06:38 PM
From: Amark$p	Read Replies (1) \| Respond to of 217561

also see comparison of TYX to IRX: stockcharts.com Yield spread between 30 Year T-Bond and 3-month T-Bill. If the yield ratio turns up and the real rate of interest is negative, then gold should fly... Thus, if Fed cuts rates, real interest goes down if inflation is stable... Moreover, remember US inflation uptick is cooked in already for this 4Q07: frontlinethoughts.com "If you look carefully at the CPI figures (and tinker with the monthly numbers), you'll also discover that even if the figures average a 2% annual rate in the months ahead, the year-over-year headline CPI inflation rate will be pushing 4% by November. This is already 'baked in the cake.' Since Bernanke is clearly concerned with the inflation expectations of the public, as well as the Fed's credibility, that headline CPI figure may create some complications for cutting rates in the months ahead, unless resource utilization falls out of bed." Thus with 4% inflation, REAL INTEREST rates will be close to negative in 4Q07.