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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: ggersh who wrote (1647)	10/19/2007 5:27:28 PM
From: Real Man	Read Replies (2) \| Respond to of 71456

Ah, 25 bp. is known, anything else would be a rumour. Gold did well today, considering the market dump. It should have been down, and it wasn't. Gold stocks are outperforming the spoos again.

To: ggersh who wrote (1647)	10/19/2007 6:00:05 PM
From: stockycd	Read Replies (1) \| Respond to of 71456

Gold is being held back partially by carry trade unwind similar to what happened in AUG. It's just not to the same extent. When he drops rates on the 31st, $800+++.s As an aside...I have been reading "A Demon of our own Design" by Richard Bookstaber. It gives an excellent history of the direct causes of the 1987 crash and other financial panics. One interesting observation is that during market panics/crashes, the correlation of markets is either 1 or -1. Specific markets are not influenced by events, data, news, ect. The only move in the same or opposite direction of the correlation. In other words, remember the market selloffs this summer, gold went down with it. Even if there would be news to melt the dollar or higher inflation news, it was completely ignored by the folks trading gold and the dollar. It went something like this: stock markets = tank, YEN = higher, dollar=higher, ST tres = higher, gold = lower, oil = lower. That was the trade, no variation. I am thinking that the next meltdown we have (that will be worse), gold will be inverse of what it was. My proposed correlations at the next crash will be as follows: stock markets = tank, YEN = higher, dollar = lower, ST tres = higher, gold = higher, oil = lower. Thanks for letting me think out loud. cd