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

To: Real Man who wrote (14454)	11/13/2008 6:16:09 PM
From: gregor_us	5 Recommendations Respond to of 71410

Today was a very important day. But not because stocks went up. No, it was the long-bond auction which went poorly. My view is that the FED and global authorities have tried everything for over a year to reflate the system. But capital never stopped herding into cash, and treasuries. That's when I started to wonder if a bad auction, or a series of auctions, would be the trigger that signaled reflation was finally taking hold. After all, the lever in all reflations is to make holding cash and government bonds uncomfortable. I think we have been getting close to that point for some time, but today it seemed to trigger. when bonds and commodities collide: gregor.us I continue to marvel that the inflation which has been the trend for the entire decade has been rejected (emotionally) by nearly all market observers on the basis of 4 months of severe downward price action. OK. Emotionally, I can understand that. But my "head" has been telling me this is a counter-trend move--though a mighty, ferocious one at that. Can't help think how this move since July functioned to 1. Herd capital all over the world into government bonds and cash into the banking system, 2. Allowed central bankers to capitulate to "deflation" and say they had once again killed the inflation dragon. This has ushered in truly historic rate cuts, fiscal stim, and know Brown of the UK has been talking about "global tax cuts." G