To: Jacob Snyder who wrote (73549 ) 4/26/2011 8:13:35 AM From: carranza2 3 Recommendations Read Replies (1) | Respond to The combination of end of QE2 My thought is that Casey Research is exactly right, QE2 will end but that its replacement will follow eventually. The interim will provide opportunities. You are therefore wise to be in cash but perhaps not wise to be in USD. China saying they want to decrease dollar holdings Easier to say than to do as money on that level is not easily disposed of without some consequences. The Chinese are likely to increasingly use their excess reserves for infrastructure and to acquire resources. Their use of excess USD reserves is a kind of ersatz QE as it would of course decrease the value of the USD but it will also prop up whatever they do with the spent dollars. high oil prices, has moved me to 85% cash I really do think that getting out of stocks is very wise, but with the USD printing lows, and likely to continue doing so it is not a good long or mid term strategy, at least not with respect to oil and gold, which can protect you from the decline in purchasing power that holding USD [I assume you are in USD, maybe not] exposes you to. I prefer gold for this because its market is minuscule and the forces acting upon it are very powerful. The Swiss franc via FXF is a good vehicle if holding cash is the object. raw materials costs are rising Another reason to own gold for inflation is definitely spiking at a faster rate than interest rates are rising from a couple of years ago.
