+2 Gold is pulling back, just like a lot of people (and countries--like China) have been waiting for. Silver is looking particularly appealing, especially as insurance against an economic collapse. With the US debt ceiling just being raised to $14.3 trillion to avoid US default, if you are not worried about the real possiblility of economic armageddon, you've got your head in the sand. The US might look good right now compared to the PIGGS (Portugal, Italy, Greece, Great Britain and Spain), but the full faith of the US government is not very reassuring to me.
We all know what drives the usd credit destruction and safety drive it up the efforts of its central bank to offset credit destruction and to ( indirectly ) finance the deficit drive it down its pretty telling when a non-problem like the euro deficits can cause this sort of liquidation, particularly in the commodity sector. the greeks have been using the emergency bce window for some time now and it is pretty probable spain and portugal will use it aswell ( banks buy the debt and use it at the bce window ... pay 1% and get paid 6% ... a no brainer? ). Sure, someone there ( a politician ) will close the lid before these people owe 1000% of their respective gdp's, but thats not really up to the market to decide ... all the market can do is kick yields and make a western european nation cds premia more expensive than that of indonesia ( wait ... lol? no seriously ... lol? ) its also very telling when the markets tries to antecipate a full stop to monetization when the fed will need to once again push the QE button ( indirect financing of a 3.8 trillion budget ) Sure these things will emerge as problems, serious if not catastrophic ones in the not so distant future, but for now, its just bluff and im willing to bet my left nutt on it So im bullish on the dollar long term, but in the near term, only after the scare has faded.
I would think the best thing that preserves value is land, it can not be renewed, will definitely go up long term.
I agree, as long as there is not a house or commercial property on it. Actually, farmland is already going up in price. Unfortunately, land is not a very liquid asset for us traders.
value is a perceived asset. May quickly vanish... I was expecting something like this to happen. Euro trash debt getting smacked simultaneously increasing the appeal US assets as "safe". Once this all boils over, people will question the USA's ability to service debts. If i were ben bernake and co i would be very nervous for ending their short term liquidity programs. How long until this? 3, 5, 10 years? It's coming, and i will be fading heavily into this trade. With the current admin's blind socialistic standpoints, coupled with serious global deleveraging, there is little hope for true prosperity.