to the truly observant that have been following this thread and what i have been saying, its clearly obvious that all markets including pm's are moving inversely to the USD almost on a tick for tick basis. this is the inverse correlation i have been talking about. IMO this means the USD is the dog and all other markets including gold are the tails.
this is also a very dangerous situation as the fundamentals of individual companies or markets don't really matter. in fact, the inherent value of gold/silver doesn't matter either. if the the USD decides to skyrocket, gold/silver will tank along with everything else and vice versa.
we're due for a correction in markets so you know what i think.
Yes. Usually "safer" assets like gold and gov bonds were (more or less) correlated and at the same time inversely correlated to "riskier" assets like stocks. But now everything is almost inversely correlated to the dollar and derivated assets. Its because the market is speculating on the survival of the dollar, and anything else serves as a way to scape the dollar.
Btw, the mainstream media has not commented on this piece of news: The Russian central bank has started to offer gold backed loans:
http://af.reuters.com/article/metalsNews/idAFL5E7JQ0Q020110826For the people that believe that the government is going to let deflation happen, I really want to know: why? why would they want to let deflation happen and force them to default when they can monetize the debt and keep spending? Also, letting deflation happen would bankrupt the banks and until now politicians have done everything in their hands for the survivial of the big banks. Why would the government let their own default happen and let the big banks go broke when they can avoid it by monetizing debt? I dont understand the deflationist position.
EDIT: Im talking mid and long term. I have stated before that we are going to see a lot of volatitility in the next years with recurrent deflationary mini-crashes like the present one. But the trend is inflationary.