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From Negative 5Y5Y To $2200 Gold?
For the first time on record (based on Bloomberg's data) 5-year / 5-year forward inflation expectations turned negative today. This kind of deflationary impulse has occurred twice in recent years and each time has been accompanied by dramatic Federal Reserve easing. The anticipation of the move by the Fed has caused Gold each time to surge higher on yet more expectations of the fiat-fiasco unwinding. Given the 5Y5Y inflation print currently, we would expect action from the Fed and one could argue that this would cause the price of Gold to rise to $2200 per ounce as the deleveraging continues.
The red arrows show the deflationary impulse (5Y5Y inflation is inverted) and the orange curve arrow shows the reaction function post Fed reaction to the blue arrow levels of the deflationary impulse.
Chart: Bloomberg
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Bob Chapman was indeed a good resource in these perilous times. He will indeed be missed by many of whom are awake and searching for answers, truth, and knowledge.
It seems that the Russians and Chinese could easily corner the silver market inc. all silver companies for about $1-2 Trillion AND corner the gold market inc. all gold companies for another $2-4 Trillion since China/Russia combined already have a majority stranglehold on the production of both PMs. Then they could demand whatever price they want for everything! The question is why don't they do it?
I imagine it could have something to do with the Amerika and NATO having bajillions of nuclear weapons, EMP's, HAARP, bio/chem and other thingamajigs we don't even know about.
Couple of spare Hubble+.
yeah, I read an article in the early 90's that the Hubble space telescope was built with sub-standard parts. Cutting corners is the "American way", well, let me posit that as the gov way in the DC beltway.
Yeah, why don't they? Are they afraid of something?
<--------Gold outperforms silver over the next 12 months
<--------Silver outperforms gold over the next 12 months
Consider roughly 50% of silver's demand is industrial vs. around 10% for gold.
For the first time on record. Or its happened twice before. Make up your mind.
Please reread the post. FIRST time negative expectations (the number is NEGATIVE)... THIRD time deflationary impulse (the number plunges lower) - simple eh?
What happens to all those zillions of dollars of derivatives if there is serious deflation?
yawn, still waiting
Hypothecated gold = lying about money.
What more harmless lie could be told?
Lack of Growth in Debt -- Asset Deflation...
Is the death knell of the Fiat Central Banker and his debt based money...
The Ponzi King is Dead... Long Live The Bernank...
BTW: "The reaction function"... Cue Bald Bennie is always behind the curve...
Previous USDX retracement & SPX rally warning is now confirmed & good (counter trend) equity upside expected.
http://www.zerohedge.com/news/2012-12-24/market-analysis
I like the way Paul Craig Roberts concludes the article:
Everyone wants a solution, so I will provide one. The US government should simply cancel the $230 trillion in derivative bets, declaring them null and void. As no real assets are involved, merely gambling on notional values, the only major effect of closing out or netting all the swaps (mostly over-the-counter contracts between counter-parties) would be to take $230 trillion of leveraged risk out of the financial system. The financial gangsters who want to continue enjoying betting gains while the public underwrites their losses would scream and yell about the sanctity of contracts. However, a government that can murder its own citizens or throw them into dungeons without due process can abolish all the contracts it wants in the name of national security. And most certainly, unlike the war on terror, purging the financial system of the gambling derivatives would vastly improve national security.
1776, .556, .308, and .45ACP are the only numbers worth betting on these days.