Loading ...The stock market opened today 50 points higher going vertical to the moon. One would think that this is a good thing, but we are not so sure about that. Seems like inflation (or dollar deflation) was behind the move this morning. The dollar is falling virtually against every country and is at historically low vales. Gold has moved firmly above 1000 an ounce hitting 1021 this AM. However, something tells me that the DJI rally is fading.
No one can say for certain what the market will do the next 2 years. If US government decides to prop up the market with its easy money policy of ultra low rates while continuously devaluating the dollar, the sky is the limit (hyperinflation). If US government starts to remove the safety net, break up the too big to fail financial institutes and end the parasite that is Goldman Sachs (depression). For long term stability and prosperity sake, government should do the second option. But considering that we have become controlled by short term thinkers, we will most likely do the first option. That is exactly what the market is banking on, runaway inflation to support asset prices. The only clear safe bet is short the British pound while going long the Euro.
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