Tonight will be the last post until next weekend. It is vacation time! Try not to be too upset.
FED Meeting - Groundwork Laid for a Quarter Point
I saw on TV and in many articles all the talk of the FED coming to an end of their slash and burn rate cut rampage. Not only that, but many are even seriously convinced that the rate cuts did nothing to help the housing market! Well, welcome to clear thinking boys!
The FED will have their announcement on the 30th. 25bps, 50bps are the only two contenders here with no cut a remote possibility. How the markets react will be key to figuring how long the current rally will last. My guess is 25bps, with the rate then at 2% and a big market rally on the whole "the FED would only stop cutting if things were great!" idea. Poor kids.
Rebate Checks in the Mail
The whopping $600-$1200 rebate checks will begin arriving this week. Free money! Oh wait, the government is giving me money, which comes from......my own taxes? Not really free is it? Whatever.
Anyway, this is supposed to kick start spending. Like most things from this administration, just spending money and acting like everything is great will not work. I cannot understand why the government just did not give the entire stimulus plan money directly to the companies in the DOW and S&P and sidestep the whole consumer angle. Like most things, they always do it the hard way!
Have a good week.
.....hahahah You go on vacation and more drops in rates and more drops in metals.... what the heck is going on here....
ReplyDeleteany takers?
Thoughts ?
G
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ReplyDeleteDollar is rallying, I think 75 on the index is minimum upside. Gold has a chance to break 800, If it does I'll start buying at 760, silver I still think is going to 14.5 but could go all the way to 12. One also needs to consider seasonality as metals usually bottom around August. I'm not in any hurry to add to my positions or sell either.
More Snow here, looks like we could get up to 6". Gotta be an end to this soon I would hope.
Kevin
What frustrates me is the fact that nothing has changed and the fed even cut the discount rate. I got a bad feeling here after reading a few other articles about the U.S. ever getting out of the debt hole. Most people interpret my disdain for the dollar and lust for metals as superficial. I am only gravitating towards what's holding value in the face of massive monetary re-inflation. The investment firms should have been left out to dry and rates should never be this low. The government is expending when we need smaller footprint and the military is just eating itself up on a daily basis. Not to mention deficit spending that could make a space elevator to the moon.
ReplyDeleteI am with you though on buying more if it drops down some more.
And finally $115+ for oil and holding doesn't bode well for anyone with a car and a commute.
I can't wait to see what our great leader posts when he gets back from vacation :)
G
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ReplyDeleteYou are correct, Absolutely nothing has changed fundamentally, the US is bankrupt and I think the dollar is toast but that doesn't mean that the metals can't have a good hard shake out. They went to far to fast and I think it would be healthy in the longer term. The Yen carry trade has been put back on and this is what is driving equities for now. Dollar up - gold down.
Kevin
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