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“War is Peace, Freedom is Slavery, Ignorance is Strength, and Debt is Recovery.”
Credits to Eric Blair and Andrew Gavin Marshall.
Wednesday 14 October 2009
1984 doublespeak headlines say one thing, market price dynamics tell us another.
$1065 gold tells us there may be no recovery, no U, no V, no W, but an X rated bi-economy, with the cost of living rising while productivity falls.
The financial system for our last three generations may be crumbling, not from the hot fires of deliberate inflation, but with the cold ice of deflationary default.
Big breakout capitulation days to modest new highs in markets may be an important time to protect one’s capital with strategic Trailing MOC Market on Close Stops worth more than speculative opinions, no matter how well reasoned.
Big4 33% short gold and 16.8% long gold do not bode well for gold calves who ignored gold at $255 in 1999 after a 19 year secular bear market. They may now rush in at nominal new highs where Angels fear to tread.
We all know $850 gold in 1980 was worth $2226.44 today per understated BLS.gov CPI calculator.
That means gold is actually in a real price downtrend like Real Estate and Stocks.
The USA suffered 84% dollar devaluation relative to gold since 2001.
American trading partners are mad. They subsidized US guns and butter off the sweat of wage slaves. They tried Euros, SDRs and Gold, but found out they do not work as well as the almighty dollar representing the world’s largest aging economy, four times aging China about to overtake aging Japan.
Euros Too big, SDRs not right, and Gold too small.
But where in the world is gold going after the Goldman Sachs $930 forecast six months ago?
