"American policymakers have exhausted fiscal and monetary policy remedies in their bid to cure the US economy’s growth blues, legendary inflation tamer Paul Volcker said.
The US was stuck in a “technical recovery”, growing at about 2 per cent a year, said Mr Volcker, who established his reputation when he killed off inflation in the early 1980s as chairman of the Federal Reserve Board.
“There is no magic bullet in fiscal or monetary policy. We have pretty much shot all the bullets we have,” Mr Volcker said. His downbeat remarks come as the Fed is under intense pressure to lower interest rates further by buying more bonds and extending their “near zero” guidance for the Fed’s overnight cash rate to 2015."
So, we all know that trading is all about timing. And we all know that the Euro debt can has only been kicked down the road a few weeks with promises of the ECB promising to print as many Euro's as necessary. And what Volcker is telling us is that the U.S. has no other option itself.
That monetary inflation is certain seems obvious to me. And gold will benefit immensely, not just for it's "safe haven", but for it's steady and accelerating appreciation in the market. The western nations will become poorer as their currency erodes due to expansion of their money supply, but only until they can no longer afford the cheap Chinese crap at Walmart, and when our exports balance our trade and account current with the rest of the world.
Gold and miners are moving on the basis of the USDX, and that moves with each speech or annoucement from one buearucrat or politian after another. Impossible to predict! So if we are to take on risk, the risk seems smaller in gold over the mid-term, so short-term plays in gold would then have less risk. Enough to take a position in these uncertain times? For me the risk of NOT being in gold or miners is far greater than in cash, but I may change my mind in an instant if the situation changes - which it will.
I read your post and wondered if you had been to the movies......just jokin'.....just jokin'.LOL. I knew better than to check this board, with it being so late. You have turned my mind to a song, which is not related to killing off inflation. I think others would be in favor of extinction, concerning that. Any way.....that real old song popped into my brain.....
Government has huge power these days and it can exercise this power longer than anyone around can stay solvent. It makes doom-and-gloom reason for gold prosperity (prosper because everything else down) limited, i.e. it does not take into account government ability to take gold down too or simply confiscate “windfall profits” if they ever appear in gold investment.
In my opinion, our success, as investors, is less global; i.e. we could succeed by investing in good stocks by buying low and sell high, while our chances to succeed because of global catastrophe are less transparent. This micro-approach assumes more emphasis on individual investor performance, due diligence, individual stock research, etc.; global trend could be helpful, but it will not help in case of, for example, poor stock selection or bad market timing.
" Enough to take a position in these uncertain times? For me the risk of NOT being in gold or miners is far greater than in cash, but I may change my mind in an instant if the situation changes - which it will."
All those words of wisdom ... killed off with one sentence ... lol!
Nothing like being a trader ... eh?
As you well know the more uncertain the markets the higher the risk, and the level of risk is estimated by considering multiple factors. Sometimes I'll post a view that hasn't solidified, it's like a juggler with several balls in the air. I hope that someone will add another bit of info that will make one side or the other appear more likely.
In reality, most people around are both in stocks and cash, and any recipes especially ones involving individual portfolio decisions (buy and sell) are hardly applicable for everyone, often including the source of the prediction. Certainly, we all have positions in PM stocks and, accordingly, we expect something good right around the corner. However, investment success can come gradually while any message board prediction is more time-specific, i.e. these two notions cannot be identical.
The US has spent $2 trillion in stimulus to no avail. Wasted funding that banks and corporate billionaires are hoarding. What we need is real stimulus to create jobs and move this economic engine.
Here's the best idea I've heard to solve the problem: for a mere (approx) $40B, the US Govt. could issue every American citizen over the age of 17 a check for a million dollars...a pittance compared to what they've already wasted on TARP, QE-1 and QE-2 and would jump-start this economy like nothing we've ever seen. Everyone would be spending like crazy. The jobs problem would be largely solved and we could get illegal aliens and other non-citizens to do the work we don't want. It's the kind of real stimulus this country needs, IMO. Giving money to bankers and big corporations hasn't solved anything. They just sit on the money and invest overseas.
Giving $1M check to every American older than 17 could mean $200-250T (200-250 trillions) in total spending. It’s a bit different from $40B number used in your message. Thank you for confirming your board idiot status and it’s not related exclusively to your inability to crunch numbers.