Everything will be bailed out, every state will be bailed out, all sovereign debt will be bailed out as quantitative easing goes to infinity. Gold will trade on this leg at $1650 - minimum and more than likely much more.
Jim
Obama Administration Backs $23B Bill to Save Teacher Jobs:
The Obama administration came out Thursday in support of emergency education funding legislation that would provide $23 billion to preserve teacher jobs in the face of massive impending layoffs across the country.
In the movie Toy Story, Buzz Lightyear's classic line before he attempts to take flight was "to infinite and beyond." I can't help but hear this line in Tim Allen's voice echo inside my head when see the endless queue of stimulus, bailouts, and subsidy programs, or what is commonly referred to as quantitative easing (QE).
I am no advocate of the harsh discipline imposed by the capital markets, but the policy of infinite QE is no free lunch. Devaluation, despite the appearance of an immediate solution, carries severe consequences in terms of standard of livings that will affect multiple generations. Compounding the problem is the reality that once the bailout path has been chosen, it’s becomes politically impossible to seek another route.
As Jim says, gold will seek $1650, but this will not be its final destination. The longer and farther we walk down the bailout path, the higher the price will go.
Gold, London P.M. Fixed:
Silver, London P.M. Fixed:
Source: abcnews.go.com
0 comments:
Post a Comment