2020 will go down as the year that the New World Order (NWO for short), after many years of building up to it, declared full on war against the rest of humanity, and since this war kicked off with an unprecedented “shock and awe” campaign it definitely got off to a flying start.
As financial markets gyrated this week, Federal Reserve chairman Jerome Powell touted the U.S. dollar as a form of “sound money.” More on that incredible take in a moment.
This “battle” is important. From 1966 to 1997 inflation was the primary driver of the markets. In general, the bond market and the stock market moved in opposite directions.
Chairman Powell testified to Congress on Tuesday stating that the Fed plans to stay its course of keeping the Fed funds rate low. It is also continuing its asset purchase.
So, I am not in the camp of those who believe in the imminent demise of the US dollar, as the continued and common reports of its demise are, again, greatly exaggerated.
As I expect the market to top out in the next few years and enter into a prolonged bear market, the nature of the market rallies over the last 10 years have thoroughly trained investors that all you have to do is buy-the-dip, as the market always comes back.
Doctor Copper is riding high now and gold is on the outs. It’s a perfect setup. Either way, gold will have utility. Meanwhile, it works through a healthy correction.
If this is true, it means that even though I don’t like the current stimulus bill as it is structured, it is unlikely, even coupled with easy monetary policy, to produce anything other than transitory inflation.
Once upon a time gold was commonly used to finance productive enterprise. Unfortunately, 20th century events put that practice on a hiatus. But guess what? It’s back.
