Monday, July 25, 2011

Weak Dollar

Last week came and went without a rally in the dollar, and now the dollar is trading below DXY 74.  I was going to write this article a few hours ago, and I would have looked brilliant, but I will still say what I thought even if it is expo-facto.

The dollar chart looks very weak.  Take it from a dollar bear who had given the dollar as much short term benefit as I could.  Will it collapse now?  I do not know, but the way it is trending I would not want to be long the dollar.  What is a better fiat?  The Swiss Franc?  The Yen?  Who knows, and better yet, who cares.  Go with gold, silver and platinum.  They are currencie and better yet, they are monie.

With the death of the dollar at hand, and it has been a long time coming, look for precious metals to take the slack.  Other fiat is just as fake as the dollar, and short term, they may benefit, but long term, cash will turn to gold.

I was wondering if Obama and Bernanke ever consider trying to learn about gold.  Do they ever go to sleep at night wondering, 'Why is gold still going up?'  They may already know, too, and they may be feinting ignorance.  If that is the case, we have to wonder, would either one ever try to save his career be saying, 'This morning while tying my shoes I figured out gold is the ultimate store of wealth!'  It would be interesting if they did, for at this point it is the only thing that could save their careers. 

Of course, they are puppets, and only do the bidding of their masters, and their masters do not care about a single man's legacy.  They have the broader scope of history to watch.  Most likely, gold will continue its steady parabolic climb, while fiat turns to ashe.  Dust to dust it burns, and in the end, the furnace will only have gold.

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