The Fed Chairman is between a rock and a hard place. He can increase descent, not interest rates to stop the dollar because higher interest rates is damaged the already weak recovery. So he is forced, money to help activity - stimulate that is the basic force driving has to keep prices and the hottest higher raw material prices. It is a win-win for macro hedge funds impact.
So, he is confronted with a quandry.Unsold real estate, mortgage foreclosures, lower household wealth, high unemployment, modest income growth, are between the rock and the hard. As the dollar weaker holds gold, silver and oil to keep strengthening. Gold has insanely to $1556.40 an ounce, without a real correction crashed. Oil prices are up 7.3% trade recognizes the repetition of a classical dynamics in April as speculative passion in the futures market. Silver is always ready, his final push until $50 an ounce make such as regulators and market participants really are raising margin requirements.
We close on mania in silver and this relationship for a moment or two.loss protects your out growing conviction gold and oil of the value of the dollar. In other words the price is of easy money stimulation falling price of the Doillar and a rising prices of gold, silver and oil. "This is what the Chairman called"temporary"inflation." And it comes as result of fed add $3.8 billion per day to their balance sheets according to ComStock partners, Inc. in a 28 April market commentary. Federal Reserve credit is the last 3 months while stocks by 38%, only 8%, are more than 20% and 10% gold oil. Think of this relationship for a moment or two. If the Fed balance sheet is reduced-finally what Bernanke is it not when - say the exit speculators: the run.
So, my rule of thumb is: as long as the Fed balance sheet increases and the dollar keeps falling - hot money, fast money in stocks, gold and oil. My fast think PAL, Barry Ritholtz, moved by a long Pposition of 30% to 90% of the market momentum was surprised him. His latest wise BA, Boeing, CBOE, Chicago Board of options Exchange(lot_of_action_out_there) and HSY, Hershey.
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