Share
What will it be?
Inflation or deflation?
Will the banks spend their 'new found riches'? Will they start lending to each other? If, so then an economic recovery is on the cards and that will lead to inflation since the money supply has increased expotentially. And in that context, gold and gold stocks are a 'must have'.
If the banks 'sit on their hands'; if lending and spending grind to a halt then deflation will be the outcome - and cash will be king.
So what will it be? How will the banks and financial instututions react? Clearly 'govt.' and the 'powers that be' want an economic recovery and with so many banks and financial institutions now in defacto govt. hands, via bailouts and 'nationalisation', I think govt. policy will win out and the inflationary economic recovery will materialise.
And in such an environment .... gold will be a winner.
Inflationary pressures after such a massive increase in money supply are odds on to materialise one or two years from now, if not sooner.
Since the market is predictive, once the inflationary trend is clearer, gold will move north quite dramatically well before "Main Street" has twigged to what is really going on .... in my opinion.
It could go either way, but my money is literally banking on an inflationary spiral - with gold the big beneficiary.
