gold, page-42802

If you refer my chart I posted on gold, the odds favor a break of the support and heading lower. Powell's forward looking commentary will factor the market sentiment so the 10yr yield is just a symptom of the market forward looking anticipations.

I think it is a very complex conditions we are experiencing and not to say any other time had been less so. QE is the experiment with no previous study of its long term effect. All I know is that it has been partially successful in terms of addressing GFC destruction. Stable and much improved stock markets and around the world, stable housing, NFP and all those warm fuzzy economic indicators BUT the flip side is very weak inflation. Throw in the Tariff grenade and the mix could be explosive. The logical conclusion is a contraction of global economic growth.

Maybe the bond yield is what is required to kick start an inflationary condition starting with the cost of funding? This is the basis for manufactured products to base their cost calculation, commodity projects to be valued, wage rises to neutralise inflationary pressures on cost of living etc.....

This could be a good thing to start the inflationary cycle. Market crash because of this more expensive money is the next topic of discussion but then again it has probably entered the discussion on day 1 of the GFC ever since the Feds expanded their balance sheet with so called debt.

Nothing new and gold is the unfortunate negative side effect If you follow the logic when QE was first enacted, the hyper inflationary talk generated a swam of hot money trying to protect themselves in this environment. That dissipated with the realisation of non inflationary outcome!

Sometimes logic can have a cruel fate by simply believing the whole system is a simple structural change of logics! In the same fate, those who bet heavy in physical gold just saw the biggest bull run in the US stock markets while gold went into a technical market crash from $1900-$1050. Maybe sometimes it is better to accept that one does not really understand the situation which is complex and constitute many interim side effects on the capital system and just have a well balanced portfolio instead of betting with certainty of the future and paying the price of long term thinking because that is the only natural option aka trapped bull!