Liquidity, Liquidity Where Will It Go Next?
For the last 24 hours gold remained in a tight trading range with a high of $554.70 yesterday at 6:28 p.m. and a low today of $547 at 10:13 a.m. (NY Times). It closed at $551.90. Nothing real exciting!
Silver on the other hand traded from $10.12 to $10.51 (a new high not seen since about 1983) and closed at $10.48. The news here is that the SEC is about to authorize the new silver ETF and there has been substantial buying in anticipation of the new demand it will put on silver supply.
The general market is still in the doldrums after being up most of last week. It still seems, to me, to be overbought. As mentioned on the 19th, there are too many negatives on the dollar presently. This must be having a negative impact upon the general stock market.
The home builders are suffering quite a bit now as interest rates are slowing down the purchase of homes. I do not expect a total collapse of the housing market, but there will be a drop in demand. By the way, it is possible that commercial real estate is not being hit yet.
While the Fed has been increasing interest rates, it has been increasing the supply of dollars or liquidity in the market place. By the way, this stealth increase in the supply of "money" will be more hidden as the Fed ceases to report M3 at the end of March. Do you wonder why this measure is being eliminated?
This liquidity has to go some where. It will be interesting to see where it goes. I believe we will see a movement into assets, primarily, natural resources with emphasis upon energy (oil and natural gas), precious metals, and base metals. This vast amount of liquidity will give the residential housing more of a soft landing than many believe. Selected areas, such as, San Antonio will likely have a fairly firm housing market for the next few months into next year.
The United States, once a true melting pot as various cultures emigrated into the nation, is becoming more and more polarized into cultural factions. As our "open" borders attract more emigrants of a variety of cultures, we are losing the American "dream." We will soon be totally devoid of our American culture. Even the practical form of our government shows this. We have moved ever more toward a democracy never envisioned by our founding fathers. We were to be a representative republic under law. Democracy is in its basic form mob rule. The law is whatever the majority says it is. Thus, we are living under ever changing man's law without a firm foundation. This trend seems destined to continue. I would much prefer to live under God's Law given to us by the Sovereign Ruler of all. He and His law does not change.
Best to each, Doug
Silver on the other hand traded from $10.12 to $10.51 (a new high not seen since about 1983) and closed at $10.48. The news here is that the SEC is about to authorize the new silver ETF and there has been substantial buying in anticipation of the new demand it will put on silver supply.
The general market is still in the doldrums after being up most of last week. It still seems, to me, to be overbought. As mentioned on the 19th, there are too many negatives on the dollar presently. This must be having a negative impact upon the general stock market.
The home builders are suffering quite a bit now as interest rates are slowing down the purchase of homes. I do not expect a total collapse of the housing market, but there will be a drop in demand. By the way, it is possible that commercial real estate is not being hit yet.
While the Fed has been increasing interest rates, it has been increasing the supply of dollars or liquidity in the market place. By the way, this stealth increase in the supply of "money" will be more hidden as the Fed ceases to report M3 at the end of March. Do you wonder why this measure is being eliminated?
This liquidity has to go some where. It will be interesting to see where it goes. I believe we will see a movement into assets, primarily, natural resources with emphasis upon energy (oil and natural gas), precious metals, and base metals. This vast amount of liquidity will give the residential housing more of a soft landing than many believe. Selected areas, such as, San Antonio will likely have a fairly firm housing market for the next few months into next year.
The United States, once a true melting pot as various cultures emigrated into the nation, is becoming more and more polarized into cultural factions. As our "open" borders attract more emigrants of a variety of cultures, we are losing the American "dream." We will soon be totally devoid of our American culture. Even the practical form of our government shows this. We have moved ever more toward a democracy never envisioned by our founding fathers. We were to be a representative republic under law. Democracy is in its basic form mob rule. The law is whatever the majority says it is. Thus, we are living under ever changing man's law without a firm foundation. This trend seems destined to continue. I would much prefer to live under God's Law given to us by the Sovereign Ruler of all. He and His law does not change.
Best to each, Doug
posted by Doug @ 5:25 PM
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