A Very Worrying Story for the US Economy
The overall macroeconomic scene is, frankly, a big mess right now. One might say that if things start to unravel, then the scene would quickly devolve from being a mess to being outright terrifying.
In my last write-up, I focused heavily on the bull markets in gold and silver. I have been touting these trades for many, many months, and the markets have cooperated nicely with sharp rallies. Given the underlying fundamentals in the global economy, these rallies have been among the easiest markets to forecast in a very long time. Silver continued its surge and nearly touched my intermediate target of $30.00, while gold got within shouting distance of $2500.00 per ounce. Both gold and silver corrected sharply late on Friday when heavy selling caught some short-term players long. The authorities are deathly afraid of market moves which suggest that inflationary pressures are spinning out of control again, so they welcomed the selloff. Both gold and silver should resume their rallies after a period of consolidation and choppy trading.
A number of major banks have finally noticed that gold and silver were in the midst of major rallies, and they put out revised forecasts this week, sharply raising their year-end targets.