Latest Comments From Gene Inger’s Daily Briefing

Posted By on December 28, 2010

Gene Inger’s Daily Briefing . . . for Wednesday December 29, 2010:
Good evening; 
The ‘Insolvent Age’ . . .well-describes the overall risk faced in 2011, which if viewed with full transparency, has risk of making a so-called ‘new normal’ seem comfortable. There are warning flags galore flying; and the irony is it doesn’t necessarily mean that a simple hedge is Gold or Silver, though both were up nicely today. Equities are a product of the continuing forecast ‘bond bust’ of course, but increasingly are probing levels that would require optimum foreign gains, in revenue, by most multinational corporations next year. China’s continuing interest rate hikes (and other measures to stem speculation) are not new, but part of overall processes to slow growth, which would also impact multinational corporate profits.
The European story suggesting that there’s only a small percentage of ‘physical’ gold or silver to cover paper contracts is probably on-track if not precisely on-the-mark. It’s a reason why all kind of chaotic situations (backwardation, contangos, etc.) could hit in 2011, and why markets in general could be roiled. That equities have advanced in this case further than a slow-growth environment justifies, worsens the risk exposure.

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