Comment: The ECB

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has no choice.

I have been calling for 1.18 EURUSD for quite sometime. That seems to be major resistance. By default, the dollar benefits (57.6% of Index). Dollar up .46 today.

For my 2012 predictions article, I wrote the following;

"Gold and Silver Predictions There are so many gold bugs that talk about the fall of the dollar. But in a deflationary credit contraction, the dollar actually rises along with treasuries as the “safe haven.” Dollars still represent an asset. The dollar index, made up of 57% the Euro and 13% the Yen, has 70% of it countered by lousy economies that are sure to decline putting pressure on their own currencies to perform. By default, the U.S. dollar will benefit. There will be an eventual rise in the price of gold with all currencies. All currencies are on a ship with the U.S. dollar on one side and the Euro, Pound and Yen on the other. They run from one side of the ship to the other where sometimes the dollar is higher and sometimes the other currencies, all trying to stay afloat. Unfortunately the ship is called the Titanic when compared to gold and all of those currencies will be chasing the gold and silver lifeboats at some point. I have been saying that while the U.S. dollar gains strength, primarily against the Euro, it could have some pressure on gold and silver. The dollar index is now past 81 and moving towards the 88,89 level while the Euro moves down to its lows of around 117,118. I do see these levels reached in 2012."

I was a little early in the call, but that's what Central Bankers are good at....delaying the inevitable.

Author of Buy Gold and Silver Safely
Next book: Illusions of Wealth - due out soon
Also writing book We the Serfs!