Funds Embrace Dollar as Crisis Mutates Into Global Slump

have NEVER been worth nothing. Fiat currencies have, in many countries. Put that in your pipe and smoke it.

Be slow to buy. There are many out there that bought on credit. Silver could go as low as $7.77 and Gold as low as $470. Have to be patient and of course not sell what you have already aquired. Trading now will make you a Traitor to the movement. This is a R3volution and our opposition is going to be playing hardball. They have a lot of tricks and illusions.
grant

There are many fools that borrow/borrowed money to buy gold and silver, or borrow/borrowed money to increase production at their businesses. These fools will most likely have to sell cheap to cover their ass. However those who aren't/weren't tempted to borrow money to invest will ride out the storm, I suspect it will be well after the first of the year before prices begin to rise. Only a fool would go out and and borrow money. We have to remember that the Fed has the military backing of the U.S. as it's watchdog to keep the dollar supported and central bankers around the world working with them. They will do everything to get our gold and property away from us. If you "need" something pay cash, if you have no cash trade services or barter goods.
The R3volution can win with brainpower, not bullets.
grant

If the funds are embracing the dollar, I wonder what they are selling in order to buy those dollars? Are they selling other foreign currencies in order to buy dollars?

According to the government, inflation was still accelerating in July. The annualized rate, not using the government's massaged numbers, looks like it is now well over 10%. No signs of slowing down. And everything the government does - bailouts, stimulus checks, borrowing to make payroll, pissing off the foreign holders of US treasuries - is inflationary.

Milton Friedman established experimentally that general price increases follow the expansion of the money supply in 18 - 24 months. So we are now experiencing symptoms of Fed activity over a year ago. And inflationary activity by the Fed and the government in the last year have yet to be felt in price increases. So there would seem to be at least another yeat of price increases in the pipe already.

Soon there will be another stimulus program that creates money while bypasing the traditional Fed credit source. And there will be more bank closures - involving handouts to depositors, bank bailouts - involving pouring new cash into bank reserves, and big corporate bailouts - involving new cash handouts to shareholders etc.

The only way I see deflation is if everyone stops borrowing money, pays back outstanding loans, and the government doesn't create new money for stimuls plans and to make its ever-expansing payroll. None of those things are happening yet and I don't think they will.

Today's article is basically the author's gleaning of information from Merrill's latest survey of fund managers. My assumption with respect to fund managers is that they are not much different than any other profession or occupation in that there is a small percentage (perhaps 10%) that are pretty damn good, a small percentage (perhaps 10%) that are borderline incompetent, and the rest (about 80%) that just follow the herd and never really question where their instructions come from. So when I see that the Merrill survey shows that fund managers, in general, are loading up on the US$, I'm not surprised. Personally, I'd rather know what the good ones are doing, and to find out I go online and look for what they might be blogging in their own words.

After reading both of the author's linked articles, I would say that he laid out a sound rationale for being long gold and short any western fiat currency in yesterday's article, and in today's article he is merely reporting how the body of large fund managers (sheep) are looking out for their clients' wealth...which should be more than a bit frightening to anyone relying on fund managers to protect their wealth.

lol...... ok neoconned.... since you can't understand Sinclaire let me see if I can explain it.. if slowing business activity is a precurser to DEFLATION, then why is Zimbabwe experiencing HYPER INFLATION! with slowing economies the central banks lower interest rates to stimulate economic activity! it is INFLATIONARY! AGAIN WHAT HAS RON PAUL recently told us! we are seeing stagflation that will lead to an INFATIONARY DEPRESSION! as the economy slows, the government has less tax revenue, jobless clims go up the governments costs go up, so what do they do to pay the bills... they print money! the account defeceit goes up the government competes with private business for money to pay interest on its debt. thus slowing business activity even more and just to get on your nerves.. here is Jim Sinclaire.. oops also some here on the daily paul are saying the fed would raise rates.. now look what was said in this article.. now they are talking about cutting rates.. and INFLATION IS ALREADY RAGING!

Jim's Formula sept 2006

First interest rates rise affecting the drivers of the US economy, housing, but before that auto production goes from bull to a bear markets.
This impacts many other industries and the jobs report. An economy is either rising at a rising rate or business activity is falling at an increasing rate. That is economic law 101. There is no such thing in any market as a Plateau of Prosperity or Cinderella - Goldilocks situations.
We have witnessed the Dow rise on economic news indicating deceleration of activity. This continues until major corporations announced poor earnings, making the Dow fall faster than it rose, moving it deeply into the red.
The formula economically is inherent in #2 which is lower economic activity equals lower profits.
Lower profits leads to lower Federal Tax revenues.
Lower Federal tax revenues in the face of increased Federal spending causes geometric, not arithmetic, rises in the US Federal Budget deficit. This is also true for cities & States as it is for the Federal government.
The increased US Federal Budget deficit in the face of a US Trade Deficit increases the US Current Account Deficit.
The US Current Account Balance is the speedometer of the money exiting the US into world markets (deficit).
It is this deficit that must be met by incoming investment in the US in any form. It could be anything from businesses, equities to Treasury instruments. We are already seeing a fall off in the situation of developing nations carrying the spending habits of industrial nations; a contradiction in terms.
If the investment by non US entities fails to meet the exiting dollars by all means, then the US must turn within to finance the shortfall.
Assuming the US turns inside to finance all maturities, interest rates will rise with the long term rates moving fastest regardless of prevailing business conditions.
This will further contract business activity and start a downward spiral of unparalleled dimension because the size of US debt already issued is of unparalleled dimension.
Therefore as you get to #12 you are automatically right back at #1. This is an economic downward spiral.

I heard all this "slow business" as negative to gold talk in the 70s. It was totally wrong then. It will be exactly the same now.

and please......no jim sinclaire ventriloquist dummy regurgitation copy/paste. If you disagree with the articles author, lay out why you do.