The US Dollar Is Entering a Tailspin

Last week as the US dollar spiked many currency speculators were suckered into the trade. They are now underwater hoping for a rally. Soon they will stop hoping, and bailout of the biggest currency head fake ever. The US dollar is entering a tailspin from which recovery is impossible.

Topics: currency trading, forex, US Dollar;

Gold Is The Safe Haven

Treasury bonds are not a safe haven. The Federal Reserve will own all the Treasury bonds, as well as most other U.S. dollar denominated debt. The problem is that the tens of trillions of dollars the Fed will print to buy all those bonds will be practically worthless. Gold is the safe haven.

Real bond yields will plunge as inflation soars. Normally rising inflation would push up nominal yields to compensate buyers for the erosion of their purchasing power. But since the Federal Reserve is buying to keep nominal yields from rising, the entire bond market is about to be monetized!

Gold: How It Reacts During Crisis

During the 2008 financial crisis, gold fell about 25 percent and took seven months to make a new high. This time gold only fell about 15 percent, and may make a new high in under a month. This shows how much greater this financial crisis is, and how much more reckless current Fed policy is.

Related trading instruments: SPDR Gold Trust ETF (GLD), Market Vectors Gold Miners ETF (GDX)