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Monday, January 31, 2011

This Week without Charts - Egypt

This week I bring you no charts.

Primary reason is laziness. The charts are not going to show any major changes from the last two weeks.

What is a major change is the political unrest in Egypt. I expect by Friday the market to have been influenced by the Egyptian politics as it unfolds. I also can't see how the current ruler can remain in office. After 30 years of rule, his last minute ditch efforts to gain support will not work.

The real story isn't just Egypt, its the fact the middle east has quite a few governments that are operating without representing it's citizens. Many of whom have been helped kept into power by the USA.

Notice that technology has helped the citizens organize and in effect "uncover the inefficiencies" and take on the status quote. This theme I believe will be repeated for the future of US currency policy as I posted.

If the destabilization in the area spreads, expect oil to soar. I expect oil to soar anyway, just because of the situation. But a little skittish oil pricing is forgivable for a week or two. I am more concerned over a few months or year.

So for now, its see how the markets react. Watch natural resources, oil, gold, and USD as always.
BTW, I fully expect this situation to help push the US treasury rates lower, buying more time.

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