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Thursday, December 22, 2011

The End Game

Looking ahead to next year, I see a few big drivers.
First is Europe, can they keep it together to not fall apart until after US elections.
Second is the US economy, China, and Europe, how deep does the next deflationary rabbit hole go?
And last is American politics.

If we get more Obama/Bush, its more huge deficits and a race to the bottom for the US currency.  The only candidate where that is not the outcome is Ron Paul.
Ron Paul is many things, but one thing he is beyond a doubt, pro-fiscal responsibility.
I will ignore the whole "gold is money thing", for I hope that is a complete non-starter if he is elected.
Other than that, him cleaning house means a SOARING USD, also a market collapse as reality is brought back, by restoring fake accounting rules instituted in 2009 under "emergency" conditions.
Apparently the emergency will last forever, unless Ron Paul is elected to re-instate sane accounting.

Either way, I really cant see a soaring market in 2012.  I also can't see a collapsing dollar into the election IF Ron Paul gains legitimate status for president.

And I can't see gold soaring if Ron Paul is a contender, for if there is fiscal discipline, gold is not a required hedge.

Anything could happen, there are so many factors.  But the end game for this entire debacle is with the next president of the USA.  For that president won't be able to kick the can like Obama did "one last time" for 4 years..

The dirty secrets are out, the banks, governments, and financial corporations are under scrutiny.  The people are awaking to what I realized back in August 2006.   And once they get to where I have been for years, the can kicking will be called BS, and reckoning day will finally arrive.

No, we won't die en mass, and there won't be mad max, but there will be an "adjustment" to the realities of the serious topics pressing the world.

For now, CASH is still king, and some gold is OK, until it crosses below the uptrend line.

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