12 February 2012

SP 500 Deflated By Gold



Much of the recent rally, that nominally looks like a straight shot higher is really due to the monetization going on in the US and Europe.

Such distribution of money through asset bubbles can provide the appearance of vitality, but it is not self-sustaining.

But as we saw in the tech and the housing bubbles, they can go quite far, and inflict serious damage on real economy, before they collapse.