Bonne Année - Happy New Year

"Do not be preoccupied with the wicked, or envy those who do evil. They will dry up and wither away like the grass and green plants.

Trust the Lord, and do good things. Live in the land, and practice being faithful.

Be happy with the Lord, and He will give you the desires of your heart.

Conform your ways to His, and He will sustain your efforts. Your righteousness will shine like a light, your just cause like the sun.

Surrender your self to the Lord and wait patiently, abiding in Him."

Psalm 37

Merson, Rest On the Flight Into Egypt

Gold Daily and Silver Weekly Charts

A sharp rally in the metals today along with stocks, on the last day of the year.

Gold extended its longest bull market since 1920 with a modest 7 percent gain for the year. Stocks returned about 13 percent, and bonds eaked out about 4 percent depending on duration.

In a period of inflation stocks may do well. In stagflation, not so well depending on how the expansion of the money supply and tax gimmicks are wrapped up in policy and the delivery of monetization. Multinationals may outperform depending on the evolution of global trade, policy, and the currency wars.

And as for me, I suspect that we haven't seen anything like a top yet in the metals. The printing presses and de facto defaults are just getting underway.

Non-Farm Payrolls number on Friday, and the fiscal cliff follies will enliven the Congress for the rest of the week.

There is a chance that they will kick the budget cuts can down the road, and merely prevent those making $450,000 or less from a repeal of the Bush tax cuts.

I would suggest that you keep an eye on those rowdy boys in the House.

Have a safe and Happy New Year.

SP 500 and NDX Futures Daily Charts - No Deal

There was no deal on the 'fiscal cliff' before the deadline at midnight tonight, but there was plenty of speculation, hints, and hope.

Whatever the leaders decide amongst themselves, the members of the House and Senate must ratify.

But there was plenty of paint on the tape for the close of this year.

Non-Farm Payrolls number comes out on Friday.

Have a safe and pleasant holiday.

Gold This Time Last Year - A Faux Deal and Ongoing Currency Wars

The waters are a little muddied this time around because of the fiscal fluff and the January debt ceiling policy scrum to come, but lo and behold, gold rallied sharply on the last day of the year, after a series of repeated hits lower.

How unusual.

New year, same old games.

And Washington announced, in time before the markets close, that they reached a deal, kind of.

No grand bargain, but a deferral.

It looks like the Senate will agree to avert the tax increases for those with less than 450,000 per year in income, arrangements on capital gains, 40% inheritance tax on estates over 5 million, and AMT. It appears they will leave the budget cut wrangling for the debt ceiling fight in January, and possibly every two months next year after that.

The House will not have a chance to vote for it until later this week most likely.

And at the bottom, an update on Jim Rickards on the ongoing currency wars.