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FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

Gold Price Forecast Drop Target $787.40

Commodities / Gold and Silver 2013 Apr 21, 2013 - 11:00 AM GMT

By: Brian_Bloom

Commodities

The unemotional 5% X 3 box reversal P&F chart below (courtesy stockcharts.com) shows a measured move target for gold at $787.40.

No time horizon is capable of being forecast.


Too few understand that:

· the Fed’s purchases of existing government debt does not add to the money supply and, therefore, it is not inflationary. (I read a scathing “expose” of Dr Bernanke’s stupidity and it was clear that the person attacking him did not understand the bookkeeping entries. )

· the slowing velocity of money across the planet serves to place a drag on both the money multiplier and the increasing money supply. Therefore, the Fed’s printing of money is losing its potency to drive the US economy, which is potentially deflationary.

· the underlying reason for the Cyprus deal structure was that the Greek public debt would have had to have been marked to market if the deal was not done in that way. If one of the two banks had been liquidated, the value of Greek sovereign debt would have become transparent. In turn, this would have triggered a cascading domino collapse of supposedly solvent banks who would have been forced to mark to market

· this situation of keeping sovereign debt on the books at full value is not sustainable. At some point, European sovereign debt will have to be marked to market. Should this happen, it will certainly be deflationary

· the people who will benefit most from deflation are the mega wealthy; the people who will have access to both income and cash in an environment of falling asset prices.

With these facts in mind, the above chart becomes believable, but I stress that the time it might take is unknowable. I have been blogging for eleven years trying to explain the real drivers of the economy. After due consideration, for me to continue blogging now will be pointless. My two fact-based novels make constructive suggestions. If people are interested in my thoughts in that regard then they should read those novels.

Brian Bloom

Author, Beyond Neanderthal and The Last Finesse

www.beyondneanderthal.com

Beyond Neanderthal and The Last Finesse are now available to purchase in e-book format, at under US$10 a copy, via almost 60 web based book retailers across the globe. In addition to Kindle, the entertaining, easy-to-read fact based adventure novels may also be downloaded on Kindle for PC, iPhone, iPod Touch, Blackberry, Nook, iPad and Adobe Digital Editions. Together, these two books offer a holistic right brain/left brain view of the current human condition, and of possibilities for a more positive future for humanity.

Copyright © 2013 Brian Bloom - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Brian Bloom Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


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