Deflation seems to be the order of the day. I see it just about everywhere. I would normally agree that in this kind of contraction, nothing would escape its vortex. But, we are seeing a gigantic bubble of credit bursting. And this has a historical track record of valuing gold higher while most everything is dropping, which makes its real gain even greater.
Since this goes against my gut feeling, I have kept my gold allocation at 30%,(I was up to 50% in early Sept) but I will be adding to it in the coming weeks and months if it shows strength.
Until then, it’s all US$.
Well, maybe a few shorts and puts….a guys gotta have a little fun.
