September 9, 2012
Weekly Market Outlook
By Keith Schneider
The Global Equities market soared this week, led by the U.S., to levels not seen in the NASDQ for over a decade with a five year high for the Dow. This can be attributed to the Bernanke/Draghi statements that basically amount to a free put option on the equity markets as they both promise unlimited amounts of liquidity to solve the economic slowdown and Eurozone issues. China, also faced with a slowing economy, joined the fray and announced a major state investment in infrastructure immediately sending mining and natural resource assets soaring.
It’s a scenario where good economic news rallies the markets and bad news such as an anemic jobs report moves the markets even more. The expected added liquidity from a new round of easing made gold and silver the best place to park your money on a relative basis.
Meanwhile, under Putin’s direction, Russia has been steadily accumulating gold for years and now ranks as one of the top five holders of the yellow relic, adding to Putin’s many accomplishments from KGB agent to President of Russia to Conservationist to Super Bowl ring thief, and now world class commodity trader. An astute player on the world stage, his long term play in gold is interesting.
Whether he is storing gold reserves in anticipation of political unrest and a global confrontation or just a bet on the general debasement of the dollar and other paper currencies, his doubling down in an already mineral rich country is worth noting. This week’s video will include coverage of rates, gold and the US Equities plus a leading sector.
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