Historically, the gold market always experiences something of a drop-off in February, as each year’s two-month run of worldwide festivals (Christmas in the West, Eid for the Muslims, Diwali for the Indians, Chinese New Year for the Chinese) comes to an end, and jewelry demand tanks.
In the past year, that anomaly seems to have died. I’m sure Bernanke’s knuckling under to the fixed-income Wall Street crowd has also helped — although the stagflationary consequences of Bernanke’s blundering cash-for-trash monetarism will echo for years hence.
At any rate, Treasuries tanked (yields soared) today.
|3-Month||2.18 / 2.22||-0.00 / .031|
|6-Month||2.07 / 2.13||-0.02 / .057|
|2-Year||100-04+ / 2.04||-0-08 / .131|
|5-Year||99-26¼ / 2.91||-0-22¾ / .156|
|10-Year||96-26¾ / 3.89||-0-29¾ / .115|
|30-Year||95-15 / 4.66||-1-08+ / .081|
The yield curve is actually beginning to flatten itself, because inflation-sensitive 2-year and 5-year T-bills are rising faster than 30-year Treasuries.
And then there are commodities.
But fear not … inflation risks remain well-contained … quoth the high priests of monetary shamanism.
Russian metals magnate Oleg Deripaska is now nominally the fourth-richest man in the world, with a net worth of around $45 billion. His net worth almost certainly is less than Putin’s (his listed assets alone were worth $42 billion several months ago, and are probably pushing $50 billion now) — to say nothing of Hugo Chavez.