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Gold and Dollar Market Summary

Gold and Dollar Market Summary
Thursday, March 31, 2005, 7:59:00 PM EST
Author: Jim Sinclair

Dear CIGA:

Think for a moment what it would mean to the US dollar to have oil prices spike upwards and the economy roll over. The US Federal Budget deficit would skyrocket and the Current Account Deficit would rise towards the heavens. The dollar would drop like a stone. Gold in my opinion will take out $529 like a hot knife through butter.

Today, I filled up my Volvo, which gets great gas mileage, and it cost me $40. You think that the cost of food and energy means nothing to inflation? That is Fed claptrap.

Here is an example of why the “trade all the time” philosophy is a guarantee that when gold rips you will not be part of it. Here is a reason why the numskulls that have been selling the pants off gold shares are simply nutbars.

You have to know that the Administration is desperate with respect to the potential growth of the US Federal Deficit when they attempt to take the funds earmarked for victims and credit them to the Federal Deficit as reported today by the Wall Street Journal.

We are still in a “one day good economic report, the next day bad” period with the market becoming frantic on each report. The condition is simple: The economy is running sideways at a high level and leaning somewhat over. Any drop in tax revenues and the US Federal Budget deficit goes wild.

Nothing serious will be done to correct this situation as the US is determined to spread democracy to the multitudes and the weak dollar will require heaving all the entitlement spending at some time in the future - more than likely in either 2008 or 2011.


LINK: http://www.jsmineset.com/