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Richard's Remarks

 

Yield (income) = RISK

 

Everybody is searching frantically for income. But today, income (if you can find it) comes with big risk. Thanks Ben Bernanke for the painful trade-off.

 

Bernanke's basic strategy is to buy (annually) a trillion dollars worth of Treasuries and mortgage-back securities. This is calculated to drive bond prices skyward and their yields down. Once bond yields were low enough, investors would be forced (as they searched for yields and income) into equities. The rising stock market was supposed to bring on good times, and the unemployment rate would decline. Furthermore, investors would be forced to return to real estate, and all would be blissful.

 

Question -- In view of the Fed's policies, why isn't gold taking off?

 

Answer -- I believe that gold is being manipulated to the downside by massive shorting. With the US dollar losing purchasing power by the week, the Achilles Heel of the Bernanke strategy is the ... Log in or subscribe to continue reading.


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