Simit Patel

Economic Forecast and Best ETF Picks for 2009

Regarding my track record, my trading statement and my picks for ETFs are two different things. I was up over 20% in 2008 and over 30% in 2007. I stick to trading currencies and metals. I encourage those who may be interested in evaluating the validity, or lack thereof, of my analysis to read my other articles, and to see my trading journal at www.informedtrades.com where I keep a log of all my trades.

Capital Flight Into Yen Is Path of Least Resistance

excellent, excellent analysis. i am short USDJPY though was expecting a bounce off 95; fortunately for me it broke through that, although i am still somewhat expecting a retracement. yen is clearly the path of least resistance and i don't foresee that changing at least until the bull markets in gold and silver resume. even when those do resume i think yen bullishness will still be a favorable wager for the next 4 years.

First Comes Deflation, Then Comes Inflation

@JasonC, you raise valid points, though demand for dollar is dropping as well, as will be evidenced by the horrible fundamentals of the US dollar. the US economy's big productive asset was financials. as US financials fall and as deflationary forces create a world in which fewer and fewer assets are denominated in US dollars, demand for US dollars will fall. falling demand, coupled with inflationary supply side actions by the fed, will result in massive inflation.

Randy_H and css1971 noted that deflation can last a while. this is quite right. however, i think the budget deficits are what is going to really bring on inflation sooner rather than later. the US' income is falling, it is only a matter of time before it will not be able to sell more debt, at which point expansion of the money supply is the only way the debts will be repaid. i think we will see inflation resume in 2009.

the other factor to consider is central banks decreasing US dollar reserves, which i think will be a by product of the double deficit and corresponding decreased demand for US dollars. this would suggest inflation even if US banks are not able to lend to US consumers as dollars overseas will be unloaded.

Gold ETFs: What Went Wrong With Conventional Wisdom?

gold prices are being seriously manipulated, that is the issue. for instance there is naked shorting of the GLD ETF that is distorting prices there. there is another good article on seekingalpha about this:

seekingalpha.com/artic...