zhandax

Oil and Gold Grab the Headlines - But Silver's Another Major Mover

I might point out that gold's selling on Wednesday stalled out where the last group of shorts became bagholders. Most of those guys were granted 'forget the cheese, let me out of the trap'. What will you care to wager that they all become gold bulls on the third bar back over $960?

Requiem for a Departing Economic System

While I agree that too many dollars and too much leverage was the original problem and adding more is just making things worse, I might point out that the Fed is NOT accepting the "toxic subprime sludge" in these swaps. This "fix" is just to keep Fannie and Freddie backed paper from being shunned like the sludge. Following the argument that the government must bail either of them out when they become insolvent, the Fed is indirectly already on the hook for that paper.

That said, the sludge is still out there, buried in 6 point footnotes to balance sheets and the Fed has not yet developed the "fix" for it. There are another couple of rounds of this type of creativity still ahead which is why I won't loose any sleep throwing money at gold and oil at the all-time highs.