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Today in Commodities: Dollar in the Driver's Seat

Yes, it seems likely that the next two contract months for UNG will be disappointing, but "all things eventually return to the mean." Natural gas futures will rise -- of course, the only issue is when. At this point with UNG near $11.00, suppose one goes long and it falls to $9.00 within the next few weeks, I suggest that may only be a paper loss of less than 20%, and falling to $9.00 intuitively to me seems unlikely. But, when UNG rises, though probably never getting near its near $65 high of about two years ago, it is not unthinkable that it will provide investors with a very good long-term capital gain from its current level. Yes, I am long UNG and have bought bits and pieces as it has been going down. And yes, I may look up and see the knife falling on me. That's risk/reward.

Donald Luskin: Gold and the Upside-Down Bell Curve

Madcow2, many econiomists and intelligent investors understand, and likely agree with, Luskin's above analysis. Moreover, yourand Luskin's point I believe is sound -- a rising gold price trend line indicates the FED's anti-deflation plan appears to be working. No doubt a country can survive inflation (up to a point), but serious deflation sets the stage for another, perhaps even deeper and longer "Greater" Depression in the future. Washington officials are right in pulling all stops to prevent that from happening.

Gold: War of Attrition

In economics 101. one is taught that printing money to monitize increasing national debt (i.e., to pay for giant bailouts and socialize the private sector dobt; to make up for sharply lower tax revenues; to underwrite the costs of ongoing wars -- in the end will result in high, if not hyper, inflation as the value of the dollar deflates and the vaule of precious metals, especially gold, rises accordingly. The rules of economics are simple and it is only in over-analysis to we get off track from fundamentals. Long gold is indeed for those who have patience.

Two Strategic Investments to Benefit from the Bailout

Really rich people buy Timex and and leave gold to speculators.