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UNCERTAINTY

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Economy, Heavy Lifting, Investing, The Earth, Thoughts

Those who comment on the financial markets often mention that what is most obvious is uncertainty – those who trade in markets are uncertain about the future. In previous times there has not been firm certainty about the future, yet the current feeling is one of malaise (nod to President Carter).

It’s just not knowing whether markets are going up or down the next day; it’s more than that. It’s not knowing whether life will be as it has been in the past. It’s not just markets; it’s global warming, flooding major cities, population explosion, food and water shortages.

Who is certain that the global warming crisis will be solved in time (Humans do not solve problems that are not imminent)? What will happen when major seaboard cities have become unlivable? Where will the inhabitants have gone? What will happen when the poor in a country are fighting the rich for food and water? What will happen when poor undeveloped countries are “fighting” rich, developed countries for food and water?

It’s too late for contraception to head off the population explosion. The effects may be resolved by a nuclear war or the outbreak of a killer virus.

The people who trade in financial markets have these things in the backs of their minds. The man in the street on streets around the world have these things in the backs of their minds as they distrust their governments and other institutions to improve their lives. Even the Pope senses his church has “gone wrong.” He hopes trying to right its course may save it and its mission.

Our main certainty may be that no one and no movement can save us from possible calamities that will be the solutions to our major concerns.

Investing in Gold and Other Thoughts

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Economy, Investing, The Earth, Thoughts

Quantitative easing, that I don’t really understand, is a reflating tool. I had to look up “reflating” this morning since Bill Gross used it in his latest Tweet. I’m sorry, Bill, I didn’t see how you “got it wrong” on the Barron’s Roundtable, but I forgive you, since I always felt anything I took away from watching one of those sessions was a worthless investing idea. Different opinions on relating/inflating/deflating are floating through the economic ether and no one can know for sure NOW which is right. Will reflating be inflationary in the bad sense of the word? It might be but who can be sure whether it will be good for the price of gold?

When I sit back and look up this is getting really complicated. Near term the United States and the dollar are riding high. Reflating is not likely to bring down either one. Long term the period of US ascendancy on the world stage is coming to an end. The buying power of the emerging world-wide middle class is likely to be inflationary with bumps and starts. There will be buying pressure on basic commodities, food, water and energy, but not necessarily on gold.

My conclusion from this thinking is that both near term and long term gold is not a “sure bet.” Until today my thinking was short, medium and even long term gold was not a good investment, but VERY long term it might be. Has this opinion changed? I’m not sure. Long term for sure basic commodities, food, water and energy would be good investments. They may also be good near term investments as smart money begins to seek them out.

Gold is likely to have a good “reflexive rebound.” Will this be a good time to get permanently out?

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