Iran switches reserves to gold

The G20 got together this weekend to stimulate and regulate. At the same time Iran is buying gold. The future rally in gold might come sooner than expected.

I think its pretty significant news when one of the world largest oil producers is switching its reserves to gold.

http://www.guardian.co.uk/business/feedarticle/8025778

Shorting US treasury bonds

Both Marc Faber and Jim Rogers have recommended shorting long us treasury bonds. For a multitude of reasons, I think they are very right. In my opinion, shorting us 30-year treasury bonds, is going to be a very good long term trade. You can do this by buying the TBT. I honestly cant see why anyone would want to borrow any more money to the US government at this point. They have very little industrial capacity left, and what they do have, GM and Ford, will soon go bankrupt or be bailed out by the us government, further adding to the massive mountain of US debt. The US has so far been lending to consume, and what the government is doing now is basically bailing out people who consume for a living, with money they dont have. Historically its never worked, and it wont work now. The US government is either going to go bankrupt by defaulting on their bonds, or create such a massive amount of inflation that the bonds will be worthless compared to now. Maybe even both.

This graph is very nice. The 30 year US T-Bond Yield was 15% in the eighties! Like Marc Faber said: US government bonds is the last bubble.




By the way, I sold my PM stocks for 42 $ per share, to buy some TBT. I also traded some oil and telecom shares i thought were a bit oversold. Alright profits. I'm not planning on posting all of my trades here in the future, as this is not a trading blog. This was an exception.

Also, Obama won. I see he wants to introduce a new new deal. Even better reason for shorting long US trasury bonds. But too bad for the americans, and the world for that matter, who will have to suffer through this long government made recession/depression.

Gold and politics

Quick comment on gold: I think gold will fall down further, perhaps even touching 500. So far its difficult, if not impossible, to say when, and at what price gold will turn bullish again. Still, buying at these levels will give good long term gains. Id also like to point out that other commodities (agricultural, base metals and energy) look very inviting at these prices.

Also, there is an election on in the US. I have no idea whos gonna win, although it seems as if Obama has the best shot. (He currently has a 87,6% chance according to intrade) But still, I dont have a clue. for all I know, Mcain is saving his best hatchet job for tomorrow when Obama has no time to respond. We'll see.