James Pethokoukis

The bear case for gold

December 9, 2009

Mike Darda of MKM Partners gives it his best shot:

If there were ever a crowded trade, long gold and shor the dollar certainly fits the bill (no pun intended). Indeed, zero percent short rates and huge deficits as far as the eye can see have been important tailwinds for the yellow metal. And they remain in place. However, gold appears expensive relative to industrial commodities and has risen much more than bond market inflation expectations or the money stock over the course of the last year (the monetary base has exploded higher, but M2 growth has been more modest).

On gold and asset bubbles and inflation

November 17, 2009

The great David Goldman. First on the US asset bubble:

BOTH bond and stock prices are driven by the dollar. 17.5% unemployment by the broad measure keeps wages down and keeps the CPI low, despite the surge in commodity prices, while the cheap dollar makes US assets a bargain. Well, not exactly: the enormous reserve growth on the part of Asian central banks means that the Treasury’s debt-buying program has been outsourced to America’s Asian trading partners! No-one dares pop the bubble. It’s like what Woody Allen said about death. He wasn’t afraid of it; he just didn’t want to be there when it happened.

PelosiCare could be bad news for the dollar

November 9, 2009

If the Reserve Bank of India’s directors had any doubts about the wisdom of buying 200 tonnes of IMF gold — and likely dumping some U.S. Treasuries in the process — they had only to watch last weekend’s legislative activities on Capitol Hill. The proceedings provided plenty of reassurance that the move was a smart play.

Tobin taxes, the dollar and gold

November 9, 2009

Perhaps the real reason Gordon Brown suggested a securities transaction tax was to tamp down on currency speculation that driven down global currencies vs. gold. Willam Rees-Mogg explains:

Obamanomics, Big Government, inflation and the price of gold

November 5, 2009

Ed Yardeni says the rising price of gold is sending a message about the political economy:

Barney Frank’s wrongheaded assault on the Fed

November 3, 2009

When you’re a nation getting ready to borrow $10 trillion or more over the next decade, you don’t want markets questioning your central bank’s commitment to controlling inflation.

Gold is nowhere near its old highs

September 3, 2009

A great factoid from the Calafia Beach Pundit, Scott Grannis:

Gold prices peaked in January 1980 at $850. In today’s dollars, that would be equivalent to $2,300. (The chart shows a peak of $1,800 because it uses month-end data.) So in rough terms, let’s say that gold today is worth about half of what it was at the peak of the inflation fears in early 1980.

Kudlow on Bernanke and the dollar

August 26, 2009

The great Lawrence Kudlow is skittish about Ben Bernanke’s seeming disinterest in a robust greenback:

Asia, the dollar and gold

June 4, 2009

OK, so it looks like Rising Asia is trying to get on the same currency page. Now lots of people think rumblings of the region dumping the dollar are empty threats. Where are they going to go, right? The euro? Please. David Goldman of the fantastic  Inner Workings blog thinks he has it figured out bold is mine):