Wednesday, December 03, 2008

Treasury Bubble Collapse Monitor. GDX, AUY, ABX, SSRI, SLW, HUI, XAU

This chart of TLT 20+ year Treasury Bond Fund is telling a lot about state of the Next Mother of Bubbles to burst. Until November 17, 2008 prices were making lower highs in normal market conditions when initial panic was diminishing and people reallocated to equity on the dips. Something powerful happen on November 17th, 2008 and price went parabolic breaking out Upside. That something is Quantitative Easing when FED start to buy Treasuries and expending monetary base (printing money) to fight deflation. Nobody knows for sure when this Bubble will burst, but with this magnitude of parabolic rise this time is closer then a lot of people would like to think. Bubble Media spin is that money is piling now into Treasuries "anticipating" QE, we dare to claim that this rise was manipulated by QE and all those piling in are lemmings to be crashed off the cliff. What will be the pivotal point of explosion? We are monitoring price of Gold for guidance.

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