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About a year ago I did some work my monthly historical bond charts using
fibonacci analysis, which suggested rates would hit 3.5-3.8% within the next
couple of years. I did the same with TBills and hit projections of 1.8-2.0%.
Having a few suspicions what this might mean, I moved on to the yen and mark,
hitting projections of 160 and 200 to the dollar respectively.
Such extraordinarily low rates are associated with panics and depressions. Will
it happen? I don't know but Asia is a disaster area, the deflation genie seems
to be running amuck, and the US markets are beyond all historical valuation
measures. AG might have been able to avoid an inevitable meltdown had he backed
his "irrational exuberance" words with action. Instead he bowed to politics and
waited, hoping he would not have to take action. Now he can't take action
without making Asia and Russia implode faster than they were. The IMF doesn't
have enough billions to save the world.
Earl
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