“I think the tapering talk will continue, but I’m skeptical that we’re going to see any tapering other than perhaps one token attempt to still their critics by making some small cutback…
The money printing that’s been done, and the levels of irregulation that’s being imposed on the economy, on businesses and entrepreneurs is such that the inflationary potential is there and it will assert itself. -Don Coxe
By Tekoa Da Silva, Bull Market Thinking:
Don Coxe, Chairman of Coxe Advisors LLP, has issued a powerful new weekly review of global capital markets, entitled, “Seeds of Deflation.”
In this updated conference call, Don spoke to a potential impetus behind ongoing taper-talk, inflationary kindling remaining within the economy, and of great interest to our readers–an updated comment on gold.
Beginning at the 17:75 mark, Don noted that, “With all this talk about tapering, I’m cynical enough to believe that what they’re doing is talking about that to prevent the 10 year treasury yields from breaking through 3%, without them [actually] doing anything about it. This is the case where talk is cheap, and it’s better than having to print even more money to buy more and more [assets].”
“I think the tapering talk will continue,” Don added, “but I’m skeptical that we’re going to see any tapering other than perhaps one token attempt to still their critics by making some small cutback.”
Commenting on gold, Don indicated that, “What’s happening with gold, is that the worst fears of gold investors are being confirmed, which is that gold speculators (as opposed to gold investors) could not maintain their positions in gold at $1500, $1600, $1700, $1800 levels, because there was no confirmation, no pass-through from the aggressive money printing being done by the central banks, and at some point, what they say, is that they just plain have to dispose of their position[s].”
In terms of where we are within the gold consolidation, Don said, “I don’t know therefore, at what point…we get a capitulation. So I obviously haven’t changed my views, that ‘as ye’ sow, so shall ye’ reap’—it’s only a question of the time. It’s not like predicting when you’re going to reap the corn and the wheat. The money printing that’s been done, and the levels of irregulation that’s being imposed on the economy, on businesses and entrepreneurs is such that the inflationary potential is there and it will assert itself—but it’s not going to be enough to bail somebody out who’s got a very short-term view.”
Editor’s Note: Don Coxe may be launching a subscription service soon. His conference calls and market comments are currently all free, and available at the website link below. This is a fantastic opportunity to hear and learn from Don every week—which may not be here for very long. Please take advantage of it.
To learn more about Don Coxe (and to follow his regular work) visit: CoxeAdvisors.com