Dow Jones newswire services is reporting comments made from Goldman Sach's co-head of their Healthcare, Consumer and Retail Financing Group, Richard Kimball, that US federal debt levels and continuing budget deficits run the likelihood that Central Banks will begin moving more of their foreign currency reserves out of the U S Dollar and into other currencies.
He also spoke to the subject of rising crude oil prices exacerbating money flows from oil producing nations to emerging markets such as Brazil and other various Asian economies contributing to further inflationary problems in the recipients of those flows as well as the inherent instability resulting from the swelling of international capital flows.
The point to bring away from this is what we have been echoing for some time now - inflation is a major concern in the emerging market nations around the globe and that is the reason that demand for gold and silver continues to remain robust.
It also points out the difficulty that the US is going to have continuing to attract enough willing lenders at current levels of interest yield for the mammoth amount of borrowing that it is going to require to fund those deficits and debt levels.
Do you not find it ironic that the Dollar was whacked today given all the turmoil around the globe.
based on tons of evidence that Goldie Sucks is always talking their book, doesnt that mean CB's, under the Bernank's command, are just about to load up on fiat FRN?
ReplyDelete@janrom
ReplyDeleteIf theres an announcement saying no QE3 then yes CB's doing dollar swaps with the Fed and then buying lots of treasury's.