"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


Wednesday, September 3, 2014

Trader Dan's Grain Index at 50 Month Low

Not much to add to the chart, which is essentially a composite of some of the grain markets. This is going to help with any inflation pressures on the food front. We still have some high-priced beef and pork ( at the retail level) to deal with but those prices will be coming down in the next few weeks.

Along this line, check out the latest on the TIPS Spread and the Gold Price. It hit a 5 month low today!

As mentioned many times here recently, the market is taking the view that inflationary pressures in the broader economy are not a serious concern. More headwinds for gold which is higher today due to disappointment in an earlier-announced cease fire in the Ukraine which turned out to be merely an outline for a cease-fire and not the real deal.

One last quick comment: Any faltering of demand out of Asia ( India/China) will most assuredly allow gold to test support near $1240. India tends to buy ahead of its major festival but one wonders if that will be enough to offset declining interest in the metal elsewhere.

Western-oriented investment demand continues to be limp judging by the ETF, GLD. I narrowed the usual chart I have been posting to the start of 2013 so that you can see for yourself the lackluster demand for the metal. While some want to assert a bullish case for gold based on the lack of heavy liquidation in this fund that we have seen in the past, the problem is that there is nothing on the immediate horizon to replace that lost interest on the buy side.