Now that the nonsensical notion that the western central banks were not going to print,baby, print to oblivion has been summarily dispensed with, gold and oil can get back to resuming their roles as the receivers of the central banks’ largesse to their corporate bank masters. Gold (AMEX:GLD) convincingly broke through the $1600 per ounce level during Asian trading Monday evening and the buying continued all through Tuesday, closing on the globex at $1617.75 per ounce. The bulls are currently in control of the market. The real test comes near $1650 per ounce. At that point the resolve of gold bulls will be tested again severely. But it Bernanke and the Fed want to sell the ramp-job of the S&P 500 (AMEX:SPY) into the election for the Drone-Bomber-In-Chief then he’s going to finally have to accept gold prices that reflect even 10% of the real price for the yellow metal.
In Oil’s case Brent Crude (AMEX:BNO) broke back over $100 per barrel on the report that the Iranians are both serious about and crazy enough to attempt to block the Strait of Hormuz in response to the numerous acts of war perpetrated against them on the part of the U.S. and the E.U. I’m no fan of Iran but they do have the right to buy and sell things that everyone else does, i.e. oil, on the open market. Financial sanctions aimed at changing the government of Iran is an act of war. Like it or not, if you support this course of action, then own it without soft-pedaling it.Previous Post » DJIA Losers of the Day: Home Depot, Pfizer and AT&T