by Kelsey Williams
GoldSeek
Bond prices collapsed nearly 3% post-election and are down 12% since mid-September. Whatever that tells us did not change because of election results. The action in bonds is contradictory to the prevailing assumptions of a melt-up in asset prices because of expected lower interest rates, more cheap money and credit, and a collapse in the dollar. Speaking of the dollar, it was up almost 2% on foreign exchange markets since late Tuesday evening; and has gained 5% since early October. Finally, the price of gold fell sharply and is down $100 oz. since Tuesday’s close.
The action in bonds might not imply a credit collapse at this point, but it certainly doesn’t offer positive confirmation of higher stock prices, lower interest rates, and cheaper money and credit. The action in gold and the dollar is consistent with what is happening in the bond market. The price action in all three is contradictory to Fed attempts to lower interest rates. Keep your eye on the bond market and the U.S. dollar. – END OF POST-ELECTION COMMENTARY
