JUST BACK FROM VIRGIN ISLAND WITH MY SEPTEMBER:
As you know we believe the Fed will raise interest rates from near zero – free money – to normal market rates an 1/8th to 1/4 point a time – raising money costs for the coming five years – back to market rates.
As the world with TRILLIONS of US Dollars residing in high return positions – see’s – an ability to make market rates in the best guaranteed returns – the USA – return of so many billions will flow into the dollar – now moving from zero itself still by far the stronger currency – moving the US Dollar higher – for years – securing how strong the US Currency position is – and gas relative to dollar pricing will go down – but only in relationship to US DOLLAR buying power which will move back up –
This plan, secures dollar dominance as world trade currency, while assuring the hidden tax from wild speculation on oil prices is defeated will speculators loose a trillion dollars trying to protect their criminal profits and loosing as they try to manipulate the markets. Producers have had it with the speculation. . Iran coming back into full oil production and the family of nations, will further remove price pressures and other nations are expected to follow in this producer group. A shift of major proportions is going on removing unwanted commodity price manipulation due to speculation we often write about in our blogs here – from the future market space. It took years to factor in this speculation cost and it will take years to remove this unwanted influence to market prices of nations.
We believe profit taking in stocks will take place, but over all “free money” in the market is a manipulation to stimulate – but is not a long term solution. Free markets will absorb market rate money supply costs, and prosper along side of that move in our opinion. So we believe following some profit taking the equity side will remain strong in the remainder of this decade fueled in no small part by American inventiveness.
Wild cards include Greece and other unstable EU economies that spend over 100% more than they make by huge ratio’s – always unsustainable for a house hold or a company – or a nation. Watch these shake outs as the EU could be rocked and that remains a huge wild card to world and global recovery. Unpredictable till the EU gets its own house in order and the rest of the world can only watch. It can only be resolved from the inside EU out …..
We remain bullish on the economy globally and in the US specifically.
Berny Dohrmann – CEO SPACE May 31st Next event