Friday, February 19, 2010

The Daily Note - Whose Rate Is It Anyway?

I wonder who actually mandated a raise in our rates. This one quickly sneaking under the radar until it was released at a perfect spot on the horizon.

China has been worried about our worth. Since they own most of our debt and hold most of the gold (outside of Soros), but not enough to thwart our default,so they have a right to be worried. The way we go, so goes the world... for a while.

It's time for the USA to wake up that we are, like all people, replaceable. Certainly not right away, and certainly the world will suffer at our demise, nevertheless, we are replaceable. Another nation will rise to the top, if not already there waiting, almost ready to take our place.

It is fortunate that China still needs us to buy their manufactured goods and employ their workers, otherwise this house of a cards relationship would collapse. China's been complaining, USA's been discreetly listening to their wishes, because they own most of our debt.

The Fed said this raise does not mean they will raise again in March, but if the rate of inflation is beginning to loom big, they short on choice and we know which way that chase spirals. Since China wants to be paid back with stronger dollars they will keep the pressure on as well and the USA will have a hard time holding rate hikes back.

With jobless rates still at all time highs, forcing the banks into higher rates, small businesses will suffer further; the events if mishandled, could literally break our populations's back but perhaps that's the plan all along.

Rates and opex today should prove to be an interesting day.
Happy Trading, Living and Dancing (in the dark)

The Play List: GLD isn't everyone playing this today?

Posted 2/19/2010 07:23 Eastern