This coming week: No action planned. The general capital flows are into US equities and currency, out of emerging markets and their currencies, and out of the government bonds generally. Commodities and energy sectors are strong.
One can start to smell the cordite just starting to burn, where confidence in government debt declines and finally collapses, and there is simply no bid in the end game. That has already started in some emerging markets, and should move into Europe and Japan over the next 12 to 24 months. For an example of what it could look like in the coming years, is Venezuela where inflation is running at 300% monthly. Their currency is worthless. And they have the worlds largest oil reserves! Amazing how a society can simply eat itself alive, when the value structures breakdown at the individual level. We should all take note!
The sector weightings are currently as follows:
1. 65% LONG Precious metals sector
2. 12% LONG Metals and Mining
3. 13% LONG Uranium Stocks
4. 9% LONG Agriculture Commodities
5. 1% Cash
Last weeks chart depicted the big fall in bond markets ahead of us. This will drive interest rates globally higher, and start to kick off more sovereign debt defaults initially outside and then inside the USA. The elephant in the room is sovereign debt, and the insurance policy is precious metals and tangible assets, including equities, outside the banking system.