Everyone stupid enough to sell their gold and buy Treasury bonds is climbing out of the lifeboat and getting back on board the Titanic - guest on Fox BusinessI'm going to keep today short if I can. Sometimes once I start writing there's no telling how amp'd up I'll get. Obviously the jobs report came in significantly below the Wall St. Einstein forecast. Because these numbers are mostly make-believe anyway I won't go into them in-depth. But for the purposes of comparing make-believe to make-believe, the number of jobs Obama wants us to believe were created in May was 69,000 vs. the expectation of 150,000. Even more troubling was the big downward revision in April.
Anyone rooting for Ben Bernanke to print more money and Obama to borrow more to spend on "jobs creating" projects like Solyndra is one of the chickens in the coop cheering for Colonel Sanders...Dave in Denver
The highlight of the whole Disneyland affair was hearing Joe Kernen exclaim to Mark Zandi - CNBC's economic Einstein - "wow Zandi, how did you miss this so badly?" The fact of the matter is that I remember trying to read Zandi when he was a junk bond credit analyst back in the 1990's. I thought his work was so poor that it was entirely unreadable. In other words, he was a moron back then and he's a moron now. But I guess when the company you work for pays huge advertising fees, you get elevated to genius status on CNBC. Zandi isn't "big hat, no cattle" - he's "no hat, no cattle." Zandi has been wrong for past 10 years on housing, the economy and gold. Especially on gold.
It's all fairy tales and fantasy anyway, but when the fairy tale turns into a horror story - for real - you have problems. And we have big problems right now. The economy is collapsing - GM and Chrysler badly missed sales estimates, all the manufacturing data is coming in substantially weaker than expected by our resident TV Einsteins, like Zandi, and housing is doing another el cliffo.
But what really should be jerking people from Lego Land and into Friday the 13th is the Treasury bond market. The yield on the 10-yr Treasury is at a record all-time low and the yield on the 30-yr Treasury - the Big Daddy - is below it's lowest point during the Lehman crisis. That's not just warning signals flashing, that's the equivalent of financial nuclear air raid sirens going off.
What this means is that all liquidity is being sucked out of the global financial engine and it's going into Treasuries and precious metals. I suspect today's big move in both reflects the expectation that we may get a heavy dose of QE3 in some form - likely not an obvious, overt form - at the June FOMC meeting. Just like everything else going on in our system - of which the Obama farce and fraud is supremely emblematic - I'm sure our resident Talmudic scholar at the Fed, who masquerades as an economic expert, will do his best to inject as much electronically created currency into the system but disguise it in a way that the public will accept as nothing more than some temporary, "sterlized" lines of credit.
Trust me, that's a loan NO ONE wants to take unless they have a lot of physical gold and silver on the side...