$455.58

That' s gold's 2005 high, also gold has come under its rising tredline formed from 2001 lows.

Knowing the FED has added record amounts of liquidity, and Bush's STIMULUS package, and we have witnessed a record easing with 45 lows in interest rates, and HERE we sit with gold NOT EVEN above its 2005 highs let alone its all time high??!! What gives?

NOT outright DEFLATION, but a deflationary trend is at work, SUCKING UP the liquidity, giving us a FLAT Y/Y money supply growth. And we are needing ever more increasing amounts to get the same bang for our tattered buck.

IMHO, we will see the yield on Bonds and Treasuries trade in a range to up until next job report where I believe will turn down hard with lessening effects of NET BIRTH MODEL, and the BEAR MKT will again begin to exert itself.

The rally now afoot means nothing to me, I am more concerned with larger trend and when it might resume.

D