Thursday, April 28, 2011

The Inflation Trade Bets

So last week I was able to profit on the euro and aud rises against the weakening USD. The rhetoric continued last night with Bernanke coming in with more excitement from his Goatie as he delivered the same broken record statement: "We are not suffering inflation, we'll keep our policy in check". He remains firm in that inflation is in check (although 40% of the core inflation is in US housing - but the other 60% is clearly ticking higher) - and that the moment inflation is an issue that they'll take steps to thwart it. He also implied that the external influences of inflation like oil are transitory; that's comical in itself.
We do however have seen that in a fiat-related economy, deflation is a near impossible event - unless of course you're Japan, where everybody is tight as5 and whores , I mean hoards their cash.

I added some heavy exposure to Gold equities in AUS (KCN) in Britain (ABG) and also took 1 contract position in Gold mini contract. The total additional exposure is now about 25k more, which is practically putting my gold bet at about 50% of my total risk.

The gold mini will probably be held with a tight stop, and the gold equities, could be a 3 month + hold.

trade KCN:

trade ABG:

trade spot Gold: