While the massive drubbing across risk assets has modestly subsided, the global investing herd has finally realized that in the absence of shifting money into bonds (or even in addition to), there is a certain shiny yellow metal that may be just as good a store of value (granted, inedible) that despite a lack of cash flows (and who needs cash flow in a fiat based exchange system which will soon be wiped out anyway), is probably just a good substitute and as of this night is providing 1761 reasons as to why it is becoming increasingly obvious that if anybody listened to Hugh Hendry's presentation from last year in which he suggested people panic, it is the central planners. Should the Fed proceed with announcing QE3 tomorrow in the form of Operation Twist 2, gold will likely resume it vertical ascent to $2,000 which may be breached as soon as Friday. Alternatively, should Bernanke keep mum and disappoint everybody, all bets are off, across every single asset class.
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