Arnold’s Ramblings 2-8-2011

Hi,

Arnold is finally feeling better after weeks of pain and suffering.

The Egyptian “crisis” is being ignored by the markets. If Egypt is taken over by the Muslim Brotherhood, I do not see this as good news for the United States or Europe.

There are two major themes that appear to be quite significant for at least the next several months. First, gold and probably oil will rise significantly and 30 year Treasuries are going to fall, the yields will rise significantly. Insofar as equities, that is less clear.

Apparently, Nobel Prize winner Paul Krugman has blamed the Egyptian crisis on, what else, global warming. According to Dr. Krugman, the effects of global warming are just beginning and prices of foods are going to soar because of global warming. Maybe the fact that hundreds of millions more of the Chinese and Indians buying wheat, et al has no effect on pricing. And maybe the use of corn for ethanol has no effect on food pricing; it is just global warming or global colding or just climate change. Isn’t climate whenever the climate changes? And Arnold does not know a place on earth where the climate does not change at all. But then what do I know?

President Obama spoke to the US Chamber of Commerce suggesting that he favors a corporate tax cut and less regulation. I am confused (as usual). Isn’t President Obama who significantly increased regulation? And isn’t President Obama who is still attempting to increase regulation on carbons, oil drilling, coal, financial institutions, and more? If President Obama cuts corporate tax rates and reduces regulation this will probably increase employment.

The DJIA appears to be lifting off to the moon. At some point soon, this rise will end. It is unsustainable.
Gold is starting to rise on significantly increased inflation concerns.
Oil has been falling back to the mid 80’s. It should start to rise again.
Interest rates on 30 Year Treasuries are now well over 4.7%.
The dollar is still falling.
Real estate pricing is still falling in most markets.
The economy still does not look like it is roaring back.

Arnold
Disclaimer: Arnold’s Ramblings Inc. and/or its writers, representatives, employees, shareholders, executives and affiliates may have a financial interest in any security recommended to readers or otherwise mentioned. Nobody associated with this website or Arnold’s Ramblings Inc. is a registered investment advisor. Everyone should review investment materials in detail and with due dilligence when possible, and should consult proper counsel prior to investing. All information and advice presented by Arnold’s Ramblings Inc. is believed to be accurate and reliable when posted, but cannot be guaranteed.

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