joltin, i agree with both of your points. i think the t-bond's 2.6% yield has been driven so low by countries buying them for other than financial reasons. whether it is asian countries propping up their export markets, or arab oil producers recycling their petrodollars, i don't think it is sustainable. those who view treasuries as a safe haven would be better served with t-bills of very short duration to avoid the inevitable currency depreciation which i expect will be many times 2.6%.

i also expect mining shares to outperform bullion, and i was buying them back in oct and nov when their prices looked like the world was coming to an end. i didn't buy at the exact bottom, but we are already seeing the outperformance, and it is coming more from the larger companies than the juniors. with silver up about 20%, silver wheaton is up 145% and silver standard is up 180% from the lows. prices were driven so low by the selloff that the market caps of even well established companies looked ridiculous.

i think the catalyst for serious money moving into mining shares will be the fed creating money to stabilize the housing sector. i don't know if it will be successful, but the fed will try by creating the money, and that's all that matters. once the perception takes hold that there is no monetary discipline at all, i think funds will flow into inflation hedges, and gold and silver shares will benefit.