Well I guess the market is telling us we are not going to need anymore stuff. The dollar is way up, and we can all hang out and hug bundles of dollar bills as the system breaks down eh? Oil down over $4 so far on the day, WTF?

Money has been parked in commodities because there is nowhere else to hide. I am sure demand is slowing for most commodities and I suspect we have greater economic stress ahead before things start getting better. But this knee-jerk reaction to dump commodities and buy dollars is not any indication whatsoever that things are different today than they were yesterday. This is hot money spooked from one perceived haven into another.

Now going back 5 years, if you could have a do-over, what would you rather have: more dollars or more stuff? Today the market is telling us dollars are a better choice. I think not. Looking ahead 5 years from today I doubt that the overall performance will have changed. We can look forward to a much lower dollar and much higher commodity prices, even if slower growth is baked in. This sudden flurry of sell-everything-buy-dollars is what happens when traders succumb to fear and stop thinking rationaly.

The sentiment stinks. The end.

cheers!

mike