Is The Phili Fed Telling Us to Go Dark?

From Bloomberg:

Gold fluctuated near a seven-week high in New York as the dollar steadied amid investor concern on the outlook for an economic recovery.

The dollar pared gains to trade little changed against the euro as Germany’s Der Spiegel magazine reported that social tensions are rising in Greece as austerity measures hurt the economy, while the Bundesbank raised its growth forecast for Germany this year. Gold usually moves inversely to the greenback. The index of U.S. leading indicators may signal slower growth through the end of the year, economists said.

“The presence of uncertainty and risk aversion continues to be seen in physical gold demand,” said Filip Petersson, an analyst at Stockholm-based bank SEB AB. Negative U.S. data today will “certainly lift gold higher. On the other hand, an indication that the U.S. slowdown-fear has been exaggerated would be significantly bearish” for gold, he said.

Gold futures for December delivery added 20 cents to $1,231.60 an ounce at 7:58 a.m. on the Comex in New York.


Rapidly deteriorating manufacturing indicators from the Phili Fed have surprised the market to the downside. This is not a good sign given the high levels of layoffs that just came out. Unemployment continues to swell even though official numbers are static as those who have been out of work longest fall off the list.

Greece reached close to 120% debt to GDP ratio before the bond market forced austerity to kick in. Now we see rapidly increasing Greek unemployment reaching levels that are hard to fathom.

The US should reach 93% debt to GDP this year according to my calculations. We have likely already passed the point of no return based on Ken Rogoff's 90% debt to GDP benchmark. With these numbers, it is no wonder that gold is rising, and may make a breakout soon to the $1400 level. Farmland and a place in the country also look good to me at this point.

Now seems a good time to reexamine our priorities.

Some of these topics I have discussed previously in this blog:

A Year of Preparation

Managing Anxiety

Strategy 6 Spiritual Preparation

Strategy 6 may not be the most popular of my posts, but remains one well worth considering.

While there may be a good deal of difficulties to work through over the next several years, I remain optimistic about the longer term outcome as I mentioned in this post:

Who Are The Wolves?

A prudent man sees danger and takes refuge, but the simple keep going and suffer for it.
Proverbs 22:3