Inflation Concerns

Nowadays, there are numerous signposts indicating that inflation in the United States is getting out of control. The US M3 money supply is 14% higher than a year ago, its fastest growth rate in 35-years, the US Dollar Index is plunging to 15-year lows, gold is surging toward $725 /oz, a 28-year high, crude oil is cruising above $80 /barrel, wheat prices have doubled to $8.75 /bushel, an all-time high, and the Baltic Dry Freight Index has zoomed 300% higher to stratospheric levels.

The Federal Reserve's first interest-rate cut in four years has weakened the dollar and sparked inflation concerns, analysts said. The Fed cut its benchmark interest rate on Sept. 18 by half a point to 4.75 percent. My forecast Sept 8 for a .5% rate cut was correct. I was wrong to anticipate a selloff on the news but I still am looking for a 50% retracement of the last move of the HUI.

``The decision to no longer be concerned about inflation has sent the dollar dramatically lower and gold dramatically higher,'' said Dennis Gartman, economist and editor of the Suffolk, Virginia-based Gartman Letter. ``The Fed has unleashed an inflationary force.''

The best way to become a millionaire is to borrow a million dollars and have your renters pay it off.
Jack Miller