The markets always win

The Telegraph - France is in talks with the United States and Britain on a possible release of strategic oil stocks to push fuel prices lower, French ministers said on Wednesday, four weeks before the country's presidential election.

The reason commodities have been rising is because of negative real interest rates - short-term interest rates below inflation. In other words, because of excessive monetary stimulus.

Releasing strategic oil stocks does not solve the problem. The problem has been created by cheap money.

Eventually higher commodity prices will cause the economy to slow down and commodities to decline.

The markets always win.

George Dagnino, PhD
Editor, The Peter Dag Portfolio. Since 1977
2009 Market Timer of the Year by Timer Digest

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