Yields and Some of the Things They Influence

Long-term yields bumped up today…

This of course bumped my position in the T-bond bear up.

It bumped my position in the Regional Banks iShares up.

It bumped Uncle Buck as well. In fact, the buck is breaking above a comfort point into a discomfort zone for USD bears. We’ve been noting in NFTRH reports that it was not going to be easy to kill the reserve currency. But man this thing has staying power. It also remained intact to its uptrend by not making a lower low to March.

Gold went the other way as it takes the needed pullback. NFTRH 561 reviewed the pullback targets on Sunday. Many think rising interest rates are good for the USD and bad for gold. That is often true, but…

The strong dollar is only a problem for gold if the yield curve gives way, flattens again and politicians from both sides of the isle manage to conspire with the Fed to somehow navigate the Good Ship Lollypop back to Goldilocks territory (I don’t know where Goldilocks is from; but I don’t want to go there).

So the curve is still elevating and only US dollar obsessed gold bugs would be fearful as long as that is the case. Yield dynamics matter more than what one currency out of a basket of these tramps is doing. The YC is still normal to a steepener but if that changes gold bulls should be ready to change as well. If these pigs somehow manage to control the yield curve all bets are off. So the chart directly above is important.

Meanwhile, these charts have bounced back toward Goldilocks territory after the deflationary jitters that were going around in May and June. But they are also candidates to keep going up into inflationary territory.

Okay, somewhat disjointed post ends now. I have to cook dinner. Later.

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