Fundamentals haven't changed, page-524

The problem I find when bringing politics into the fundamentals of whatever markets is the unpredictability of price reaction. I agree with you that private sector debt is not what people are focused on but national debt to GDP. I saw a video of Prof Steve Keen discussing private sector debt in the economic jargon to explain without fully understanding the message, I have never studied Econs beside reading Fin Review. My understanding is that regardless of national stimulus ie. low IR rates, property stamp duty reduction and all the engineering applied to encourage our spending excesses, the citizen's average debt burden is getting on the risky side of things without real wage inflation. In other words the growth of certain highly valued assets have outstripped the ability to sustain that debt.


The yield on this US10. The trend is rising so the market is in agreement that US IR has a good chance of rising soon complimenting the UDSX. So as you said AUDUSD top has probably formed and now it is now heading down with low 70s' a possibility. Fed's perceived bond holding reduction including not buying any more treasuries with the bond dividends will have an impact on the yield going forward.

1st chart, red NST; turquoise XAUUSD; green XGD

I randomly picked out the bigger cap gold producers and they are all in agreement with XGD which is logical with the way weighting is applied. XAUUSD is diverging from our local producers so I have watched this phenomena for some time and saw this correlation throughout my second foray into NST many years ago. It must be cheaper AUDUSD providing margins and revenue growth so intend to keep riding this trend ignoring the day to day volatility in XAUUSD. Along the way any big impact on the volatility of XAUUSD will surely cause some short term volatility in this sector before it reverts to the upwards mean as a guess.

My understanding is that a recovery in US economy with an expanding CPI inferring more IR rises is detrimental to gold allure. I am bearish gold currently but bullish gold sector in Oz a contradiction I guess. I wonder if a rising tide (US economy) will float all boats (incl Oz)?