George Soros called an “ultimate bubble” in gold at Davos today, inflated by the ultra-low interest rates. I can’t say I disagree. The general economic malaise and uncertainty has pumped gold up bigtime, and it will steadily deflate as confidence returns (not to mention whatever machinations the central banks and IMF have going on in this area.)
In somewhat-related news, the Greek premier said the Euro is under attack by speculators. German economy minister Rainer Brüderler said that Germany will not be bailing Greece out, and that the Greek crisis may prove fatal for the Eurozone. This interview with Soros is also interesting.
I wrote about macro weakness in the Euro in April, where I advised shorting Euros against a basket of currencies with minimal emphasis on the dollar. The Euro is about the same versus USD now as it was then, gyrating wildly versus the yen, lower than the pound and the franc, much lower versus Aussie dollars, New Zealand dollars, and Canadian dollars. Anyone who took my advice then would be much richer today, and richer still if Greece goes bankrupt next week.