Tuesday, September 14, 2010
I would recommend you panic.
The first of the asset managers or TBTF banks who are out of Treasuries will look for a place to park their cashâ€”obviously. Where will all this ready cash go? Commodities. By the end of that terrible day, commodites of all stripesâ€”precious and industrial metals, oil, foodstuffsâ€”will shoot the moon. But it will not be because ordinary citizens have lost faith in the dollar (that will happen in the days and weeks ahead)â€”it will happen because once Treasuries are not the sure store of value, where are all those money managers supposed to stick all these dollars?