I'd like to be bullish

As a summary of where the US is, this is the most succinct I have read.

It is the nature of opposition that it seems easier and more enjoyable to deconstruct arguments than to support them and rally round (hence the odd situation where the Tories dominate the blog world and Labour have no credibility). However, I am struck by the lack of intellectually rigorous, convincing arguments for society being able to support (let alone repay) the debt mountain we have created.

Although we are printing money at a rapid pace I currently believe deflation remains the issue and that bond markets will likely limit governments borrowing capacity before inflation takes hold. That suggests restructuring/default at some point. I shall be interested to see where G20 spreads trade over the next 6-12months.

Although I am intrigued by the technical argument that gold will trade back down to 600 before the mother of all rallies, I am increasingly swayed by its resilience at these levels and the longer this 2nd primary wave counter trend in equities goes on without a gold correction the more I think gold is in strong a bullish move. It is the de-facto global currency, when currencies collapse it is the only safe haven that meets the key criteria of money.

And I like this as an analysis of US debt, what we are likely to see in 2009 and why the government effectively has the mandate to ignore the law (if it has) in its prosecution of the war on recession.