The US$ has rebounded nicely taking back a much of the losses it had suffered last Friday in what modest sums of trading took place anywhere in the world following the release of the US Employment Situation Report. The knee-jerk reaction to that report was precisely that: a knee jerk and seemingly ill-founded response that is now giving way once again to a stronger dollar across the board.
We maintain that the news last Friday was not nearly as ill as the initial response suggested, for the reality is that the US is running out of qualified, educated workers to fill the needs of businesses. We have a surfeit of unqualified, un-productive, ill-educated workers available to the market place, but they are unwanted, un-needed and wholly un-necessary.
Well educated, qualified, punctual employees, on the other hand, are in demand and are in short supply. Sadly, we fear that we may be in for a period of several months where the non-farm payrolls are barely above 200 thousand when we had become comfortable expending 250+ thousand month after month after month.
Regarding gold, we are and we have been and we shall likely into the future remain bullish of gold, but again we are not bullish of gold in terms of US dollars for we prefer being bullish of gold in terms of currencies we think shall be diminishing in value. We prefer “funding” our gold position in terms of EURS and of Yen and that has proven to be the far wiser decision over the course of the past nearly two years in the case of the latter and over the course of the past six months in the case of the former.