Oil prices are on the rise. The dollar is on the rise. The NYSE is on the rise based on the stronger dollar and the expectation of the interest rate rise by the Fed in June. Surprised crowds cheer. Happy Days are here again. Really?
Summertime is vacation time is travel time is increased gas consumption time. Increased oil prices now mean travellers will once again allocate the money they could have spent on the substance of their domestic vacation to the fuel required to get them to their destinations. Foreign tourism? The exchange rate favors Americans going abroad, but doesn't contribute significantly to the American economy. American goods are more expensive overseas as well as for foreign travellers visiting the States. But...the value of the dollar is based on oil, so oil prices will save the economy in the end, right? Like duct tape on a leaky garden hose.
In the meantime, the stronger dollar has pushed down the price of precious metals. Some people point to an accusing finger and say, 'See? Told ya all that talk about gold and silver was a load of hooey.'
Which path into the future to take? The decision comes down to two decisions. One, believe in the power of duct tape without any doubts or worries and a readiness to apply more layers of the stuff as needed like tht garden hose that cost more to tape up than replace, Or two, see the duct tape for what it really is and seize the opportunity to own more gold during the price slump while it lasts.
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