Cart Before Horse

Trams pass through Paradeplatz in Zurich, the center of the Swiss banking industry. Photograph by Mark Henley/Panos

In the short-term, the prospect is for deflation in the United States and Europe despite the immense amount of money creation by the Federal Reserve, and the 1 trillion euros through two LTROs. So, commodities including gold appear to be a poor investment. Deflation will make the dollar strong in the short-term.

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