Oil and dollar: here we go again!

Forecasters can differ a lot, but some of the time, they reach opposite conclusions. Mr Prechter, of considerable reputation because of past calls, says the dollar has reached a major low and will rise for a couple of years. Uncommon Wisdom has called for a minor up blip to 80, maybe a bit above then a drop. T. Boon Pickens on the other hand, goes long on oil, figuring on oil going to $75 and $80 by year's end. Some pundits call for economic recovery, others fear a double dip recession.

I have felt that we should look at two things: fundamentals and what the government is doing to delay the inevitable. The Marxists in the Obama regime believe that they had figured out how to beat the system and intend to do so with the help of the Media that they think can convince people that black is white.

Their problem is that they deal with people expert in economics, rather than the dumbed-down witless urban Democrats. In other words, they will not be misled by the propaganda of Chris Matthews, or Begala or even the Ragin' Cajun.

With the Stock Market we saw the Golden Cross (the 50 DMA going above the 200 DMA) and knew that this meant a continuation of the rally that began in March, in spite of the ceaseless talk about a Bear Market rally. With the dollar we see the opposite, the 50 DMA falling below the 200 DMA. While we saw a slowing of the decline (and in fact we saw three up days), the dollar has yet to establish an up trend. Lately, the pattern has been that the down days are bigger than the up days. If the pattern continues, we should see a substantial drop in the dollar this week. A drop in the value of the dollar will force up the price of commodities, gold and oil.