A VIew From the Trenches: Is the Dollar Going to Roll Over Here?

This week's action has been a pure paper-driven cartel smack. The gold lease rates creeping higher are testament to the supply squeeze, especially the one in Asia (Shanghai premiums are an unheard of $10+ over spot, Viet Nam $30+).  If the big physical buyers start to look for big supply below $1100 and it's not there, we could see a moon-launch in the next few weeks. China doesn't want paper, nor does India, Viet Nam, Russia, etc. Also, I'm not going to go out on a limb and call a dollar top here, but the momentum indicators are starting to roll over and there's some decent resistance at the 78.70 level/200 (simple)dma, which is where the dollar ripped in reverse yesterday. Our spineless leader's empty tirade against Wall Street yesterday may do nothing more than stimulate even more "diversification" away from the greenback.

Furthermore, we now know that the intent of our Government is to spend its way into AT LEAST a $2.2 trillion deficit this year, which is reflected by the year-end debt limit ceiling raise by $300 billion PLUS the additional $1.9 trillion debt ceiling raise being superficially debated in Congress.  That's the minimum spending deficit this year, as States will need billions in loans and Unemployment Benefits will no doubt be extended.  To be sure, Government payroll (of which Extended Unemployment Insurance beneficiaries are a part) may be the only source of Democratic votes in November. Anyone who looks at that picture and thinks the dollar can go higher from here is taking too many hits from the bong.

One more point:  I'm horrified by the lack of public outrage over the Supreme Court decision yesterday upholding the right of big business to spend as much as they want getting their people elected to Congress/the Presidency.  That pretty much seals the transition of our way of Government from democracy to fascism:

“Fascism should more appropriately be called Corporatism because it is a merger of state and corporate power” - Benito Mussolini