The Resourceful Bear Blog

Introduction
The yen carry traders sold the USD/JPY driving it down from 110.70 To 108.83, causing the US Dollar, $USD, to fall, and gold, GLD, and oil, USO, to rise.

Mid-day financial market place trading was influenced by the USD/JPY
Here is the Yahoo Finance chart of USD/JPY as of Tuesday, August 19, 2008 close of day at 110.70: USD/JPY

Here is the Yahoo Finance chart of USD/JPY as of today, Thursday August 21, 2008, in the morning at 108.44: USD/JPY

Here is the ActionForex.com morning report today, Thursday August 21, 2008, entitled Yen And Oil Driving Forex Markets; which shows the USD/JPY having fallen to 108.83: USD/JPY

Here is the PFXGlobal chart of the USD/JPY showing the fall to the edge of a massive ascending wedge going back to March 18, 2008, when the Fed announced the bailout of JPMorgan and the provision of TAF, TSLF, and PDCF facilities. USD/JPY at 108.49 at edge of channel

Here is the Yahoo Finance midday chart of UUP reflecting the fall of the US Dollar: UUP

Here is the Stockcharts.com chart of the US Dollar, $USD, as of the close of trading yesterday August 20, 2008 at 76.94: $USD

Here is the midday Kitco.com chart of the US Dollar, $USD, falling from $77.10 to $76.10: $USD

Here is the midday Yahoo Finance chart of the gold ETF, GLD, showing a rise from Friday August 2008, spike down value of 77.63 to trading today at 82.00: GLD,

Thus we have confirmation that Friday August 15, 2008, was Peak Dollar.

Of historical note: July 25, 2008, was Peak Currencies.

Thus gold has now arisen as sovereign over all currencies.

Gold is now the measure and means of garnering and preserving wealth.

This is clearly seen in the ratio of gold to fiat measures of wealth:
GLD:VTI ... Gold is better than US Stocks ... GLD:VTI (note the rise from Friday's spike down bottom)
GLD:EFA ... Gold is better than world stocks ... GLD:EFA
GLD:TLT ... Gold is better than US Treasury bonds ... GLD:TLT
GLD:DBV ... Gold is better than the world currencies ... GLD:DBV

The Yahoo Finance five day chart of the overall US Market, VTI, compared to the financial sector, IYF, shows the US Stocks are basically unchanged from yesterday, and the financial stocks are 1.4% lower: VTI And IFY

Mid day Stockcharts.com charts
The EUR/JPY, FXE:FXY ... The yen carry trade, is basically unchanged at 1.621 FXE:FXY.
TLT ... US Government Treasury Bonds TLT The chart of the US government bonds is showing a bearish lollipop hanging man candlestick.
VTI ... Overall US Stock market VTI
IYF ... Financial sector IYF
GLD ... Gold GLD The chart of gold is showing a gravestone doji indicating the price of gold could actually fall some.

All currencies now to fall lower in a death spiral lower together; gold to arise as the defacto world currency and means and measure of wealth.
Elaine Meinel Supkis writing in Joe Bazooka Paulson Shoots Self In Foot writes that the US continues to refuse to hold much in the way of euros or yen. This is because we can depend upon our allies and trade partners and leeches to balance our currency one way or another. We are content to have no sovereignty over our own currency. No nation should allow other nations to hold such power over the national purse. Yet, not only do we allow the central bankers of Europe but also Japan, determine the value of our currency and to do so for their own benefit. Germany got caught in the gears because they fear a weak currency. This year, they are fully involved in weakening the euro".

This weakening of the Euro, FXE, began in late June 2008, as I documented in my article, June 22, 2008, article EUR/JPY Shows Bearish Dark Cloud Cover Candlestick. I wrote that "the chart of EUR/JPY, FXE:FXY, the barometer of the yen carry trade, shows a bearish dark cover candlestick which is presenting also as a lollipop hanging man candlestick. It looks like a great unwinding of the yen carry trade is at hand, with disinvestment in stocks and currencies to take place".

Then in my August 7, 2008 article An Elliott Wave 3 Down Commences In The EUR/JPY, I document that the currency traders heavily sold the Euro, FXE, the Australian Dollar, FXA, and the Canadian Dollar, FXC, the British Pound, FXB, and the Swiss Krona, FXC.

Now, the US Dollar, $USD, will be joining the other currencies in falling lower together.

Gold could fall once again to its August 15, 2008, $790 value. Neverthelsss, the result of today's trading is now clear, cogent and convincing: given that Peak Dollar and Peak Currencies have passed, gold is now the defacto world currency and the means and measure to garner and accumulate wealth.

EUR/USD Analysis
The BabyPips.com chart of EUR/USD from article Pick of the Day, shows a gravestone doji, indicating a weakening of the Euro, FXE, may be at hand: this could easily take gold lower again to the aforementioned $790 region.

Kondratieff Winter has arrived -- it will have manifest many political storms in addition to political storms
In a world of failing currencies, and falling stock value, international tensions will grow, small wars like in the Congo will become more frequent and global conflict expand to the point where World War III will happen, as the EU US Western World Government seeks to consolidate control over oil reserves in Iraq and Iran, with the pretext for war being a military strike on Iran, over its nuclear ambitions.

Tony relates that a huge EU US naval armada is gathering in the Persian Gulf: it will soon be put to use.