You're insane if you don't own gold, investors told (dollar heading for "oblivion")

Robin Griffiths, a technical strategist at Cazenove Capital, told CNBC: "I think not owning gold is a form of insanity. It may even show unhealthy masochistic tendencies, which might need medical attention."

He added that the dollar was heading for "oblivion".

Mr Griffiths predicted that gold's 10-year bull run would continue and even intensify. "Although it's been a top performer for each of the last 10 years, it's still in a linear trend," he said. "Eventually it will go exponential and make more in the last little bit than the whole of the 10-year trend."

He said investors should regard any short-term falls in the gold price as a buying opportunity, adding that gold was still not an "over-owned trade".

His comments come against the background of the US Federal Reserve's huge monetary stimulus from quantitative easing, which many believe will result in inflation and a fall in the value of the dollar.

Read the rest here.

A tad more apocalyptic than my own view. But yea, gold is financial catastrophic health insurance. When central banks are printing money like its going out of style this is a no brainer.

Central banks start to abandon the U.S. dollar

There are those who would argue that the financial crisis was caused by over-enthusiastic worship of the Almighty Dollar. Call it brutal financial karma, but that church is looking pretty empty these days.

A new report from Morgan Stanley analyst Emma Lawson confirms what many had suspected: the dollar is firmly on its way to losing its status as the reserve currency of the world. We already knew that central banks have preferred gold to dollars, and that they're even selling their gold for cash; now, according to Lawson's data, it seems that those central banks prefer almost anything to dollars.

Lawson found that central banks have dropped their allocation to U.S. dollars by nearly a full percentage point to 57.3% from 58.1%, and calls this "unexpected given the global environment." She adds, "over time we anticipate that reserve managers may reduce their holdings further."

What is surprising is that the managers of those central banks aren't buying traditional fall-backs like the euro, the British pound or the Japanese yen. Instead, she suggests they're putting their faith in other dollars - the kind that come from Australia and Canada. The allocation to those currencies, which fall under "other" in the data, rose by a full percentage point to 8.5%, accounting almost exactly for the drop in the U.S. dollar allocation.

Call it diversification, if you must, but the trendline indicates that central banks are finally putting their money where their anti-dollar mouths are. The dollar has been in free-fall since 2007.

Read the rest here.

Hat tip: Serge

What Quantitative Easing Means in Pictures

Someone in the Federal Reserve pushed a button today and created another $7.7 Billion out of thin air and went shopping. What did they buy with their newly printed money? U. S. Treasuries (7 and 10 yr notes). Now in fairness this is loose change. But it's part of a pattern of behavior. The Federal Reserve has resolved to keep the Treasury in money even if they have to print it and buy their bonds to do it. This has been going on since March with predictable results.

The dollar is plunging in value against other currencies and there are already worrisome signs of inflation creeping into the core CPI and the price of commodities and commodity based equities are rising. Also we are starting to see movement by large institutional investors into traditional safe havens like gold which has been rallying (gold was up $12.00 oz today). For those who don't have the appetite for long and admittedly dry articles on macro economics some witty illustrations have been appearing of late that seem to cover the essentials.

They say a picture is worth a thousand words...