Great GDP number today, and let's hope we hit a nice, long string of such numbers in the quarters to come. But I suspect the growth of almost 6% is due to things like government spending and inventory restocking, so we'll just have to see.
Normally I don't pay much attention to "big picture" things in picking my portfolio positions. Most of the time these news events are "noise." Most of the time, but not all of the time. In President Obama's State of the Union speech, he mentioned wanting to increase exports. I think he'll pursue that with a weak dollar (and to be fair, I'll point out that President Bush had a weak dollar policy as well), which leaves me feeling good about devoting so much of my portfolio to gold. There are other reasons I feel good about that, but let's get to five items you might wish to check out this weekend.
- The Senate voted on Thursday to raise the nation’s debt limit to $14.3 trillion, a $1.9 trillion increase that would allow the government to keep borrowing to cover operations beyond the November election. The way the word "trillion" gets thrown around is amazing, and a bit scary. Someday, sometime, somehow, the piper will get paid. I don't know quite how, but this too leaves me feeling good about my gold positions.
- Allan Meltzer argues in The Wall Street Journal that the Fed "exit strategy" to prevent future inflation won't work. "When will inflation start? The date is uncertain. But the triggering event will be either a sustained increase in bank lending or a large increase in Fed purchases of government debt. Perhaps both. Either one would trigger a sustained increase in money growth." I don't know if we'll see inflation or what. Yet the long-term trend for the US dollar looks down. And this too leaves me feeling good about my gold positions.
- Gillian Tett writes in the Financial Times that calls for a new Bretton Woods aren't all that crazy. "But the key point that investors should note is that Mr Sarkozy has probably smelt the wind: the issue of currency volatility is now hovering around the political agenda." Currency volatility mixing with politics leaves me feeling -- all together now -- good about my gold positions.
- Portfolio holding Microsoft (MSFT) announced good results, with profits jumping 60% for the latest quarter. You'll recall I recently lightened my MSFT position. Yet it remains a full holding, pays a decent dividend and should prove to be a good investment this year.
- Get Rich Slowly is a great personal finance blog, and recently posted about "Great Lessons from Great Men." "Recently I’ve begun to read a different kind of money book in my spare time. I’ve discovered the joy of classic biographies and success manuals, especially those written by (or about) wealthy and/or thrifty men. When I read about Benjamin Franklin or Warren Buffett or J.C. Penney, I learn a lot — not just about money, but about how to be a better man."