The rehearsal of Global Currency crisis is over today 28/Sept/11

Asset across the board are rising today [27 Sept 2011] .Gold

What the news are not telling us is
that there was a mass scale liquidation that happened in last 3 days .
All assets including gold , oil , stock fell by massive % .

While the media was busy proclaiming that gold rally is ending and news
like that it did not for once tell us of the liquidation with the big L
that happened over the weekend .

Oh yes there was flight to safety towards USD . But from where and why ?
It was from European banks .

You might have read news that central banks of various countries are creating dollar funding facilities for EU banks .

There was also a news few days before that French banks are struggling for funding .

Also that Siemens moved its 500 million Euro into ECB account .

Connecting many dots like this . What we just witnessed is liquidity
squeeze on European banks , including those not from PIIGS nations .

Without getting into reasons and ethics of this . The point is it was a
controlled rehearsal of grand scale on what bank aka currency crisis will
look like .

Now news are flashing that all markets are up on euro optimism . I feel they are right . With this grand rehearsal there ought to be some TARP like bailout announced by EU and ECB . Which can effectively lead to rally . How long that will go on , we dont know for sure . But end it will in very short time is sure .

A country that have debt in multiple of its GDP spends equally big amount in interest payments on that debt . So crack such an economy is a must . Either by devaluation of massive kind or by default . Take your pick .