You know that the markets have gone Full Bizarro when the threat of a central bank rate cut sends its currency soaring.  But, that is exactly what happened earlier in the week after a spate of economic data convinced the markets that the ECB would have to cut rates.  The Euro soared to $1.32 early this morning before the actual announcement by the ECB which then confirmed the market sentiment and cut rates by 25 basis points.

And then the Euro sold off back to $1.306 and stayed there for the next six hours plus or minus a few pips.  Gold moved right along with it and stopped moving more than $0.50 in either direction.

And who says the markets are not being rigged by the central banks?

The only thing that made any sense today was that oil prices rose in response to the ECB’s announcement.  Now that we have the BoJ, the Fed and the ECB all increasing their balance sheets again, commodity inflation should begin apace.  This is necessary to keep creating the illusion of exchange rate stability while the economies deteriorate around it.

These people are so desperate to create positive money flow that they will steal it first so they can spend it if you won’t.  That’s what Draghi means when he says he is open to ‘negative savings rates.’    And we’re supposed to respect these people?