Hyperinflation? Not in Airline Tickets

Even with oil north of $60, airline tickets are incredibly cheap right now. This latest example of price deflation just popped into my Inbox, courtesy of Jet Blue:

Related reading: When will price deflation turn into hyperinflation?

Gold Stocks Weakening...Ominous Sign for Bullion?

Breakfast was easy this morning, as I continue to wipe plenty of egg off my face from my recent deflationary call on the markets.

I moved my wife's 401K stash from gold stocks into pure cash, as I thought gold was looking toppy and not acting well. Since that time, gold fell a bit, and has since rallied. This morning I saw gold over $950, and thought I'd better recheck my hypothesis.

While gold itself has held up alright over the last month, gold stocks have not - while always leveraged on the price of the metal itself, they've seem to especially be leading the way down over the past month.

In the spring, gold stocks lead the way UP...they now appear like they could be leading the way DOWN.

Gold stocks (red) seem to be leading gold (blue) on the way down.

The next few weeks will be interesting, as the stock market rally appears to be weakening, at least from a technical standpoint (we're overbought here in the short-term). Let's see what happens to gold, and we'll find out if gold stocks have foretold the future, or are merely sounding a false alarm.

Marc Faber: You Don't Want to be in Cash

Just caught the latest Marc Faber TV interview on Bloomberg. Some quick notes on his thoughts:

• Believes the March 6 stock market lows were major lows for awhile

• If the S&P drops towards 800, we'll see new stimulus plans and loose money...and if it drops towards 700, we'll see even more...thus the lows are likely to hold

• The economic recovery will be very disappointing

• You don't want to be in cash or bonds, due to inflationary concerns

• Gold is attractive as a hedge against inflation

• Thinks the dollar and bonds could rally in the near term, but longer term, he's looking for a weak US dollar and strength in commodity prices

You can watch the full interview here.

Marc Faber is one of the sharpest investors in the world, and is author of the excellent book Tomorrow's Gold: Asia's age of discovery.

For an interesting counterpoint to the hyperinflation fears, check out my recent piece: Is Deflation "So 2008"? Hyperinflation Trade Looking Crowded