I'm just guessing here but I think the dollar rallying back above the 200 week moving average and rising unemployment are going to be the most important themes of 2009. Both are deflationary.
Until I see the dollar move and hold back below the 200 week moving average I'm going to assume that deflation is the name of the game for now.
Actually as long as unemployment continues to rise I don't really expect any easing of the deflationary pressures. So I have my doubts that we will see the dollar back below the 200 this year and maybe not next year either.
As a side note; I expressed my opinion in a prior post that gold demand would drop in a global slow down since the largest use of gold is in jewelry. It appears to have started.
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