Yesterday the Chicago PMI disappointed the markets, but nothing serious happened. Today the ISM Manufacturing being a little better than expectations inspired a rally with dollar gaining against euro and the Dow Average making a 5 year record.

Where it comes from the difference between the influence of Chicago PMI and ISM manufacturing? As we see there is a serious difference in today and yesterday's reactions. The answer is that this is just another prove of existence of strategic fundamental factors that pump the prices up. In already much instances we see almost no movements down on important bad news, and almost always a rally up on even not so important good news.

It is clear enough that the markets are just consuming the money print fundament. No way so much printed money not to create an inflation, including a stock exchange inflation. So markets are just waiting for an occasion to go up making the inevitable change in proportion between almost fixed assets and much increasing quantity of money.

Generally all markets are bullish in inflation situation like current one. But don't think you will make profit on rising prices. You will have more money but with less value of the money...

Dobri
May 1st 2012