I was watching the result of the auction on CNBC Europe and the results weren't received too positive either. In the wake of the results a very interesting discussion started, where financial commentators now seem to recognize that re-inflation may be playing a role in the recent increase of the stock indices rather than a real recovery.

It is only one step from re-inflation to inflation, so I would not be surprised if the S&P does not dive, but remains around the present level, while increasingly severe inflation gradually creeps into our daily living over the months to come.

Anyway, after tomorrow's auction we may see the final verdict of the market. I am still totally confident that Sinclair and Armstrong are right and that the dollar and T-bond market will start tanking and gold rising.