Big moves in markets are always good days to think about whether your strategy is right or not. In essence, I am arguing that politically pro-labour policies are the only way forward, and this will continue to be better for commodities, and bad for financial assets. The Democrats doing much better than expected in the mid-terms are a sign of that. I expect more pro-labour policies to try and get more money to workers, and so I expect more inflation. My base case is that GLD/TLT will continue to perform well. Even with the rally in TLT that powered the move in stocks yesterday, GLD/TLT still looks great to me.
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