I have remade credit flow investor into a blog.

My original analysis holds true and long-term US treasuries have done well over the past 3 years.  Notice now how USD is also rallying due to USD being the worst currency except for all the other currencies.  Insurance gold 5-10% is still a good idea but I’m not a fan of gold as inflation remains subdued.  We continue to have ‘mild’ inflation but no high inflation or deflation (yet). Deflation will kill gold prices so it remains a risky prospect.

BTW, non-financial credit continues to grow at $2 for $1 of GDP growth (this would include student loans and gov’t backed mortgages which are growing rapidly now).  This value is down from $5 in 2007…if you can call this progress. Of course, $1:$1 is necessary otherwise you are simply borrowing from the future. As politicians would say ‘the future cannot complain.’

Next  year will be up/down with 3 month cycles as higher taxes and ‘reduced’ deficits lead to austerity style contractions.   QE3 shows signs of weakening but I have no doubt that should a recession arise in Q4 or Q1 that congress will initiate a new stimulus as QE does not primarily ‘recover’ anything. There’s a chance of QE3b in Feb as well.

All this may take a few months in 2013 to realize. The up/down volatility will continue until a new stimulus is entertained/austerity abandoned.