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<p>[QUOTE=&quot;Ainslie Bullion, post: 2225627, member: 75209&quot;]In the first of the scenarios we discussed yesterday, we touched on the correlation between rising Discount Rates in the US courtesy of the Fed and the USD falling.&nbsp; This is contradictory to a lot of commentary that predicts a rising USD this time.&nbsp; Over the last 42 years every time the Fed has increased the discount rate the USD has declined 10-12% and as discussed yesterday there is a strong correlation between a falling USD and rising gold and silver prices.&nbsp; Check out the chart below for silver.</p><p><br /></p><p>Some might be thinking however that a falling USD will mean a rising AUD as in the recent past there has been a decent correlation to that effect.&nbsp; However the current market forces need to be considered.&nbsp; Last night we saw another crash on Wall Street and the USD coming off.&nbsp; But the very same cause of the crash also saw the AUD come down to just 70c.&nbsp; Why?&nbsp; Because it is the troubled Chinese economy (last night was due to bad manufacturing data) that looks like it might be the ‘prick’ for this unprecedented global financial assets bubble.&nbsp; Anyone listening to Ross Greenwood on Today this morning or indeed most commentary&nbsp; knows Australia is in for a very rough period ahead as the mining boom is over and we have little else to give us real growth.&nbsp; Canada is a worrying preview of what we have ahead of us.&nbsp; So there is little support for a higher AUD and indeed most are calling 60’s.&nbsp; That is good news if you own gold and silver as you get the double whammy of a likely rising USD spot price, turbo boosted by a falling AUD.&nbsp; It potentially becomes a triple whammy for silver holders as the gold silver ratio is so high.&nbsp; The charts below show clearly the more volatile nature of silver – seeing higher highs and lower lows.</p><p><br /></p><p><img src="https://www.ainsliebullion.com.au/Portals/0/three-graphs.jpg" class="bbCodeImage wysiwygImage" alt="" unselectable="on" />[/QUOTE]</p><p><br /></p>

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