In case you are not sure, we are in a recession

Michael Shedlock from Mish's Global Economic Trend make a great argument that the top 20 countries in the world are all in recession with the exception of China (Global Recession, Country by Country). And he suggests that China will not be able to go alone (he also referenced an excellent read: Robini's recent article on China's hard landing).

Let's think about how we are going to come out of this global recession. I think that depending on how bad the recession is, government maybe able to push for responsible lending regulations with nationalization type of overseeing in credit lending. If done correctly (especially if co-ordinate with all G20 governments), the long term economic stability will have a good chance. On the other hand, if depression hits any country, they will push for the competitive devaluation of their currencies, massive monetary injection plus government spending to boost jobs and therefore the domestic economy. The world will end up starting another round of pushing paper money around.

We, of course, argue it will all end badly and Gold will be the long term hedge of that scenario.