We are extremely comfortable that our prognosticating for 2012 may or may not work out. Which puts us in the same camp as most others. That said, a contrarian turn ahead of possible normalizing of the debt issues still with us that we suggested in December does seem to be gaining ground in the market. With that should come a greater focus on basic technical indicators like metal stockpile changes.

More mayhem, debt downgrades and a bank failure in Europe finally concentrated the minds of EU politicians, something the market has been waiting a year for.

Things turned hard in the markets since the last issue, and not in a good way. A lot of bad news has been priced into the market. At this point only time will tell whether that has impacted people hard enough to tip the slow growing developed countries into recession. Whichever way things go, it’s going to be close.

The latter part of this editorial contains comments on resources stocks and metals. Notwithstanding those comments, the current situation in Europe will overwhelm everything else in the market near term so we will comment on that first.

The many “typical” issues with downside potential that markets have been dealing are still some ways away from sufficient resolution to calm markets. One that has slipped off the economic pages, but is still causing much chatter on the political front, is the ongoing movement in the Arab world for changes of government. Though not as up front with the market crowd as when it began, it is still having its impact on markets.