Morning Call [8:43am ET] “analyst65” posted “Greek Prime Minister talks about Greece’s Debt on Camera” and gives this link to a CBC Canada interview.
http://www.cbc.ca/video/#/News/TV_Shows/The_National/ID=1526607242
This 10:26 clip is well worth watching in that a leader of an embattled country has come clean about the fraud perpetrated by previous administrations of his country regarding economic data that traders have relied on.
At 2:45 in the clip, PM Papandreou admits that the official Greek government estimate of 2009 deficit to GDP at 3.7% was in fact 9.9% higher at 13.6%, which he says is a case of fraud by his predecessors against the nation’s creditors. Further, he says he intends to have his parliament pursue the legal ramifications.
At 9:08 in the clip he is also clearly upset by Wall Street’s conflict of interest regarding fair and honest analysis. In another interview recently he claimed that Goldman Sachs misled his government and will be sued.
All this makes for wonderful politics on the eve of the G-20 meetings in Toronto, but it is possible, I think, that the forthrightness of the Greek Prime Minister may cut deeper. He is in effect telling the independent traders of the world to not trust either government or Wall Street, and that fraud is the problem. Where this discussion is headed then is to a further polarization and eventual confrontation between the general public and the world’s monetary authorities and bankers.
The motto “Trust no one, but certainly not your banker or your government” is unlikely to bring us stable markets any time soon. Moreover, you and I are not the problem.
I think, with the help of Papandreou, the ball is now in their court.
This morning, starting at 2:00am ET, there was a reversal of money flow into US Dollars. Precious metals, commodity prices and equities softened as a result.
There has been a lot of hype in the world media about China’s intention to free the Yuan. When this latest story first appeared in the Western media in mid-week, there was tacit approval in Beijing, but after the story took on legs, the Chinese monetary authorities downplayed it. Still, the Western media raised the hype to a crescendo so that the futures markets started yesterday with wide gaps all over. The $USD plunged and equities, commodities and precious metals soared. I think this was a fraud by those who have vested interests in seeing higher market prices for equities, commodities and precious metals. Moreover, I think the Chinese monetary authorities have not acted in such a cavalier fashion as to hype their intentions.
Where is the common sense in today’s world? As I see it, America is destroying itself by not reining in these market fraudsters.
Have a great day.
CTA Trading Desk Post-Close Report
China’s apparent decision to allow for wider yuan fluctuation against the US dollar ignited an upward surge in world equity markets early Monday morning. The S&P hit our oft discussed resistance level of 1130 on the opening bell attracting rather aggressive profit taking, selling gaining steam as the auction rejected prices at roughly the 50% retracement of the decline off the April 26 highs and just beneath the 50-day moving average. After falling -2% off early morning highs the market bottomed in late trade, bouncing feebly into the close (S&P-0.39%) in lackluster volume on this Summer Solstice session.
Gold (GLD-1.94%) hit a new all-time high before reversing back below the double top of 122.50 – a near-term sign of vulnerability – prices immediately dropping to touch the uptrend line off recent lows. Violation of this uptrend line will provoke further selling; many traders have noted repeated weakness in precious metals prior to the release of Fed policy decisions. Given the strong reversal from all-time highs it makes sense to expect additional turbulence into the FOMC meeting scheduled for Wednesday. If the Fed reiterates that its low interest rate policy will continue for the foreseeable future, we would expect precious metals to pop higher after the news is announced.
Any decline in the S&P to the 1080-1085 area should lure buyers back into the market; resistance above remains 1130 and 1150.
Have a great evening.
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Comments
Cara 100 Ratings Changes
Good morning. Not much on the big boys so far:
XOM - PT Lowered from $60 to $48 @ Benchmark. Sell
--------------
What? No AAPL Upgrades?
--------------
Monday Morning Market Music:
http://tinyurl.com/3yps9lt
Re: Cara 100 Ratings Changes
Interesting. That's a pretty big change for XOM.
By the way, thx for putting this out there. I watch for you post almost every day.
Gold/Silver Ratio
Cattleman Ross -
"I just can't find a rational reason that there is some constant ratio between two disparate metals with little interchangability. There is some substantial subtitution between aluminum and copper but I'm far from convinced that gold and silver have anything in common." - Ross
You need look no further than the U.S. gold and silver notes, redeemable in the metals, of the 19th and 20th centuries. Or how about Williams Jennings Bryan 1896 Cross of Gold speech in regards to bimetalism:
http://en.wikipedia.org/wiki/Cross_of_gold_speech
History gives us gold and silver coinage through millennia and the consequences of debasement. How's that for interchangability.
Ambrose Evans-Pritchard last night on the issue:
http://www.telegraph.co.uk/finance/comment/ambrose...
GSK: German drugs gatekeeper rejects Avandia pill (from Friday)
FRANKFURT, June 18 (Reuters) - An influential German drugs watchdog told health insurers to stop paying for GlaxoSmithKline's (GSK) (GSK.L) Avandia, which could speed up a decline in sales of the controversial diabetes pill.
Germany's Federal Joint Committee of doctors and health insurers, which makes widely followed recommendations on reimbursement, cited bone fraction and heart risks associated with Avandia's class of drugs.
Sales have been declining sharply since controversy over the drug's heart risks first emerged in 2007. Sales of Avandia products fell 16 percent to 771 million pounds ($1.14 billion) last year.
"The committee's course of action is not justified neither from a medical, nor legal point of view," the drugmaker said in a statement.
However, the committee's chairman Rainer Hess said: "There are other pharmaceuticals that have no such side effects and long-term risks. We believe that patients should be protected against useless and, more importantly, harmful therapies."
$GOLD or 4.58 shares of AAPL
Trying to come up with some ideas relative to two well hyped investments, I constructed a chart of $GOLD:AAPL as linked below. Kramer hypes AAPL most every night. Relative to gold,
I just saw an advertisement this past week that will let you buy a 1 oz. coin on time. Yes, that's right they are financing consumers to pay $10.00 per week or month or so forth to own an oz. of Gold. This is the most innovative marketing technique that I've seen to push gold on the public. Even better than the Dubai gold vending machine.
Both $GOLD and AAPL hit new highs last Friday. So here is the puzzle. An ounce of gold or 4.58 shares of AAPL for the same price? I'm going with AAPL for the longer term trade. So will check on this "bet" same time next year to see whether it was viable.
(Note, both seem a bit too hot presently but the info might spur discussion.)
http://stockcharts.com/h-sc/ui?s=$GOLD:AAPL&p=D&b=5&g=0&id=p92984721805
deZev
p.s.
Would rather own 39.57 shares of BP at 6/18/10 close vs. 1 oz. of gold but for most people
that would be too controversial http://stockcharts.com/h-sc/ui?s=$GOLD:BP&p=D&b=5&g=0&id=p39755523681
How about the tech index XLK which would be the best of the three and better than the headline which was meant to get attention. In this case one would own 56.27 shares as opposed to 1 oz. of gold:
http://stockcharts.com/h-sc/ui?s=$GOLD:XLK&p=D&b=5&g=0&id=p47301381696
3 Strikes you're out OR 3rd time is the charm?
SP 500 has been battling to break and wave goodbye to the 1100 level since Oct 19, 2009 (nine months). The action of the last four days (including today) suggests this is the third serious attempt to put it in the rear-view mirror. So, what will it be: "Three strikes and you're out", or "Third time is the charm"?
see attachment
Greece
Bill,
Thanks for the link to the interview. It is at least refreshing to hear the Prime Minister admit the problem and the causes — I wish him well.
We should be so lucky. Instead each day denial continues.
As you have pointed out individual investors seem to have lost almost all faith in the US markets. I know I have. The same is true of rating agencies — and our congressional oversight committees. Barney Google would do a better job, quite "Frankly".
Ennis Business Forms - Thanks Vad
EBF reported earnings at 10:17 .50 per share vs. consensus of .31
Just like Vad showed us in the seminar in January, stock goes straight
up - early birds bought - early birds sell on the up move and then
the stock falls back to where it was.
Thanks again Vad for your seminar and the understanding!!
Anticipation
When trying to complete a pass to the wide receiver, a quarterback will throw the ball to where he anticipates the receiver will be. Short passes have a high percentage of completion. Risk of incompletion grows, as does the possiblity of an interception, as distance increases. Anticipation by the defense also decreases the success of a complete forward pass.
Even completed passes are not a sure thing. Referees can nullify a completed pass and impose penalties on top of that. Both players and officials can be comprimised by bribes & bets. Games can be rigged, tilting the outcome toward the 'savvy' (cheating) team, and the savvy team can be either long or short.
I'm trying to figure out what works. It's hard enough to battle other players, but when the PPT & GS stack the deck, well, you know. I think most other individual investors think similar thoughts, so I anticipate they'll stay out at least through summer. Parking funds in cash is pretty much useless except to get a return OF capital. About the only protection from incompetence & manipulation and still anticipate a return, is to move to precious metals (bullion, GLD, SGOL, SLV, SIVR) for a while. I think Q2 results for most will be consistent with prior year. Q3 is another story. Antipating pitiful consumer participation, primarily due to credit contraction, will be seen by August. Insiders will see July-August results and will begin to sell during September. As for credit contraction, when I see 20+% usuary interest charged to customers with good credit, I know very few will carry balances - if unable to pay off at month-end, will just not buy unless it's an emergency.
For the most part, I've focused on historical trends & results. I want to change.
I anticipate going short in September.
Re: Anticipation
The consumer is continuing to delever. Ms. Whitney talks of 2nd housing crisis on CNBC this morning. I've heard that some people say Gold is a hedge in a deflationary environment. Might have to try some of that "wacky weed".
Attached is a Fred Graph from the St. Louis Fed. See how far the obligations have been reduced by Households. There is more that they will do. They were at 16% in a secular Bull market in 1995. Unemployment worse - everything worse than then.
I actually believe that the numbers and graphs provided by our Fed. Reserve are accurate and can't be compromised by any administration.
Moves by market participants leave tracks. It's up to the trader/investor to "read the tape" and see what is happening with volume and most importantly Prices. Paranoia running rampant.
Chinese revaluation
Bill, several bloggers already caught on to what you've described in the Medium is the message" post. If the Euro keeps sliding lower, then the value of RMB vs USD will also be lower, just not as fast as the Euro itself.
In other words, Chinese "stuff" will cost even less in Europe. And USD-denominated debt will be worth fewer RMB. Both are not positive for the USA. So, why is the market up?
Take a swim more often, Bill
the batteries are recharging and Bill is kicking some A** !
Re: Anticipation
George,
Re: "I actually believe that the numbers and graphs provided by our Fed. Reserve are accurate and can't be compromised by any administration."
I prefer the data produced by ShadowStats.com and Consumer Metrics Institute.
Re: "Moves by market participants leave tracks."
I concur. This morning I forwarded a link of the London Stock Exchange time-stamped trading in Silver to Geoff and Patrick. Price and volume was plunging before I sat in for a couple minutes to hear Bloomberg announce that Gold was going to 1600 and Dennis Gartman say that "the chart starts in the bottom left and ends in the upper right. End of story." This was all just pure promotion. The facts are that the GDXJ right now is below Friday's gap higher open and within a few cents of Thursday's gap higher open. Prices go both ways, but it seems that Bloomberg has an easier time finding the Goldman's and Gartman's AFTER the bull move.
For that reason I almost never watch CNBC anymore and spend maybe 5 or 10 minutes max on Bloomberg. Like you, I spend 98% of my time watching the price and volume action, and looking for the drivers.
Re: Chinese revaluation
Takes an issue off the table Prior to G 20. Number 1 and 3 top world trading economies less likely to have a trade war. World equities are all intermingled and the more peace between them the less uncertainty.
Gap up this morning was the time to gather some cash as there is too much resistance at 1137. Will be best to close the $spx gap by trading lower than Friday's high of 1121.01. Sideways consolidation would be positive.
This gap is like the Euro 1T announcement. Big burst then reality sets in.
Re: Anticipation
Every morning I look at a perf chart of GLD,GDX,DGZ,GDXJ
GDXJ swings much faster than GDX and when it moves up
rapidly, shorting by buying DGZ has good odds. I
prefer DZZ as it is the double.
My first post is what I'm betting on. A sell-off in Gold
worth trading at least for the short term.
I drink coffee and look at CNBC but agree totally with you
concerning same.
I am unfamiliar with Shadow Stats but will study it as I have
studied so many things that you have offered on the site and
in Freeport.
Reform you say?
(US) Rep Frank (D-MA): Looking to modify Senate debit cap plan; House is looking to retain Senate's proposals for capping interchange fees
- House Democrats have agreed with Senate proposal to place financial product regulatory authority inside the Federal Reserve; are looking to place Pay Day and private Student Lenders within scope of consumer watchdog
- Dems seek to expand watchdog's regulatory powers to include banks with assets below $10B (note: US Senator dodd highlighted in November that the FinReg would provide power to the consumer protection agency to assess fees on banks with $10B or more in assets).
- House Democratic members looking to give exemptions to auto dealer and pawn brokers from consumer protection agency regulation; Want to add payday lenders and private student lenders to the watchdog agency's purview.
Re: Cara 100 Ratings Changes
Conversely, Barron's Weekly publishes a relatively positive article re XOM: "Healthy, Cheap Exxon Gobbles Up XTO, Stands Ready to Rise Again " ( p. 14 ). Just an observation.
Australian mining executives feared dead in Congo plane crash
Australian mining magnate Ken Talbot and five other Australian mining executives are among 11 people reported to have died after their aircraft went missing over West Africa
Executives from three Australian mining companies – Gindalbie, Sundance Resources and Western Areas – including MR Talbot, a Sundance director and one of Australia’s richest men, went missing on a flight from Cameroon to the Congo Republic.
The plane, a CASA C-212 twin turboprop, was en route from the Cameroon capital of Yaounde to Yangadou in the Republic of Congo on Saturday when contact was lost.
http://bit.ly/aO64na
New Bullion Vault investors
Serious money now backing Bullion Vault should add to their credibility for those looking to hold gold offshore:
http://www.telegraph.co.uk/finance/newsbysector/ba...
I suspect they're a little more convenient than the Perth Mint, but haven't compared their costs.
$SPX
I'm betting it's a nice test of new support level at 200ma.
Mr Market says: the consumer is sick
XRT and XHB leading the charge down today. While SPX is just off 0.4%, XHB -1.8% and XRT down a big 2.6%. Perhaps Mr Market is reading consumer metrics and not paying much attention to the Yuan?
Re: Reform you say?
Vad,
Look on the bright side. With Bubbling, Bungling Barney Frank as a regulatory watch dog at least we will KNOW what to expect — another Fanny/Freddie episode for sure — but expanded into other territory.
Re: $SPX
Easy money in DZZ made. Covered it.
The Medium is the Message - incredible timing of the post!
what if the news are tailor-made to fit the patterns used by the algos?
what if press release simply do not tell "whole truth"?
http://blogs.wsj.com/digits/2010/06/21/using-artif...
Breadth
Breadth from Friday's close at first glance doesn't look too bad just as the -4pts on SPX, not so from today's opening...
The difference from just a simple up/down screen... breadth goes from 2:1 negative (prior close) to 5:1 negative (today's open) depending on unchanged definition and other filters/criteria.
NFLX a good short?
PE is now above 50. Stock looks a bit parabolic as does the P/E ratio.
http://bigcharts.marketwatch.com/quickchart/quickc...
Lots of competition coming down the pipe as the movie studios want to bypass NFLX and Block Buster by sending movies directly to your home.
Look at HBO. You can now stream all of their content to your computer if you are a cable subsriber. Starz is doing this also. Expect Disney and others to follow.
www.HBOgo.com
First Gulf storm to watch
http://www.nhc.noaa.gov/gtwo_atl.shtml
A LARGE AREA OF SHOWERS AND THUNDERSTORMS OVER THE EASTERN CARIBBEAN
SEA IS ASSOCIATED WITH A STRONG TROPICAL WAVE THAT IS MOVING
WESTWARD AT 10 TO 15 MPH. ALTHOUGH THERE IS NO EVIDENCE OF A
SURFACE CIRCULATION...THIS SYSTEM IS SHOWING SOME SIGNS OF
ORGANIZATION AND ENVIRONMENTAL CONDITIONS APPEAR CONDUCIVE FOR
GRADUAL DEVELOPMENT DURING THE NEXT COUPLE OF DAYS. THIS WAVE
COULD PRODUCE LOCALLY HEAVY RAINFALL AND GUSTY WINDS OVER PORTIONS
OF NORTHERN VENEZUELA...THE NETHERLANDS ANTILLES...PUERTO
RICO...THE DOMINICAN REPUBLIC...AND HAITI OVER THE NEXT DAY OR SO.
THERE IS A MEDIUM CHANCE...30 PERCENT...OF THIS SYSTEM BECOMING A
TROPICAL CYCLONE DURING THE NEXT 48 HOURS.
Re: First Gulf storm to watch
My prayers for avoidance of the oil. But it's inevitable and only a matter of time.
Baltic Dry Index
continues to plunge lower:
http://www.bloomberg.com/apps/quote?ticker=bdiy%3Aind
Down another 3.5% today.
" Privacy? - It's gone; get used to it" -- Scott McNealy of SUN
I came across a rather amazing little paper on Amazon which showed how true McNealy's lament! It costs 99 cents electronically, and is called:
A Trip to the Store for Bread and Milk: Cellphone Spying, Tracking and Privacy (The True State of Privacy in 2010) (Kindle Edition)
I had SOME idea of the level of surveillance over citizens, but learned interesting detail:
- every PC bought by an institution with "intel inside" contains an activated 2nd processor (vPro) and a program called AMT through which the IT dept. can take control of your work-issued laptop. You will have signed an agreement entitling the institution to do anything they wish with "their computer". AMT can turn on the mic, or the webcam, and can retrieve files from your PC.
This can be done any time, anywhere you're connected to the net (including in your bedroom, as happened in that recent case involving a school system in Pennsylvania spying on student laptops).
SO, it's best to have a school or employer who "first, does no evil"!
- which reminds me of google searches: if you have gmail, and allow it to "keep you signed in" then your name along with your IP address is stored in Google's computers for every search.
- every cellphone has a control channel, which can be accessed by your gov't and your carrier; commands passed down this channel can activate the mic, and camera(s) and retrieve data from your phone. A special program is downloaded into cellphones of persons under official surveillance which can do these things when the phone is TURNED OFF.
It seems these capabilities can only be thwarted unplugging PCs and phones, and removing their batteries!(Don't worry about my disclosure; the bad guys all know this already!)
In this brief paper are other instances of (mostly commercial) surveillance which we don't stop to think about (Onstar's capabilities are detailed).
Everybody should read this, and wonder why Obama flip-flopped to support the amendments to the "Patriot Act" which exempted the phone companies from liability when cooperating with the government on digital surveillance.
People usually react by saying "I have nothing to hide" or "they to catch the bad guys!" This paper shows that the issue goes way beyond that. We have to imagine a future young Martin Luther King being surveilled by a future J. Edgar Hoover.
Such a future young Martin would NEVER rise to a position of prominence or influence!
Not to mention the implications for countries which have not created a western, democratic form of government, yet have deployed millions of cellphones and PC's.
If you're interested, here's the URL to buy and download it:
http://www.amazon.com/Trip-Store-Bread-Milk-ebook/...
the author seems to have been at Apple, and associated with "the Foresight Institute".
Re: Baltic Dry Index
BDI has had a fourteen month plunge. I follow this Index to discern if the global economy is truly recovering. BDI is not confirming what the economists are saying.
Jean-Marie Eveillard
There is an interview on King World News of Jean-Marie. It's short (15 min) but well worth your time if you are a value investor. He has views on gold, Austrian economics, and the difficulity of staying out of markets when they make no sense.
I was unaware of Jean-Marie til the late 90's when the markets went insane and I felt like a fool rolling T-Bills. Always looking for company when you are miserable, I found that he shared a similar dilemma. His thought process is similar to mine and he must be a genius because he has a hyphenated name ;-).
A voice of reason in the wilderness, I recommend him to you.
P.S.
Anyone with the talent to link this sucker wins a homemade cookie.
Heroes Among Us
http://ronsen.blogspot.com/2010/06/heroes-among-us...
Those of the greatest generation simply deserve better from the plunderers of plenty.
Re: Jean-Marie Eveillard
http://kingworldnews.com/kingworldnews/Broadcast/E...
Ross, that will be one steer please. LOL
Enjoy
Re: Baltic Dry Index
"fourteen month plunge"?
Huh? What are you talking about, Gary? BDI is up 37.5% over the last 14 months and 314% over the last 19 months. Anyway, BDI means what...?
More noise to be filtered out...
BEFORE KEYNES
ALOHA!!
Before Keynes ...
The Economic Consequences of the Peace
by John Maynard Keynes
1919
The best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth.
Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become 'profiteers,' who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat.
As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.
There was Richter ...
Eugen Richter (1838–1906).[1] During the last decades of the 19th century, he was the leading libertarian in the German Reichstag, as well as the chief editor of the Freisinnige Zeitung. Seventy years before the Berlin Wall, Richter's dystopian novel, Pictures of the Socialistic Future(1891), boldly predicted that victorious German socialism would inspire a mass exodus — and that the socialists would respond by banning emigration, and punishing violators with deadly force.
The mass exodus:
Useful people, and people who had really learnt something, went away in ever-increasing numbers to Switzerland, to England, to America, in which countries Socialism has not succeeded in getting itself established. Architects, engineers, chemists, doctors, teachers, managers of works and mills, and all kinds of skilled workmen, emigrated in shoals. The main cause of this would appear to be a certain exaltation of mind which is greatly to be regretted. These people imagine themselves to be something better, and they cannot bear the thought of getting only the same guerdon as the simple honest day laborer.
The emigration ban:
A decree has been issued against all emigration without the permission of the authorities.… Old persons who are beyond work, and infants, are at liberty to go away, but the right to emigrate cannot be conceded to robust people who are under obligations to the State for their education and culture, so long as they are of working age.
The deadly force:
Under these circumstances the Government is to be commended for stringently carrying out its measures to prevent emigration. In order to do so all the more effectually, it has been deemed expedient to send strong bodies of troops to the frontiers, and to the seaport towns. The frontiers towards Switzerland have received especial attention from the authorities. It is announced that the standing army will be increased by many battalions of infantry and squadrons of cavalry. The frontier patrols have strict instructions to unceremoniously shoot down all fugitives.
LINK: http://mises.org/resources/4994/Pictures-of-the-So...
Now we have OBAMA ... Change we can believe in!
Stockholm Syndrome ...
These Facts are Held Self-Evident
1) Easy Money was the chosen solution to keep the good times rolling, even though the good times were questionable.
2) Productivity was already being impacted by poor allocation of resources, wars not going well.
3) Financial oligarchs effectively took over the government, existing laws were not enforced, and as thing came to a head in 2006 and 2007 the big brokers (deal makers, IPO, LBO's) were hiring specialists in bankruptcy reorganization. They were poised to buy stuff up on the cheap when things blew up.
4) The recent "recovery" is really just the same recession, but given a hit of crack so it can party on a little longer. Many trillions were spent, but it mostly benefiting big business, big banks/brokers. Long term benefits to the economy are non-existent.
5) Government workers have increased their pay like 30% to 40% whilst non-gov workers have treaded water, even if they have a job at all.
6) Government is expanding it's powers and owning businesses. Whilst theoretically, expanded powers could be useful, why we anyone assume so, given that existing laws and oversight were already so poorly performed.
7) Lobbying, campaign contributions, and restrictions on how any Gov official could migrate from an oversight of an industry to an executive or lobbying position must be instituted.
8) Deflation is likely to be the near term hobgoblin.
9) The Gov can literally just print money, seriously. They can hand out that paper money to pay off debts. They do not have to roll over every debt. All the governments with soveriegn currencies can do this. The Euro cannot. This is called competitive devaluation.
10) Inflation can take hold someday. You best not have all your assets in paper money or equivalents. These changes may happen relatively quickly, like by 2012.
11) The US has plenty of military muscle, expect it to be used more, especially as things go bad.
12) If anyone owes you money, get it now.
13) Very few, maybe 1% of the population learned anything from the greatest financial crisis in a century. Or they "learned" that the Gov can indeed save us by strong Gov intervention in free markets. This makes the next crisis more dangerous.
14) Very few of the problems of the crisis were solved by those trillions of dollars thrown at the situation. It was more just a transfer of wealth from a captive audience to the ogliarchs. The bad debts, bad assets are still on the books, they have just been covered up. Those in the know, know it, and they are pulling out all the stops to "get theirs" before round 2.
14) There may be a QE2 (Quantitative Easing, money printing, throwing money at large banks/brokers), or the USA could follow the austerity trend that is all the rage (pun intended).
15) Reviewed Conquer the Crash by Big Daddy Pretcher. We all love Pretcher, he is a free thinker, like Armstrong, but he has been so wrong for so long, he is not infalliable. His view on Gold is wrong, it is not just a commodity that reacts like others.
16) Gold is a currency. Paper gold is a speculation device, owning gold ETFs and even gold miners is not the same as owning physical gold. Silver is good for making change, buying a tank of gas, bag of rice, etc.
17) We are not at the precipice of Primary 3 wave down, we could be near the end of the 1st 5 waves down (completion of wave 1). Wave 2 could slog sideways for years, like a zombie propped up by QE2.
18) Most people have lived beyond their means for a long time. Most "young people" say 35 and younger, have only lived in a bull market.
19) In order for any chance of moving forward with positive results a few things must happen--banks and investment advisers/brokers/deal makers must be separated by a firewall, not a just a company division name, lobbying must be curtailed, contract law including making bondholders take their lumps, must be restored.
20) Never has the world been so intertwined. Never has the situation for competitive devaluation of every countries currency been so nicely setup.
21) There is still something like $600T of notional value of derivatives floating around out there, and apparently no one even know where they are or how to track them. This is many multiples of the world GDP. This can't be good for the common man.
Re: Baltic Dry Index
Mack, BDIY:IND is what I follow. On 11/19/2009 it was 4643.00. On 06/18/2010 under 3000 and as per another poster earlier dropped 3.5% today. Baltic Dry Index.
I think we met years ago on the WSW window site, I just read the menu for journalists at the G20 meeting in Toronto, they are not having road kill for dinner. Reduce Canada Pension,early retirement benefits, and then our finance minister can stand up in front of the G20 and say we have our fiscal house in order, what is another two billion for a meeting, and the Chinese scooped em before it started, they stole the thunder from the G8, and Teflon Timmy, and Teflon Harper, say a step in the right direction.
I hope the Ontario Quail, and Manitoba Catfish, are well served, I doubt POUTINE
will be on the menu as you can get it at Harveys for 4.85 outside the security zone.
FD Long physical gold, silver, divy paying energy trusts.
Re: Heroes Among Us
great piece on the vet, and this pices enjoyed the vid. Our parents are checking out. We're left in charge. Better do something for our kids.
Re: Heroes Among Us
The contrast couldn't be greater than with the Aussie mining tycoon dying in an airplane crash while checking out his company mines. Personal net worth - nearly $1B. Helps to focus priorities when you have to leave it all behind.
http://www.theaustralian.com.au/business/mining-en...
Yesterday the markets functioned so well as I know them that I had racked up almost 1k in paper profits in afternoon trading. Unfortunately I had painted myself into an ugly corner in the morning with losses almost double that. News of APC being sued by BP had me shorting APC into the opening swan dive for +.70 gain. Only problem was I didn't cover. "it'll come back down" - yeh right. Some ugly revenge trading followed...
No place for rational man (or as telestar links below, the irrational) in trading, as I continue to learn.
Invisible Gorilla
http://www.marketwatch.com/story/an-invisible-gori...
Yuan
The spike in the overnight futures based on the vague assurances from China to revalue the yuan higher, an obvious and strictly political move to pre-empt the discussion of their currency manipulation at the upcoming G20 meeting, was used to justify a classic 'wash and rinse' in the price fo stocks, and bring in some coin for the needy Wall Street banks.
This is how the moral hazard of bailing out the Too Big Banks has returned as an unintended consequence, strangling the real economy and the very markets which the bailouts were intended to save by taxing production and capital with the drag of a corruption tax that also had a dampening effect on efficient capital allocation.
The Banks, being fundamentally unreformed and insolvent, with failed business models based on fraud, are unable to make their expected outsized returns using conventional business means. With the mortgage and CDO ponzi scheme collapsed, they must resort to the more familiar soft control frauds in the capital allocation markets, creating and exploiting inefficiencies to support their unsustainable existance. Better that they would have been broken up and liquidated where necessary, rather than being saved without a structural reform.
No matter the rationales put forward, it was an act of political corruption in which the Congress and the last two Administrations are complicit. More and more wealth is being transferred out of the productive economy and into the hands of a financial elite that spends it in the non-productive accumulation of capital, high risk speculation, and hoarding incented by historically low tax rates for the very wealthy.
As I suggested last night, the spike higher in the futures was artificial, and worth fading to the short side. But while it stays above the trendline now around 1110 I would not lean on it too hard, since the threat of a snapback rally in the last hour is always there on these thin volumes. If it breaks down, we are probably heading down to the 1060 support in a roundabout way. The economy is floundering, with about half of US GDP dependent on fraud in financial assets and corporate accounting.
There is also an FOMC rate decision coming up on the 23rd, Wednesday, so we will see some artificial action around that. It is also the day that GTU closes its shelf offering which should take some of the pressure off the unit price.
by http://jessescrossroadscafe.blogspot.com/
Re: Jean-Marie Eveillard
Jean-Marie Eveillard http://bit.ly/cdbJi8
Re: Invisible Gorilla
moved to new blog entry