Cara's Commentary & Community Chat, Thursday, Jul 2, 2009

http://www.youtube.com/watch?v=OmWLAt_KSYE

Pat Metheny and Lyle Mays in '78. Love the piano solo by Mays.

I'm not as sanguine about predicting implosion for Mrs. Palin. If I were a betting man, I'd bet she will be much more carefully groomed this second time around. She will not make rookie mistakes about geography and foreign policy, she will have read a newspaper or two, she will be much more up on events outside the boundaries of her state, and - quite frankly, with enough money spent and enough time with speech tutors, I suspect she will surprise people.

She needs her time off to go to a politician's equivalent of charm school. It will be interesting to see what she looks like once she's done. "The rain, in spain, stays mainly in the plain!" Give her a year.

Now of course I can't possibly vote for a Republican because they're so tied to the evangelicals who terrify me because of their (varying degrees of) intolerance. If there were only someone fiscally conservative and at the same time, a believer in personal freedom, I'd vote for them in a second.

Craig...What absolute rubbish.

I suggest you read your history closer...it is the moderates that have lost republican POTUS elections over and over again. The liberals are only 21% of the voting public, conservatives 44%, 35% independents.

McCain and his stance on immigration and "getting along" with the liberals cost him the support and vote of conservatives.

Recall the initial support for Fred...it was not him being a moderate. And even Ron Paul...he was more right than worng.

Long before Sarah went on TV the liberals attacked her, sent reporters to Alaska to dig up dirt...and even if lies, kept spreading them. If liberals are not afraid of Sarah, why do they and their web sites continue their non-stop attack on her?

Maybe you are not old enough to recall the moderates attack Reagan...or his knickname - Raygun...or his being laffed at for being an actor and too old.

Before you call Sarah rubbish...look what the American public voted for...Mr "Present" who is a muslim (speaks fluent arabic and malaysian) and was a gangster in Chicago. And Biden as VP...Dan Quayle reborn. I had rather support and vote for someone that believes in America, its heritage, and its culture than an Alinsky protege.

It is the moderates that have destroyed the republican party...not the conservatives IMHO.

MK

My goodness mrking, you don't need to look too far to see what has hurt the republican party so badly. It's not Republican moderates. It's 8 years of republican rule, fighting a pair of simultaneous wars, the exploding of the real estate bubble, with the denouement being the crash of 08. Call it bad luck, or just desserts, or the logical end product of the complete lack of regulation started under Clinton but taken to a fine art form under Bush.

Of course if its any comfort, I think the Democrats are on track to blow themselves up as well - and it will probably take less time given where I see things going. I suspect after 4 years of Democrat rule, the public will be ready to toss them out as well.

Then what? I don't think the answer will be "Thank God for Palin, She will Save Us!"

After massive Obama deficits and the likely end game there, I'm going to predict a major break from the past. Perhaps a new party. Hopefully not National Socialism, that would be unfortunate.

It appears to me that all are tainted in politics in the USA and debating Palin or others for office of President is simply chasing mediocrity. They are not in control as is clear from the debate in this crisis.

Yet Ron Paul is a moderate Republican and perhaps the best chance that the Republic party has for standing for something again, which would hopefully include rooting out the money that taints Washington.

For this reason, he will not be nominated, both parties will continue to bring the USA to ruin and guys like him might garner greater interest from the public as an independent doing what Obama did - appealing for funding directly from the public thanks to peer to peer technology to ensure adequate coverage on the all important mass electronic media. Inadequate funding has always been the Achilles heel of the independents. This need not necessarily be the case any more after Obama's demonstration.

Here is an interesting article from the globe and mail from Avner Mandelman.
I post it here because Mandelman recommended BA as a war stock at the same time that Bill stated he
like BA going forward and that was 33% lower than todays price...not a bad return.
Tried to link but unsuccessful so I pasted.
Watch out if a cash-poor U.S. seeks new spoils

AVNER MANDELMAN

Saturday, July 4 2009

amandelman@giraffecapital.com

One of the monthly letters I read devotedly is Eric Sprott's. It is irreverent, pithy, brutally honest – and very often right.

The latest piece (written with David Franklin) is no exception. Titled 'The Solution … is the Problem,' it makes cle ar (via detailed tables) that there isn't enough free and willing cash anywhere to roll over U.S. government debt.

Therefore, 'the future solvency of the U.S. as a nation-state is currently in jeopardy.' In other words, the U.S. government is broke. Messrs. Sprott and Franklin then invite the reader 'to explain to us how this debt crisis will resolve itself without significant turmoil.'

Why am I quoting the letter? Because although I agree with its excellent analysis, I think its definition of 'turmoil,' being (probably) financial and political, is a bit narrow. I'm convinced that, at this point, one must conclude that war is the likeliest way out. Why is this quibble important?

Because Mr. Sprott's analysis might push one to both buy gold and short bonds, whereas my quibble would support the first conclusion, but be wary of the second.

Here's why: History shows th at empires that desperately need money but cannot get it willingly will take it by force from the powerless, then invent reasons why this taking was necessary. Think indebted Mafia dons: Does their credit rating really matter?

The more apt historical analogy is the British Empire after the Napoleonic wars. Once these ended (Waterloo took place in 1815), the British government, like the United States today, was horrendously in debt and practically bankrupt, as all its revenue sources had been used up to vanquish Bonaparte.

But there was one wealth source hitherto untapped: India. India was rich, India was large, India was defenceless. However, India was the 'property' of the East India Company (EIC), a concession of the Crown.

So following the Napoleonic wars, little by little the indebted British government seized control of the EIC to grab India's wealth directly. Even as early as 1813, two years before Waterloo, Britain renewed the EIC's charter but terminated its monopoly – perhaps to prepare for future control – and after Waterloo, Britain charged the East India Company an enormous tax to pay for 'military services.'

And yet even the taxed EIC was still considered 'safer' than the British Crown, as evidenced by the yield on its 'funds' (bonds). Only by 1823 did the yield on EIC 'funds' cross over that of British government ones – in parallel with the takeover of the EIC (and India) by the British government – which also made the pound strengthen. And thus bankrupt Britain fixed its finances by grabbing India's wealth.

Why is it relevant? Because, at the time, the money was in India. Where is it today?

Mostly in sovereign funds, pension funds and other public fiduciaries, as per Mr. Sprott and Mr. Franklin's fine tables. But none of this wealth can – or wishes – to pay for U.S. government debt. So a civilized analyst would conclude: In a world of purely voluntary wealth transfers, one should short U.S. bonds because the U.S. must issue more, and no sane investor would buy them. And one should also buy gold, since it's an asset the U.S. government cannot inflate away.

Gold aside, the above argument assumes that all major wealth transfers are voluntary. But what if the assumption is wrong? In Palermo it is dead wrong, just as it was in the EIC's India.

What if today's world goes (partly) the same way? For example, one of the largest global wealth transfers is the $700-billion (U.S.) annual payment for oil, made by the U.S. to often-primitive and dangerous dictatorships. Will this continue?

Now mind – this is not a matter of 'should,' only of 'probable.' I am not suggesting the U.S. would grab the oil in war, nor – as Britain did in India – give pri ze money to generals who vanquished maharajas and grabbed their wealth for the Crown. But I am suggesting that in the case of countries who use their oil wealth to make life hard for the bankrupt U.S., arguments would be invented to take their wealth to help make the U.S. solvent, or at least make more oil flow so as to cut its price: The resulting financial relief would be so large (let alone the decline in risk premium worldwide) that it would pay for many speechwriters composing justifications. Empires go where the payoff is, and invent reasons later. Like Britain of old and its EIC grab.

So: I agree with Messrs. Sprott and Franklin that the United States is in a hopeless spot. But I half disagree with the (implied) conclusion that U.S. bonds are a short. I think the U.S., like Britain of old, will adhere to the old Wild West rule – when your opponent holds all the cards, overturn the table.

2nd—ave,

I first sent my idea for a national passenger rail system to George H. W. Bush when campaigning for Prez. (to each candidate since). It could mostly run on the median of our existing Interstate Highway System. I never had a reply from anyone — including Obama and McCain.

Edit: See attached

"So: I agree with Messrs. Sprott and Franklin that the United States is in a hopeless spot. But I half disagree with the (implied) conclusion that U.S. bonds are a short. I think the U.S., like Britain of old, will adhere to the old Wild West rule – when your opponent holds all the cards, overturn the table."

This is what quantitative easing is supposed to be all about. Note that the Swedish repo rate is negative .25% since the Latvian bond market default. I believe the U.S. is set for negative interest rates, which would theoretically slow the descent of bond prices. Another measure the U.S. can engage in is the construction of singularily vast rail services.

Remember in the 'Long Depression' after the crash of 1873, the U.S. experienced growth in certain sectors such as rail expansion. They could do so because there was plenty of room to grow. Another feature of QE is public health care, which I believe they will implement as a way of preventing from the complete collapse of the health sector due to overwhelming indebtedness to derivatives. The banking sector will have to be nationalized, so that no individual bank can buck the system and interfere with the process.

This is only IF the U.S. manages their situation with aplomb throughout the course of QE, without any private special interest group interfering. Another thing which can throw a wrench in the works is a black swan event, such as a geopolitical scale intervention between two global powers. (We're very nearly there on the very brink with the war on terror.)

Les, yes the AD plot can swing wildly so it is better to look at a longer term MA. That way the individual trees don't block your view of whats actually going on in the forest.

Here's a chart similar to what Stockcharts showed in the example, I've left it as a chart page link so you can see the settings I used and I also left in the vol indicator as it was in their example even though there is no vol for the AD indicator. You can see that I added an indicator for the 50EMA of the NYSE AD line, then I made the NYSE AD line invisible so all you see is the 50EMA.

Of course the values are a little different as the example chart was from 2004.

http://stockcharts.com/h-sc/ui?s=$NYAD&p=D&yr=0&mn=4&dy=10&id=p78472791146&a=172315435&listNum=50

With respect to your chart on XLE and the use of Stoch, StochRSI & RSI, here's a mod I use often where I overlay two different time frames of FullStoch. I use a different color and opacity just to make it easier to see how they move together.

http://stockcharts.com/h-sc/ui?s=XLE&p=D&b=5&g=0&i...

Another style I've played around with is looking at the percent of stocks above their 50MA. Here's one for the NYSE, $NYA50R, I also look at the same thing for the SP500 and the Nasdaq Composite. Although by itself this data can't be relied upon for trading decisions, it does provide useful information when combined with other data.

http://stockcharts.com/h-sc/ui?s=$NYA&p=W&yr=5&mn=0&dy=0&i=p45146369683&a=99778449&r=5730

Note some of the above index links contained the $ symbol, so to make them work I could have used the Tiny URL method or the " a href .. " method, I used the later, (just in case anyone is wondering how I got them to work).

Sunny here, have a great day, gotta go mow some grass.
Quasi

Well, I'm 54, so I voted in those elections and remember, as a native Californian, Reagan's terms as Governor. He was labelled Rayguns because of his support of the Viet Nam war and his obvious distaste for the people to assemble to protest that war. What a raving success that boondoggle was, eh?
That caused Nixon, a MODERATE, to disconnect the $USD from gold in order to devalue the dollar to pay for that war and also the cause of the ensuing years of stagflation and the crash in the 80's. Yes, I remember quite well. I use a different measure than Kaimu. He uses a menu, which is perfectly acceptable.
I remember my father purchasing a new four wheel drive Chevrolet pick-up for $5000 USD in 1973. Such a truck now would cost at least $35,000 USD.
THAT is the measure of the true cost of foolish leaders and war, most of which have been Republicans since then. If they were so principled, then explain 700% inflation under a majority of Republican Presidents.

As Sun Tzu wrote in "The Art of War", war must be well planned and *short* or it will impoverish the hundred surnames. Some things never change. War is expensive to whoever is funding it. In this case the foolishness of our leaders impoverishes us and we continue to have our currency devalued by such foolishness. Sarah Palin, as she proved in her speech, thinks we should continue military spending on the order of 25 times more than than the total of our closest modern national contemporaries. She is ignorant of The Art of War. I doubt she has the slightest notion where money or the value of money eminates from. I doubt she knows the slightest thing about the Fed. This is not true of Ron Paul who knows well the cost of empire and where the value of money comes from. Ron Paul knows the first sentence of "The Art Of War". "Warfare is the greatest affair of state, the basis of life and death, the Tao for life or extinction." I say again, some things NEVER change.

I'm not trapped in some silly false duality of liberal or conservative. THAT is what distracts us from the reality of our situation. I'm not duped into "he's a Muslim" or he's a this or that, which IS total rubbish meant to divide the people. Divided WE the People fall. Speaking a language is not a shortcoming, it is a strength. It is no indication of anything, otherwise I'm a Spaniard (or pick your Spanish speaking country)for speaking Spanish. That's the most arrogant and ignorant assumption possible. I don't participate in ridiculous accusations for which you cannot provide even one item of proof.
Everyone here can read Snopes, I suggest you go there and get yourself straightened out on your rumors. Clearly not all people that can speak Arabic or Malaysian are Muslims, anymore than I'm Mexican for speaking a little Spanish or French speaking Canadians are French. That is ignorant xenophobia for which the party is well known. Again divisive instead of uniting.
I understand your passion, but rumor mongering doesn't make it so and xenophobia is a canard.

It wasn't the xenophobic fringe topic of immigration that blew up McCain's run. It was the idiotic denial that "the economy was strong" combined with picking a complete unknown to keep up with Hillary Clinton. It was obvious to any unbiased observer. It was a slap in the face to women who saw it as blatant political sexism, which of course it was. He revealed himself as another wealthy out of touch politician, bought by the Wall Street Elites. Then Sarah shot herself in the foot by accepting that ridiculous notion and travelling around the country spouting that line of BS as the country sank into depression/recession, Lehman and Merrill imploding and the ticket continuing to spout delusional nonsense on each of their speaking engagements. In short, they deny reality and are disconnected from the everyday work a day citizen suffering from their ignorance, incompetence, obvious oil and Wall Street corruption and delusion. And the party supported it no matter the cost, because they want power and wealth more than they care about the country. They are selfish, bought off power hungry anti-patriots.

I don't think either aristocratic party is exempt from this fatal flaw. We will see it in action in about four years if conditions don't improve soon. Obama has likely read Sun Tzu, but I doubt he will apply it's wisdom as he is also under the influence of the unspeakable power of the Wall Street, Oil and banking Oligarchy. The last to challenge them was the Kennedy brothers and that result is well known.

I can assure you, the Chinese leadership is well aware of Sun Tzu and the art of war. It appears they know it so well that they may defeat us financially without firing a shot. Our leaders are greedy fools.

No one will be able to break their strangle hold on US until the citizenry unites and stops spouting their well worn divisive line, turning one citizen against the next using false labels and obviously unsolvable Constitutional questions designed to divide us.

David, 2nd—ave,

I wouldn't say Buffett is a trader. He has a "buy and never sell" philosophy. He likes to buy well run, whole companies when possible and is prone to letting them run with little or no interference on his part.

As for people putting their trust in the judgment of anyone there is more than one kind of trustworthiness — honesty and sound judgment. I trust my own judgment when investing mostly, but know I have made some colossal mistakes.

Those people ultimately have no one to blame but themselves since it was their own judgment to trust someone else with their money.

I try not to repeat my mistakes and am quite good at finding new ones :-)

David,

I think of it differently. Instead of never turn a gain into a loss I enter positions with up-side and down side targets. If I don't reach them I do nothing. Not quite always true because a few time I will rethink the position and may act on it but in general I am will to take losses. Maybe you should have a lower limit on ESLR-think how you will feel if it hits the 5+ range. There is always risk in the market. The idea is picking positions with good risk/reward ratio's. My $.02. Good luck.

Oh boy, the argument questioning Obama's presidential eligibility is an astoundingly profound solution in comparison with the incessant bombing of innocent civilians. I applaud the strategic change from outright offensive attack to defensive attack, it demonstrates great flexibility.

I'm riveted to my seat in anticipation of the coming disinfotainment campaign...

bigmother - just an FYI - I enjoy a great many of your posts even though there are few, I find them helpful. Thanks! ;)

"I try not to repeat my mistakes and am quite good at finding new ones"

I'm a great leader in the field of inventing mistakes, let me know if you need assistance. ;)

http://www.freestockcharts.com/

locate video in the new ticker tape.

$20 per month for real time scanning - tempting.

baz22- LOL. The other posts are just ways to kill time while awaiting posts like yours.

AMAG- I scanned through some of the headlines. What exactly does Feraheme offer as a major advantage? It looks like it comes down to whether a dialysis nurse would prefer a 17-second injection of Feraheme to piggy-backing Venofer (iron glucose) or Ferrlecit (iron gluconate) into a dialysis line. Apparently the latter two can be pushed as well, although it would be over 2-5 minutes rather than 17 seconds. Not sure how long an average dialysis session lasts, but it's probably measured in hours. So I'm skeptical as to how they're going to sell the time difference at a price premium.

Ok so that's why they do that. The US Gold Eagle is a $50 coin. Perhaps for the same reason?

Does anyone here know if the Eagle is legal tender?

EDIT: the US mint page says that it is. I wonder what customs thinks about that.

Fransix, Investor groups and individuals have banded together via subscriber sites to 'shop ideas' for quite large but out of the box ventures. I don't advertise for them but they do float some interesting scenarios for mostly commercial projects. Angel investors who have their preferred project profiles. I have submitted a few with mixed response. If the deal has flaws it becomes quickly obvious. Great feedback if nothing else. One site brings investors and investees together like a dating service!

mrking, I would appreciate you refrain from gross slurs on this site.

So after Les posted about the Philharmonics face value being substantially less than the melt value, I did some googling. Apparently, there are some folks out there who proposed a related question to the IRS:

What if I were paid in Gold Eagles instead of FRNs? Would I have to pay taxes based on the melt value, or the face value of said coins?

Apparently, the answer from the IRS was, you would pay taxes on the face value. Then, when you sold the coins, you would have to pay the difference between face value and sale price as a capital gain.

Very interesting, if true. If it started to become widespread, I'm sure they'd fix it, but the concept to me is awesome. It would be a great gold savings plan - kind of an IRA without the limitations.

Ah, if I only had a job, I could agitate for being paid in Gold Eagles, and offer my employer a nice discount on my wages. :)

ALOHA !!

Keynes attended the Treaty Of Versaille, over 90 years ago and wrote a book about his experience there.

Here is what Keynes wrote about Vladimir Lenin, principal leader of the October Revolution and the first head of the Soviet Union, in his book “The Economic Consequences Of The Peace”, which was based on his attendance at the Treaty Of Versailles after WW1 …

“Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, government 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. – 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.

Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.

But while these currencies enjoy a precarious value abroad, they have never entirely lost – their purchasing power at home. A sentiment of trust in the legal money of the State is so deeply implanted in the citizens of all countries that they cannot but believe that some day this money must recover a part at least of its former value. To their minds it appears that value is inherent in money as such, and they do not apprehend that the real wealth, which this money might have stood for, has been dissipated once and for all.

The presumption of a spurious value for the currency, by the force of law expressed in the regulation of prices, contains in itself, however, the seeds of final economic decay, and soon dries up the sources of ultimate supply. – If, however, a government refrains from regulation and allows matters to take their course, essential commodities soon attain a level of price out of the reach of all but the rich, the worthlessness of the money becomes apparent, and the fraud upon the public can be concealed no longer.” END

So you are here on the BILL CARA BLOG and you go to the CTAB CONFERENCE every year and you buy Pascal and Vad's books so you can "beat the system". This is a system that Keynes called "the process of wealth-getting degenerates into a gamble and a lottery". So it is no small coincidence that HB&B makes BIG PROFITS and we don't. It is no small coincidence that each American generation has less and less wealth. It is no small coincidence that we chose the "lesser evils" at the voting booth. It is no small coincidence that we are ALL IN DEBT ... Therefore, it is no small coincidence that the US FED owns our money and that money is "fiat" ...

This part of what Keynes says is what I call EMBEDDED INFLATION and why I use 1939 menus to show what we have lost ... "they do not apprehend that the real wealth, which this money might have stood for, has been dissipated once and for all." Lobster dinners for 85 cents ...

As I read what Keynes said about Lenin I realize that everything he said over 90 years ago has come true ... as if it were a movie script.

My "tin hat" doeth shine brightly amid the gentle Hawaiian Sun!!

IT IS WHAT IT IS ... by design ...

A great summary Kaimu, it makes me want to read the book.

But I have one question. You think this is all by design? Who wins if the whole system ends up failing?

Kaimu, you have your menu, and I have a silver half dollar whose value on the mint date of 1964 was fifty cents, and now it's five dollars. I show this to my friends. A factor of ten, we have lost, since around the time I was born.

Those that win are 'in the room' and privy to the cycles, and they use it to increase their physical holdings of what can't be printed; land, oil, gold, silver, timber, art, antiques, various foreign holdings in the same class of hard assets, etc.

Our forefathers knew this long before Lenin. Thomas Jefferson, who was so opposed to paper currency for the new nation, used this same weapon against the native North American tribes, purposely 'loaning' them goods in exchange for pelts and other 'hard goods' while moving in on and limiting their hunting grounds in order to put them in debt and impoverish them through debt. Hard to admit, Jefferson was way ahead of Lenin in his treachery and use of 'currency' to enslave perceived enemies. And we see him as one of our wonderful 'founding fathers'. He was easily as bad as Lenin turned out to be much later.

Now look at the Chinese....enslaving us with debt. The only caveat is the native Americans had no nuclear weapons, but the Chinese and our other supposed enemies are smart enough to trade worthless paper for military secrets with duped U.S. citizens that think paper is worth something. We have no idea what supposed secrets they have about our 'edge'.

Do you supposed Osama Bin Laden knows this too? I have no such doubt. I'll bet he has read Sun Tzu....

When Kaimu says our leaders are evil, it is an understatement. Our leaders are unadulterated traitors, pure and simple, and we should treat them as such.

http://tinyurl.com/ojsr4o

‘Cannot Be Hostages’

“In the long term, we must also think about a single unit of payment such as the International Monetary Fund’s Special Drawing Rights,” a unit of an account linked to a basket of currencies, he told the Italian newspaper. “We cannot be hostages to the economic situation of a single country, as is happening today with the United States.”

Russia has support. India’s Tendulkar said he is advising Singh to diversify India’s $264.6 billion in foreign-exchange reserves and hold fewer dollars.

Has anyone noticed the dollar gains each time the BRIC expresses concern? Here's my contrarian indicator....:

"Major nations should back dollar as key currency: Japan
Fri Jul 3, 2009 2:18pm EDT

By Yoko Nishikawa

TOKYO (Reuters) - Major countries should support the dollar as the key international currency, although emerging nations may discuss a new global reserve currency on the sidelines of the G8 summit next week, a Japanese official said on Friday.

China has asked for debate on a new global reserve currency when leaders from the Group of Eight (G8) meet with the G5 emerging economies next week in Italy, G8 sources told Reuters. News of the Chinese request pushed the dollar down to a three-week low on Wednesday.

But Japan thinks it would be difficult for another currency to replace the dollar as the world's reserve currency and it is against any move that would unnecessarily weaken the status of the dollar, said Yoichi Suzuki, director-general of the Japanese foreign ministry's economic affairs bureau.

"Japan's stance is that major countries should support the dollar," Suzuki, one of the country's main coordinators for the G8 summit, told Reuters in an interview.

"It won't benefit any country to talk about ideas for a new global key currency, which would weaken the dollar," said Suzuki.

An idea, which China's central bank has floated, that the International Monetary Fund's Special Drawing Right (SDR) could eventually displace the dollar as the principal reserve currency was unrealistic, he added.

Japan is interested in a stable dollar for its trade with other countries and because most of its $1 trillion foreign reserves, the world's second largest, are in dollar assets."

http://www.reuters.com/article/newsOne/idUSTRE5621...

'Why did he not be transparent about his muslim roots when he was running for office'

I'll tell you why not - Because the average American (which pretty much bypasses all on here) has such a deep seated ignorance with regards to anything they don't understand. That includes any religion bar Christianity. It would have stirred up the usual bigots and their cheerleaders and dented his campaign, not on any political basis, just the usual intolerance and ignorance reserved for smear campaigns.

That said, I'm disgusted with the mans performance so far. As an aussie who has a deep interest in the well being of this world, I despair at the road America has taken and continues to take. The apathy of the general populace is almost deserved of the state the country now finds itself in. The world continues to look for leadership and America continues to not only disappoint, but actually disgust.

As for Sarah Palin, if you ever elect such an ignorant, unworldly fool (no matter what her political stance) to govern your country the world will know once and for all that the American Empire is dead and buried.

Ad - Your post closely aligns with my observations, it seems to me our new administration is not stepping up to the plate in the spirit of change offered as a campaign promise. "Disgust" is a term which I fear may become valid.

CP, I did not notice that!

There must be incredible stuff happening behind the scenes. One wonders what "the plan" is for each of these countries' currency reserves. Which prisoner in the dilemma will be first to crack?

I get so lost in all the back and forth. First China says one thing, then the exact opposite. Japan too. Perhaps there are different factions in each country, so they don't speak with a unified voice, any more than we do.

So I go back to technicals. I see the daily MACD for the USD is close to rolling over to the downside. But it hasn't always been a perfect predictor. So I'm on the fence, but leaning down hill.

Fascinating that Japan's Imperial Family visited Canada this week. THAT'S something I have NEVER seen in my lifetime.

http://www.cbc.ca/canada/story/2009/07/03/akihito-...
http://www.cbc.ca/canada/story/2009/04/12/day-chin...

U.S. lawmakers say "buy America", o.k., we court Japan and China... :)

mrking - "As for Sarah Palin, if you ever elect such an ignorant, unworldly fool (no matter what her political stance) to govern your country the world will know once and for all that the American Empire is dead and buried."

I might just have to agree with that sentiment.

"Bill Carrigan, writing his byline column in the Toronto Star this weekend, talks about secular trends and how they break myths and start dominant themes, which persist for many years. Although, due to space constraints, a bit disjointed, the article is an interesting and thought provoking read.

http://www.thestar.com/business/article/660766

Carrigan, an acquaintance of mine, says he thinks he knows just what the next dominant theme will be – which means he’ll likely write about it next weekend – but he invites your opinion."

Any possibility investors in general are maturing? Away from 'making as much money as possible' to 'making the world a better place?' Which is really another way of saying that investors with the most clout are becoming older.

Investments along those lines that might attract capital:

(a) Technologies that offer the promise of cleaning up the sins of the past. Superfund sites. Urban blight. Abandoned homes/neighborhoods/mills/mines. Rivers, lakes and shorelines that now carry the smell of chemicals and/or sewage, or banks and beaches lined with discarded plastic. Landfills. Who really cares? Well, I for one would invest in any company with employees dedicated to coming up with real solutions.

(b) Smarter healthcare. Companies that are NOT at the cutting edge of science. Rather at the cutting edge of the mundane. Designing public transit systems and public restrooms that invite use and minimize touch contamination of surfaces. Providing toilets and latrines to parts of the world lacking basic sanitation. Finding ways to get substance abusers and mentally ill transients off the streets. Clean streets and sidewalks. Inner city parks that can actually be used as intended.

What kinds of companies might be in play? Architectural design. Construction. Engineering. Janitorial companies. Basic and life sciences. Geology. For-profit versions of Project Hope or the Peace Corps.

After the party ends, someone has to clean up.

I'm stumped as to the next great theme. 2 years ago I was keen on renewable energy (wind especially, solar, and possibly nuclear), but now, as we've all read about, I fear it might be some scuzzy cap-n-trade crap market which will have almost zero benefit for the global economy - long or short run.

What's been burning in my brain recently is the end of a 30 cycle of declining interest rates. We saw that chart from the St. Louis Fed showing the steady rise form zero to 15% 1930-1980 and then the steady decline in rates from 1980-2009, 15%-0%. I just don't have enough experience (education) to understand how such a trend shifts. TOG?

You just might be right, 2nd. It might be a return to solid investment themes by more mature, battered investors. Perhaps, then, wealth management is the next bubble? Blackstone (and China) seem to have made a pretty hefty investment in that direction.

Watched a relevant Frontline video (again) on the issue:

http://www.pbs.org/wgbh/pages/frontline/retirement...

Chilling!

Hi Korvus, just tried putting a couple of people on ignore (temporarily) and it worked fine, no errors, maybe you just fixed it. Running XP-SP3 on FF 3.

Mackinaw
I am little busy right now. Few relative are visiting us from UK/India and S.A
I think the markets right now are pretty much useless as an indicator of anything happening in the real world
Dividend yield on spy is something like 2.31% expected as per Bloomberg. SPY dropped 2.7% on Thurs. someone buying SPY on Wed lost their entire year's dividend in one day. Stock market is a casino, and the house always wins

Could you send me more details on the message? (feel free to use the "Contact the author" functionality if you don't want to post them in the comments) It seems to be working for me, but I'm running a pretty questionable web browser right now...

Hi, 2 nd/.... one setting is if dialysis providers want to maintain profits under Medicare bundling, they will use fewer ESA's and more iron replacement products, like Feraheme , which control anemia but are less expensive. ( from steet.com, and others )... I, personally, DO think AMAG will get bought. (from 'street'... GENZ, sells Renagel & Renvela, which control phosphorus levela in kidney dialysis patients. AMAG would give Genz. another product at a higher operating margin...both in Boston area ).... also, Amgen and J & J would benefit with a buy ....... ***** AMAG will seek approval in Europe, and has licensed its product to SSRX.... #### good info at yahoo finance..

Bill, no need to delete me. I see that any honest and open expression of an opposing opinion here and... whoops - the race and bigot card must be played.

I stand by what I said. Enjoy your hope and change.

MK

Bill's WIR is the third link. His weekly report was highlighted a couple of days ago...might pick up some more contributors :)

I have been subscribing to a Financial Astrolofgy newsletter for several years. The author is Ray Merriman. When I first read it, it was gibberish to me, but over the years I have grown accustomed to the language and have been using it in my investing and, more recently, trading.

Many people who comment on this blog wish that they could know what will happen - say, in the fall. This is another perspective to follow. As someone pointed out, Gann used astrology in his market analysis and predictions.

He, as well as the other financial astrologers, look at the data and interpret it. Like the rest of us, they live in the present, so usually they don't interpret it exactly as it occurs, but there is a lot of truth to the predictions. He also used cycles,and even though it is difficult to time a cycle to the day (or even month), it helps to get a sense of the timing, so you aren't just gambling. It's interesting to me how often Bill Cara says pretty much the same thing as Ray Merriman.

As an example, Ray writes a forecast book every fall. In the book for 2008, which came out at the end of 2007, he states:

"As we now prepare for the first entrance of Pluto in the cardinal (and earth) sign of Capricorn on January 26, 2008, we can observe the world's economies and stock markets are doing extremely well. Many are at new all-time highs as we come to the end of 2007. But it would not be inaccurate to say that storm clouds are gathering as this ingress takes place... Capricorn is a harbinger of a top in many financial makets soon to be completed, to be followed by a breath-taking decline that could last 3-15 years afterwards. Even that will be followed by years of rebuilding before confidence finally returns..."

This is just one example out of many... I know 3-15 years is a big spread and it seems like he is hedging a bit, but, again, this is just one indication out of many. The idea, like TA, is to look at the sum of many and not just one.

http://www.mmacycles.com/weekly-preview/mma-commen...

This is a link to his weekly preview, with a sample printed below. He is not the only well-known financial astrologer. Arch Crawford's newsletter is very well-known and he is usually the one interviewed by the mainstream press.

"On a purely astrological basis, it seems that the period of great hopes (Jupiter conjunct Neptune) may be giving way to hard realities (Saturn in opposition to Uranus and square to Pluto) by the time we reach mid-September, or at the latest, November 2009. That doesn’t mean failure and disappointment are inevitable. But it does mean that the people of this nation, and even the world, will expect to see real signs of economic progress, instead of just words to that effect. They will expect numbers – and not just words – to mean something. Last week’s jobs’ report was anything but optimistic, as they showed approximately 3 million people have lost jobs already this year. Unemployment is now up to 9.5% in the USA, and this trend is certainly consistent with transiting Saturn (loss) in Virgo (work), an astrological condition in effect September 2, 2007 through October 29, 2009. The good news is that we are nearing the end of that transit through Virgo. The not-so-good-news is that Saturn will then move into a waning square hard aspect with Pluto (November 2009 through August 2010). The jobs picture may start to bottom, but the debt problem (Pluto) could get worse."

"This week is important for other reasons too. First, transiting Mars is making a T-square to the Mercury-Pluto square in the New York Stock Exchange chart (May 17, 1792, New York City, time unknown). This is time when stock prices tend to sell off sharply to a low, and indeed they did that on Thursday of last week when the aspect started. Second, there is a lunar eclipse (full moon eclipse) Tuesday, July 7. The market could experience rather intense emotions early this week, for that eclipse is in Cancer and Capricorn, which rule the principles of mother and father, or political authority. There may be a conflict “in the family,” with accusations being hurled about regarding the issue of “parental controls.” Translated into politics and financial markets, there may be allegations regarding the “hidden agenda” (Jupiter and Neptune) of government regulations of banks and financial markets (lunar eclipse in Cancer-Capricorn). If the stock markets can complete this downturn early this week, there is hope into mid-August. If this coming week ends like it did last week, then equity markets may be in store for some panic. The geocosmic picture is still hopeful. The technical picture looks like a train wreck is just starting. "

"January 2010 is looming ahead. That is when President Barack Obama is due to announce his decision on re-appointing Ben Bernanke as the head of the FRB – or to choose someone else. I think that is when we might see who has the real power in this country. With the solar return Mercury in opposition to Pluto, and the Jupiter-Neptune conjunction being squared by Moon in Scorpio, I think we may see a power play like we have not been seen in a long time. Expect a lot of leaks in the press that portray certain leaders in a very negative light. It may be a very dangerous time for the careers, and even the lives, of many who are involved in this behind the scenes effort involving control of the USA monies."

MK- Did you read Bill's post?

Like Bill, I just caught up with today's discourse. Enough is enough...We need to let the current market/economy stand on it's own. My daughter played in a soccer tournament today with about 700 of our future best and brightest. How much are we willing to tie their hands for our benefit?

Dave- Diane Fienstien? Not as fiscally prudent as I would like, but she has stature and respect from both sides. You don't get to the head of the Intelligence committee with weak knees. I also liked the way she responded to the whole Pelosi flap.

Good luck tomorrow everyone. I'll be watching OIL, TBT closely.

I cannot accept anything you just posted about. Sorry.

Craig, I think mrking just watches too much Fox News for his own good. :) Honestly, I don't think he was being racist or xenophobic, but that's just my opinion. Perhaps he deserves the benefit of the doubt?

mrking, you're a smart guy, that's clear to me at least. I'm sure you would do quite well in these discussions without utilizing the more gossip-girl style innuendo that's the popular cheerleading journalism style these days. "Did you know that Helen Douglas was a Communist?"

Honestly, I can't watch the TV news very often. Even when I agree with the bias, the ham-fisted techniques they use to provide their one-sided view of things offends my sensibilities. Really. Even when I agree with them. Its insulting to my intelligence. Its as if they think I can't handle opposing viewpoints. Or that people with opposing viewpoints have to be SHOUTED DOWN. Gah. Sometimes those people have interesting things to say.

I recall in college I read communist writers. While I didn't agree with their worldview, they were smart people, and they had an interesting perspective. It made me think, and that was the point.

It's like TV is now one massive op-ed section run by very rude control freaks. What happened to civil society?

ALOHA !!

Davidfairtex posts - "But I have one question. You think this is all by design? Who wins if the whole system ends up failing?"

When I read the "Grand Plan" by Rothschild, where he states that it does not matter who makes the laws so long as private banks control the money, I raise a red flag. His plan was in action before one shot was fired for our Liberty in 1776. When I read all the text from the various "financial panics" and "bubbles" from 1907 to the present and I constantly see the US FED and its member banks always land on their feet, I raise a red flag. Not only do they "land on their feet" but they gain even more power. Raise a red flag! Now look at the current "financial panic" and look who is landing on their feet and look how they gain even more power over us. It is such a "long train of abuses" that it is impossible to be termed anything but "by design"! Would you call all this just a "coincidence"?

Who wins? Who is winning now? That is who wins ... In the greater Universe, where our collective souls reside, there really are no winners, but there are those who have been intoxicated by power for so long that they actually believe "winning" is possible and not only that ... they really like their "odds" ... They like their odds so much that they do not think twice about a strategy of "double down"! Imagine the audacity of the US FED to petition the US CONgress for "more power"? Imagine that? Now imagine that the US CONgress will give it to them! When have they not failed to own CONgress?

The US TAXPAYER is just the janitor at the Casino and not even a "union janitor" at that ... HA!!

I will detail how FDR made US citizens into criminals and how the MONEY MONOPOLY gained their powers in broad daylight right before CONgress and yet even then none of our "elected representatives" read any of the Bills. As I said in my last article this weekend ... The US CONgress is following in the path of the US Military ... "The US CONgress has adopted the US Military motto of “Don’t ask, Don’t Tell” … Let me add “Don’t Read” also!" ...

This "movie script" has been identical in each and every PANIC that I have read. Even the Father of the great aviator Charles Lindberg argued the very same arguments of RON PAUL now back in 1908.

That same movie script is even at the US FED website for all to read dating back to 1974. I will reprint it ... Why would these monetary elite change anything? Its been working like a charm for over 230 years now ... While WE THE PEOPLE wait for our leaders to CHANGE we make a truly foolish bet. What needs to happen is for WE THE PEOPLE to CHANGE ... waiting for our "elected leaders" to CHANGE is like Waiting For Godot ... That was the fatal error made by those who bought the OBAMA claim of "CHANGE" and the "AUDACITY OF HOPE" ... Audacity indeed ... FISHED IN!

"The most serious dangers for American freedom and the American way of life do not come from without. Full government control of all activities of the individual is virtually the goal of both national parties."

Economic Freedom and Interventionism by Ludwig Von Mises, 1940

And why not? We allow it ...

In order to participate (probabilistically) in tomorrow's opening gap down in commodities, I decided to move up the buy to cover limit order on 1/5 of my FCX short to $44.25 (for the shares I shorted at $50.25). I initially had that limit order at $40.25, but tomorrow's opening gap down might not be big enough to bring FCX down by 20%, while having it hit $44.25 tomorrow is a possibility.

I read that too, but was unable to come away with any view.... other than it could be GS hiding its activities. It may be a very significant event, what are your view?

CP,

A couple of weeks ago I saw an interview with Stephen Roach, the Morgan Stanley Asian top guy,. He was asked about the BRIC conference he'd attended in Russia and the alternative currency possibility.

It was his opinion that, "It is nice they get together to talk things over, but there is little chance of them adopting an alternative currency."

He also said two of these countries are commodity exporters and two are importers trading with each other. Russia's only product is petroleum — when the price is up they are fine, when down they are in deep trouble. China MUST export. It's domestic market cannot support itself yet. He thought India was the best one in which to invest.

Mort Zuckerman who was also there agreed. (US News & World Report, newspaper owner and real estate tycoon) BTW Zuckerman is in US Treasuries.

They both said the US is the economic engine still and the dollar would still dominate as global means of exchange. I guess when no money is real — people might as well stick with the devil they know. Another point of agreement — the US consumer is key to all recovery and with jobs falling it will be a long, slow return for the entire world.

What they did not cover and what I am most concerned about is that historically these kinds of issues usually have been "solved" by a major military conflict.

Good morning.

BHP - Upgraded to Neutral @ Credit Suisse

-------

Other Stocks of Possible Interest:

HMY - Upgraded to Buy @ Deutsche Securities

On the daily charts, NATGAS seems to be basing and potentially setting up within a trading range of 3.25-4.6. Although, I don't see any technical divergences yet.

Conversely, daily UNG seems to be forming a descending triangle. 12.5 to 12.6 area looks to be critical support for UNG. No technical divergences yet.

They're selling long bonds into the gap down.

Government on all levels seeks to garner for itself as much authority as is possible/practical. We have, in the end, as much to fear from the local p and z boards as we do from the globalist international banking conspiracy.

I went to the fireworks Friday night and we were laughing the whole time about the fact that, for the cops, it wasn't a 4th of July celebration so much as it seemed a warm-up for martial law. They really couldn't tell the difference. So you had these 20-year old "deputies" directing traffic in a manner that I can only describe as "fascist-light".

Anybody know what I'm talking about?

Craig, I just put the poor guy on ignore. Why bother talking to a mind that hates?

"As for Sarah Palin, if you ever elect such an ignorant, unworldly fool (no matter what her political stance) to govern your country the world will know once and for all that the American Empire is dead and buried."

Maureen Dowd called her "caribou Barbie"....That's funny.

Grym, Fellow Caraistas,

I am in the position to chair meetings with people of many backgrounds and different strongly held opinions. The meetings are run by Robert's Rules of Order, have a chair, a parliamentarian and a Sergeant at Arms. This is to maintain order, to rule on procedure, and to remove those that fail to control themselves and personally attack others in attendance.

Bill has provided this wonderful forum and all he has ever asked is to maintain some sort of personal decorum and keep it civil.

There is almost no topic that cannot be discussed if people remain respectful and stick to the topic without unneeded personal attacks. We all are intelligent complex beings with varied and nuanced views. We are not liberal or conservative and those labels are nothing more than name calling. The President's upbringing, race, religion etc. aren't the topic. It is his performance or lack of performance that is the topic. The same is true of Sarah Palin.

If we stick to the topic then Snopes, FOX, etc. are unnecessary.

Grym, you are a perfect example. We may not agree on everything but we both have the right to voice our opinions without being attacked. You did so above and you stick to your opinion, yet I note you never once mentioned Obama's religion, race, etc. or anyone else here on a personal level. You haven't labelled anyone as conservative, liberal, or whatever. That is the key to civil discourse. You are to be commended.

I have no desire to see MRKING leave, he has contributed to the blog in a positive manner. However, when he was asked to keep it civil by Loannetter he ignored the request and got off topic on being Muslim, acting Muslim, speaking Arabic, Malaysian, and labeling others here as 'liberal' etc.

This is out of order. All anyone asks is to stay on topic.
The interesting thing is, I happen to agree with a good portion of what he says about the performance of the President. The rest was just a distraction and actually works against his argument.

When I discussed Governor Palin I tried to stay on topic, discuss her ability to communicate and her actions. I didn't need to bring up her religion, her race, her upbringing by her parents, or label those of different opinions as liberal conservative, etc. Those are not the topic.

In this sense I think some of the so-called news organizations do a horrible disservice to our country and they abuse our public airwaves with their incessant personal attacks rather than discussing issues important to our self governance. Theirs is a very bad example and they should not be quoted but rather shunned.

Craig:

I’m sorry, but your response to MRKING was over-the-top. There’s no excuse for name calling, profanity and threats of physical violence. I think you broke all of Bill’s rules. Civil discourse? I don’t think so.

Thank you fox1. I did break the rules and I apologized.
I'm not going to make excuses.