"Let me just say your quaint notions of pharmaceutical bargains and cheap surgeries in Central America in a deflationary world makes me LAUGH OUT LOUD"
good to hear you beat the odds and are a cancer survivor doctor,
my 'quaint notions' of the medical industry are neither quaint nor notions. the vast majority of surgical procedures performed in the US are also done by doctors outside the US, and while the best and most innovative will continue to be americans we shouldnt exclude the rest of the planet from being considered capable of providing safe and effective care for the host of conditions that millions of americans go under the knife for ever year:
hip and knee replacement
heart surgery
arthroscopic surgery
bariatric surgery
plastic surgery
Punta Pacifica Hospital in Panama has been under direct supervision of John Hopkins International and has a thriving medical tourism industry.
your comments contain what i consider a fairly typical american attitude towards other nations, as if to suggest that "central american" states or india and other emerging economies lack the most basic capabilities to perform surgeries that are routine in america.
face facts, hip surgery in a proper central american clinic can cost 1/2 of what it does in the US, and the question of how good is subjective considering there is a vast difference among hospitals within america as well.
not everyone can get or can afford the best of the best for any type of surgery, you dont see a surgeon to get a stich on your cut finger, nor do you need a team of 12 of the best orthopods to conduct routine arthroscopic knee surgery. its a question of making best use of existing resources.
we have enough examples of mistakes at hospitals in america to know that even the best make errors, the question is across the board can other nations be trusted to perform some tasks? we let other nations do most other things that require expertise, why is medicine immune?
though i believe we are looking at 2 very different things.
i cannot recall a time in my rather short life when the common theme was not about helping the economy and about people struggling. this theme repeats itself no matter what the state of the economy is, especially in the US where every election campagin is principally about jobs. why?
because at any given time there were rust belts in mining, manufacturing and other old guard industries that were the fodder for the whole "decline of american empire" that people have been bemoaning about for 80 years.
yes right now things are worse than they were a few years ago, but in spite of the boom times look at the rhetoric coming from most pundits and politicians for the past several decades, its the same:
reduce deficits, balance budgets, focus on economy, create jobs, fund innovation... blah blah blah blah.
certain destruction was always just around the corner, if it wasnt the hun's in WW2 it was the communists, then the japanese, now its the chineese, terrorists and evangelicals....
the idea is that what we expect is much higher than it was several decades ago, (as per my middle class family comparison) thus people see a decline in this higher expectation as an overall decline which in reality is simply a fall from the high point. its like gold "falling" to $1050, which would be met with sadness and described by the bugs as a "collapse", yet 3 years ago the idea of $1050 gold was fantasy.
we have come far over the past 40 or 50 years both in real terms and globally. but the super boom of the early 2000 left us a bit ahead of ourselves. in reality price increases are subject to a host of different factors. those apples being purchased may cost more now simply because its cheaper to sell those apples overseas, or to apple sauce producers, or to use apple tree land for corn. for better or worse, buying apples by the basket is not a logistically sound as it once was. hence they cost more. considering the cost of many grains and softs are above 10 year levels its not surprising, but those prices are below those of about 2 years ago, so something else is causing existing price rises, and i dont believe its any sort of monetary inflation just yet.
ultimately insurance costs more because insurance companies must convince us that costs are rising to justify higher premiums. when times were great costs still went up, even with crime at all time lows police budgets still rise year over year in canada. but a cop's salary is higher now than the 70's, is that inflation or that cops now have advanced degrees they never used to, must learn to use computers and conduct more complex tasks than 40 years ago. lower crime is better and saves money from the imprisonment standpoint but is lower crime a product of better cops? if so the cost is worth it and doesnt reflect any sort of inflation, only skill sets.
back to my medical perspective. there are a host of opinions but i will provide this basic fact:
MRI's were almost nonexistant 40 years ago, people with lumps on their head that didnt meet certian diagnostic criteria would be sent home. if complications developed surgery may have been planned. for all the people who went home and didnt require care, medical costs stopped there, and quite a few may have then went on to die because of swelling that wasnt caught. MRI's come along and mandates change, serious bumps on the head require MRI's, and eventually some not so serious ones if they meet said criteria. now we incur a $300 cost(aprox) in all cases vs. the higher costs in just a few cases.
all in all i feel safer knowing this technology can help prevent complications, but it has a net cost to our system, but its worth it non? is it inflation if healthcare costs rise due in no small part to emerging diagnostic fees which we never incurred just a few decades ago?
heart surgeries are becoming more routine, they cost less and are safer than those of 40 years ago. what will happen when india obtains the same equipment and even better and with their lowered costs can offer the same level of skill and safety for surgery at 1/4 the cost? will insurance companies realize the beneift that flying a person to india for surgery is still cheaper than just paying for american care?
if things get as bad as many doctors will claim, if they are unable to keep up on what they are allowed to charge, eventually the market will shift, and you will see the proliferation of clinics as we are already seeing for medical tourism. drugs too eventually. its cheaper to pick up what you need for the year in costa rica and save a few thousand (if youre on alot of meds) and have a vacation and hip replacement while your down there for a fraction of the cost.
how can this happen? innovation and expertise making medical care that was once only accessible to the skilled and wealthy more available to all.
i can zap a skin tag with a $10 kit from the pharmacy, something that just 10 years ago required a $120 MD visit and procedure. somehow this was deemed safe enough to be trusted to citizens, saving me $110 that i may have to spend on the higher price of my groceries. is that really inflation?
"no inflation in my medical premium, energy bills, tuition, groceries"
inflation in groceries is too vauge, some have gone up while others have gone down. the price of meat (steak, chicken and fish) is notably cheaper year over year at my costco. improvements in supply chains (including china) and flash freezing for fish has allowed more to come to market at cheaper prices than previously, but the cost reductions have nothing to do with inflationary effects as much as logistical.
the same with beef in which meat sold in bulk a la costco is cheaper than at the grocery store. for those who note a price increase they may be looking at specific things but it may or may not be the result of inflation, especially considering many commodities are below their peak of 1-2 years ago. something else is at play.
medical bills and insurance always goes up, no matter inflation, deflation or stagflation.
rising prices in these items are not imho indicative of the type of inflation we are referring to when discussing precious metals, as the rising cost of beef is not really correlated to the POG, there are simply too many factors at play.
natural gas is at a serious down trend while other energy/PM's are steadily rising.
inflation is like crime rates, no matter what the stats say people will always perceive crime to be high and rising. we are at historical lows for crime here in canada, already a safe nation in general, yet media is saturated with images of crime and violence and even clear statistical evidence does nothing to sway people.
thus people behave as if things are more dangerous and feed a self-validating perception each time they do hear of specific crimes. much the same way with cost increases, anyone who remembers the 60's and 70's knows that the average middle class dwelling and lifestyle was materially much less than what we percieve it to be now. a typical family home now is much large, has a garage, though more likely a 2 car garage, instead of vacations to cottage country or florida its all-inclusives to the carribean, and delux cable.
the difference is our standards are different and it is more difficult to keep up with what we beleive to be a standard of living, those steaks may cost more but thats because you believe them to cost more of your limited share of income which may or may not have kept up.
the medical industry much like the insurance industry will never ever ever finally sit back and say that prices are commensurate. they will continue to push much like the manufactures have to rise prices, to demand more for what they do. the issue is not if you are deserving, its a matter of price rises will be the result of lobbied and collective action by a specific group, not the result of inflation.
as MRI's get cheaper, as india increases the pace of their medical facilities, and as the mid-teir of medical jobs that used to require considerable education become more accessbile to more people, wages will not continue to rise as they did, and being a doctor or a nurse will be all the less lucrative just like a carpenter's salary could raise a family 50 years ago a doctor will soon been just a decent middle class earner.
everyone will want to up their wages because of their belief that prices elsewhere are rising. the government of ontario lowered their costs for MRI's by about %25 citing the increased availability of lower cost and more efficient MRI's in the Provence. essentially new machines and ongoing innovation forced the providers into lowering prices simply because they now know the next generation machines can produce better images at lower costs.
that type of payment reduction represents efficiencies and innovations, and is rarely considered during discussions of costs, no only the increases are referred to and most remembered.
medicine is undergoing a change in some respects, many areas are now easily transferable to less educated people who can demand lower wages. something only nurses did 30 years ago is done by a RNA or technician. these represent improvements (just like having to see a doctor for a script for meds that eventually are avaible over the counter, that represents less costs for the system when someone doesnt have to see a doctor to get meds)
eventually surgery, done by robots and minimally invasive methods will improve to the point where less and less people are needed with the kinds of advanced skills that high level surgoens require as more surgery will become routine. (and new innovation will be directed towards other fields or areas, boosting the entire efficiency process).
what im saying is that your steak may cost more, but your home heating (gas) may cost less, and your car may require less on maintenance costs than those of 30 years ago when steak was half the price, and you spend $50 less for meds because you need only drive to the pharmacy, not the doctors for an appointment too. picture this efficiency process occuring in a host of areas of your life.
feeling that this is a weak spike up on low volume,
GDXJ is leading the way, not what I like to see,
most miners are not looking good today on what should be a stronger up day.
my feeling is a possible large downward swoop is looming right now,
but in context of a larger upward trend.
careful gang, i feel better having unloaded 1/3 and can reload later.
while many feel a dump in the broad markets is in the cards, i feel the market will move against most people as it always does, leaving many behind or leaving many broke with unsustainable short positions.
being bearish and down on the economy is becoming too much in fashion, with every tick up in the indicies someone switches to slighly bearish or cautious stances just to avoid being the guy who was bullish before the dump. this kind of protectionism creates an industry that will continue to not earn solid returns for clients as they are long when they shouldnt be and cautious when nothing is happening. imho.
gold is different, it can dump $100 in a day while the broad market sill moves. the anticipation of stimulus or of inflationary forces is what drives gold, while the actual implementation happens long after gold has baked this in the cake. be cautious about over inflationary interpretations, we have been waiting for this official inflation for years and its not unfolding as most said it would (despite their obsfucation that it may have).
two of the larger if not the largest shares of the TSX are energy (nat gas, oil, oil-sands)and Financials. (materials is too broad of a term to be considered a true sector imho)
check out the breakdown on these 2 etf's which give a great snapshot of the movements of the TSX.
not looking good, but the volume is somewhat flimsy.
gold looking good but once again the volume is not impressive at all on the recent run up. if we truly have further weakness in the market we need to see some indication that gold is truly ready to break free of its chains, for now im still wondering if it will simply be as Bill says "last off the dancefloor" while the gold-bugs are chanting that the great disentanglement between gold shares and the market has happened....
back and forth like a fiery salsa gold is twirling around,
moving upto 1233 as we speak, gold stocks moving well especially in spite of a weak market.
for the canadians:
check the XFN and the XEG which track the financials and the gas/oil sector respectively, i note both are breaking down on reasonable volume towards their recent lows and on a 3 year chart you can see the proverbial cliff they appear to be about to fall off of.
it may be too obvious to actually happen, yet i cant help but think things are looking ripe for intervention, more than anything the powers that be dont want to see another stock market plunge, even if it has little material affect to most citizen, the psychology of plunges is what they fear, even after the 2008 dump it was all people could talk about. even employment stats and home prices crashing dont generate the kinds of rhetoric and journalistic fluttering that market crashes do.
today is a great time to test out my theory that when gold jumps up pre-market, it tends to spend the rest of the day moving sideways to down before market close.
if this pattern continues i believe we will see another leg down, as this last leg up was on considerably weak volume across the spectrum of gold vehicles (metal, shares, ETF's)
if we hold this as the USD takes a small swan dive on the daily charts, and not give back the pre-market gains, then my broader theory that we are headed for new highs stays in place.
as i have suspected for some time, gold will rise even if the USD rises, but oil will not. it barely could run up during the gulf oil spill, something that only 1-2 years ago would have made it seem as though $100 was in sight.
what i would like to see is a lower USD coupled with lower oil, and at least 3 quarters of this before i check back with the miners to find out just how well they have done now that their alleged 2 biggest problems (energy costs and high USD costs) have been removed, while their biggest issue (the POG) has been running for some time waiting for them to catch up.
i suspect it will be a make or break moment if gold breaks to Jim Sinclair-esque highs of $1500-$1600 and the shares barely breach their 2008 highs, still complaining forever of problems and an inability to profit.
until then, its all bullion all the time. too many are fearful of a market crash, and while the chance is always there i suspect w/ so much anticipation of a dump and cash in hand, any sort of bounce back will witness a flood of market entrants, only exacerbating the situation.
lets sit back and enjoy the music here, stocks arent looking so hot, and everyone knows it, and the market likes to do what everyone thinks it wont... usually....
stocks tank on predictably bad news from the fed,
and then before you know it, they will zoom.
thats my feeling once the USD makes its little run up and the market scares people like its 2008. its all too telegraphed and for the first time in my life im actually fully long no hedges and no cash, im all in and sick of waiting around as i have this sneaking feeling the market will after an intial period of weakness climb higher, especially gold.
i may be wrong of course, but at this point i could care less, im feeling strong in my stance and will stand fast through the current short term weakness where ever it brings us because im going to leave it there for the longer haul. looking at the market less and less frequently to restore a macro view, all the short term blips were clouding my judgement.
gold tends to spike up then fall for the remainder of the day, when it fails to past its high of a few days prior by running up to it and then failing, this generally portends that gold will fall.
when we move above a prior ST resistance point and stay above it w/ volume, its usually a sign that whatever medium term trend remains intact.
we had a classic test and failure today, but w/ volume low on both ups and downs its tough to put as much faith in this approach. though my own inclination based on the ongoing decline of the shares is that gold may need more time to work out its cup/handle potential failure before anything happens.
ive followed Twiggs work for some time and eventually figured out the algorithm to his analysis:
gold is at x
if gold breaches its prior high at y we may hit z
if gold fails at x we could go down to a which could mean eventually a move to b unless gold finds support at c.
this is to me exactly the same as Dan Norcini's commentary at JSmineset.com, it cleverly tells you nothing imho.
Twiggs has been wrong on several accounts but his stylistic obfuscation hides his errors or dilutes them because of so many possible scenarios.
i agree with much of the TA out there suggesting the 1210-1215 region to be a line in the sand.
a close above that would be to me a strong signal that we are prepared for the next assault on 1300 and into 2011 mr. sinclair's 1650 target. though i believe he thinks gold will hit 1600 or so prior to jan 2011. i just dont see it w/o a sudden and traumatic event.
barring that gold could meander here and take its next step down if it fails here, especially noting the weak volume. interesting action thus far.
i dont believe its fair for any of us to attack a stock for behaviors or tendencies that are endemic to its sector as a whole.
i do believe we must consider Kinross from a broader perspective, its current price is about where it was in late 2008. the stock after dumping hard then bouncing is heading back lower.
there is no clear indication why Kinross should outperform gold or the mining sector for 2010 or 2011, or why it has trended downwards since early 2010 while gold has moved higher.
my questions to Kinross would center around the usual issues facing miners:
1. hedging, both in gold, silver and possible base metals
2. US dollar hedging.
3. share structure with respect to executive/insider sales, options and term lenghts of its top brass.
as an investor holding the stock for the past 3 years I would ask how the stock is down considerably while the underlying asset it mines has almost doubled in price.
i would ask further, how would acquisition of a mine with gold raise their share price when a massive rise in the price of gold couldn't? is more gold really the answer for this outfit?
its counter intuitive but has anyone dared to ask the question?
interesting watching Kinross purchasing a jr. gold outfit and their stock tanks on large volume before rebounding today and tanking back down. Kinross is close to its lows relative to bullion from the 2008 crash.
for the fanatics who naively believed that industry consolidation and buy outs would enrich the sector please think again, these purchases are made by the same outfits that hedged gold against a falling price or so they thought in 2000 going forward. now why would their next move be savy?
Kinross and Yamana used to be stalwarts of the gold sector in canada, now they are nothing but forever falling stocks vs. gold. they will never have the kind of run up compared to gold simply because their business model is corrupt and has already enriched the insiders who sunk the stocks with shadow short positions.
i challenge any and every gold bug out there bullish on the gold shares vs. gold who think during the next run the GDX and others will rise past and exceed their prior highs relative to gold to explain why and to qualify it, which means giving proper rationale why they couldnt do it from $800 gold to $1200. what makes anyone think they will do it from $1200 gold to $1500?
"If only the weather permitted the courses to be open in February, I'd still be here."
I suspect if the weather was that good in February, Toronto would be unstoppable. The sheer size of the city, the low crime rates for its population base, its multicultural backbone, nightlife, restaurants and culture coupled with it being a 1 hour drive from the US border, the niagara wine region, cottage country and its economy, all of these factors make it such a great place to be already, even slightly better weather make it fan-freaking-tastic!!
while most places were undergoing slowdowns and recessions, here in the heart of the city there is a housing, condo and commercial building boom. all around me office towers, luxury hotels, condo's and houses being built in the heart of the city. no donought effect happening here, the downtown keeps growing and becoming a destination, while the suburbs become more dense and more built up with people looking for places to live.
from my office window i can look out on the CBC building, the convention centre, sky dome, CN tower, the towers of the financial district, the island airport, the island and beach, and the distillery district. yes traffic on the gardiner too, but what large great city doesnt have traffic.
we are blessed in many ways, but the weather is always the sort of hanger that people bemoan. living on the west coast for a while it seemed like the dominant thing to them, the idea of enduring long windy winters was too much. though i couldnt stand the long rainy seasons over there.
all in all we are very lucky to live in such a great city and for those who are just growing up here, they will have an even better and bigger city in the next 10-15 years as development plans continue at a quick pace. so much is happening here its great to be a part of it.
we suffer from a new york inferiority complex, and havent fully shed our roots as Montreal's ugly step sister. toronto is the only large city i know that openly admits a sister city like Montreal is a great place, but montrealer's will spit on the ground if you ask them about T.O.. in a sense we can never become a new york or a montreal, but i like to think we are the best of both.
_______
do i sound like an ad man for tourism toronto? ha!! im in a charitable mood this morning, too bad i cant say the same about gold!
"Oh! Thank you for correcting me. I'll go tell my brother the insurance executive that he's wrong, then."
i would ask him to clarify his thoughts on earnings of an insurance company as your statement could only be considered right in certain scenario's:
if insurance company A takes in $1000 in premium payments from it's customers, and invests all of it (which they dont do, only part of it) in the market, they would need to earn more than %100 annually to claim that most of their earnings are via capital appreciation of invested assets non?
the way you could be construed as correct is if the company has an existing capital base large enough that the %5-10 per year they earn on these funds exceed total premium payments for that same year. (which is a bigger source of earnings; premiums or return on investments?) That being the case, "most of the money" they earn would come from investment returns, but %100 of those investment returns originated via premiums paid, and their ability to invest X amount is based on ongoing premium payments and limited pay-outs.
ultimately the source of an insurance company's earnings originate from premiums collected, as they provide the wiggle room for investment of funds and allow adjustments to any risk-profiles for investment.
most of the money made by insurance companies is from premiums.
additional earnings are gained by investing those premiums in a host of market vehicles but said earnings account for a fraction of the bulk of their total earnings via premiums.
insurance companies have struggled for some time simply because they are run by the same oligarchical leaders that plundered the large financials. its simple:
insurance companies increasingly lobby the governments to limit how much they are required to pay out for a host of claims via auto, life or accident benefits while also lobbying to increase premium rates. couple this with cost cutting and outsourcing and you have a business that should be ideally suited to growing earnings and stock prices.
the opposite has happened w/ stock prices therefore something must be happening at the upper echelons of these organizations that are removing any real share price growth potential... imho these are an awful long term investment and will continue to be so. check back with this 1, 2 and 3 years from now to see where MFC is. they cant make money for shareholders.
that article and others of its ilk are total nonsense.
we have heard about china "buying" gold for 6 years, none of it makes any sense or has any basis in reality. if china buys gold someone must sell it to them.
there are no shortage of economists or "advisors" that will issue a host of recommendations. china has also heavily purchased US t-bills for some time but they havent exactly done well the past decade.
lets avoid posting such articles alltogether as they come up each week and amount to nonthing imho.
"Let me just say your quaint notions of pharmaceutical bargains and cheap surgeries in Central America in a deflationary world makes me LAUGH OUT LOUD"
good to hear you beat the odds and are a cancer survivor doctor,
my 'quaint notions' of the medical industry are neither quaint nor notions. the vast majority of surgical procedures performed in the US are also done by doctors outside the US, and while the best and most innovative will continue to be americans we shouldnt exclude the rest of the planet from being considered capable of providing safe and effective care for the host of conditions that millions of americans go under the knife for ever year:
hip and knee replacement
heart surgery
arthroscopic surgery
bariatric surgery
plastic surgery
Punta Pacifica Hospital in Panama has been under direct supervision of John Hopkins International and has a thriving medical tourism industry.
your comments contain what i consider a fairly typical american attitude towards other nations, as if to suggest that "central american" states or india and other emerging economies lack the most basic capabilities to perform surgeries that are routine in america.
face facts, hip surgery in a proper central american clinic can cost 1/2 of what it does in the US, and the question of how good is subjective considering there is a vast difference among hospitals within america as well.
not everyone can get or can afford the best of the best for any type of surgery, you dont see a surgeon to get a stich on your cut finger, nor do you need a team of 12 of the best orthopods to conduct routine arthroscopic knee surgery. its a question of making best use of existing resources.
we have enough examples of mistakes at hospitals in america to know that even the best make errors, the question is across the board can other nations be trusted to perform some tasks? we let other nations do most other things that require expertise, why is medicine immune?
a fair response grym,
though i believe we are looking at 2 very different things.
i cannot recall a time in my rather short life when the common theme was not about helping the economy and about people struggling. this theme repeats itself no matter what the state of the economy is, especially in the US where every election campagin is principally about jobs. why?
because at any given time there were rust belts in mining, manufacturing and other old guard industries that were the fodder for the whole "decline of american empire" that people have been bemoaning about for 80 years.
yes right now things are worse than they were a few years ago, but in spite of the boom times look at the rhetoric coming from most pundits and politicians for the past several decades, its the same:
reduce deficits, balance budgets, focus on economy, create jobs, fund innovation... blah blah blah blah.
certain destruction was always just around the corner, if it wasnt the hun's in WW2 it was the communists, then the japanese, now its the chineese, terrorists and evangelicals....
the idea is that what we expect is much higher than it was several decades ago, (as per my middle class family comparison) thus people see a decline in this higher expectation as an overall decline which in reality is simply a fall from the high point. its like gold "falling" to $1050, which would be met with sadness and described by the bugs as a "collapse", yet 3 years ago the idea of $1050 gold was fantasy.
we have come far over the past 40 or 50 years both in real terms and globally. but the super boom of the early 2000 left us a bit ahead of ourselves. in reality price increases are subject to a host of different factors. those apples being purchased may cost more now simply because its cheaper to sell those apples overseas, or to apple sauce producers, or to use apple tree land for corn. for better or worse, buying apples by the basket is not a logistically sound as it once was. hence they cost more. considering the cost of many grains and softs are above 10 year levels its not surprising, but those prices are below those of about 2 years ago, so something else is causing existing price rises, and i dont believe its any sort of monetary inflation just yet.
ultimately insurance costs more because insurance companies must convince us that costs are rising to justify higher premiums. when times were great costs still went up, even with crime at all time lows police budgets still rise year over year in canada. but a cop's salary is higher now than the 70's, is that inflation or that cops now have advanced degrees they never used to, must learn to use computers and conduct more complex tasks than 40 years ago. lower crime is better and saves money from the imprisonment standpoint but is lower crime a product of better cops? if so the cost is worth it and doesnt reflect any sort of inflation, only skill sets.
back to my medical perspective. there are a host of opinions but i will provide this basic fact:
MRI's were almost nonexistant 40 years ago, people with lumps on their head that didnt meet certian diagnostic criteria would be sent home. if complications developed surgery may have been planned. for all the people who went home and didnt require care, medical costs stopped there, and quite a few may have then went on to die because of swelling that wasnt caught. MRI's come along and mandates change, serious bumps on the head require MRI's, and eventually some not so serious ones if they meet said criteria. now we incur a $300 cost(aprox) in all cases vs. the higher costs in just a few cases.
all in all i feel safer knowing this technology can help prevent complications, but it has a net cost to our system, but its worth it non? is it inflation if healthcare costs rise due in no small part to emerging diagnostic fees which we never incurred just a few decades ago?
heart surgeries are becoming more routine, they cost less and are safer than those of 40 years ago. what will happen when india obtains the same equipment and even better and with their lowered costs can offer the same level of skill and safety for surgery at 1/4 the cost? will insurance companies realize the beneift that flying a person to india for surgery is still cheaper than just paying for american care?
if things get as bad as many doctors will claim, if they are unable to keep up on what they are allowed to charge, eventually the market will shift, and you will see the proliferation of clinics as we are already seeing for medical tourism. drugs too eventually. its cheaper to pick up what you need for the year in costa rica and save a few thousand (if youre on alot of meds) and have a vacation and hip replacement while your down there for a fraction of the cost.
how can this happen? innovation and expertise making medical care that was once only accessible to the skilled and wealthy more available to all.
i can zap a skin tag with a $10 kit from the pharmacy, something that just 10 years ago required a $120 MD visit and procedure. somehow this was deemed safe enough to be trusted to citizens, saving me $110 that i may have to spend on the higher price of my groceries. is that really inflation?
"no inflation in my medical premium, energy bills, tuition, groceries"
inflation in groceries is too vauge, some have gone up while others have gone down. the price of meat (steak, chicken and fish) is notably cheaper year over year at my costco. improvements in supply chains (including china) and flash freezing for fish has allowed more to come to market at cheaper prices than previously, but the cost reductions have nothing to do with inflationary effects as much as logistical.
the same with beef in which meat sold in bulk a la costco is cheaper than at the grocery store. for those who note a price increase they may be looking at specific things but it may or may not be the result of inflation, especially considering many commodities are below their peak of 1-2 years ago. something else is at play.
medical bills and insurance always goes up, no matter inflation, deflation or stagflation.
rising prices in these items are not imho indicative of the type of inflation we are referring to when discussing precious metals, as the rising cost of beef is not really correlated to the POG, there are simply too many factors at play.
natural gas is at a serious down trend while other energy/PM's are steadily rising.
inflation is like crime rates, no matter what the stats say people will always perceive crime to be high and rising. we are at historical lows for crime here in canada, already a safe nation in general, yet media is saturated with images of crime and violence and even clear statistical evidence does nothing to sway people.
thus people behave as if things are more dangerous and feed a self-validating perception each time they do hear of specific crimes. much the same way with cost increases, anyone who remembers the 60's and 70's knows that the average middle class dwelling and lifestyle was materially much less than what we percieve it to be now. a typical family home now is much large, has a garage, though more likely a 2 car garage, instead of vacations to cottage country or florida its all-inclusives to the carribean, and delux cable.
the difference is our standards are different and it is more difficult to keep up with what we beleive to be a standard of living, those steaks may cost more but thats because you believe them to cost more of your limited share of income which may or may not have kept up.
the medical industry much like the insurance industry will never ever ever finally sit back and say that prices are commensurate. they will continue to push much like the manufactures have to rise prices, to demand more for what they do. the issue is not if you are deserving, its a matter of price rises will be the result of lobbied and collective action by a specific group, not the result of inflation.
as MRI's get cheaper, as india increases the pace of their medical facilities, and as the mid-teir of medical jobs that used to require considerable education become more accessbile to more people, wages will not continue to rise as they did, and being a doctor or a nurse will be all the less lucrative just like a carpenter's salary could raise a family 50 years ago a doctor will soon been just a decent middle class earner.
everyone will want to up their wages because of their belief that prices elsewhere are rising. the government of ontario lowered their costs for MRI's by about %25 citing the increased availability of lower cost and more efficient MRI's in the Provence. essentially new machines and ongoing innovation forced the providers into lowering prices simply because they now know the next generation machines can produce better images at lower costs.
that type of payment reduction represents efficiencies and innovations, and is rarely considered during discussions of costs, no only the increases are referred to and most remembered.
medicine is undergoing a change in some respects, many areas are now easily transferable to less educated people who can demand lower wages. something only nurses did 30 years ago is done by a RNA or technician. these represent improvements (just like having to see a doctor for a script for meds that eventually are avaible over the counter, that represents less costs for the system when someone doesnt have to see a doctor to get meds)
eventually surgery, done by robots and minimally invasive methods will improve to the point where less and less people are needed with the kinds of advanced skills that high level surgoens require as more surgery will become routine. (and new innovation will be directed towards other fields or areas, boosting the entire efficiency process).
what im saying is that your steak may cost more, but your home heating (gas) may cost less, and your car may require less on maintenance costs than those of 30 years ago when steak was half the price, and you spend $50 less for meds because you need only drive to the pharmacy, not the doctors for an appointment too. picture this efficiency process occuring in a host of areas of your life.
1/3 position of gold sold today.
feeling that this is a weak spike up on low volume,
GDXJ is leading the way, not what I like to see,
most miners are not looking good today on what should be a stronger up day.
my feeling is a possible large downward swoop is looming right now,
but in context of a larger upward trend.
careful gang, i feel better having unloaded 1/3 and can reload later.
while many feel a dump in the broad markets is in the cards, i feel the market will move against most people as it always does, leaving many behind or leaving many broke with unsustainable short positions.
being bearish and down on the economy is becoming too much in fashion, with every tick up in the indicies someone switches to slighly bearish or cautious stances just to avoid being the guy who was bullish before the dump. this kind of protectionism creates an industry that will continue to not earn solid returns for clients as they are long when they shouldnt be and cautious when nothing is happening. imho.
gold is different, it can dump $100 in a day while the broad market sill moves. the anticipation of stimulus or of inflationary forces is what drives gold, while the actual implementation happens long after gold has baked this in the cake. be cautious about over inflationary interpretations, we have been waiting for this official inflation for years and its not unfolding as most said it would (despite their obsfucation that it may have).
short gold in the AM and long gold in the PM would prove more profitable than long only gold in the AM since 2001. rigged? hmmmmmmmmmmmmmmm
http://www.zerohedge.com/article/guest-post-100-mi...
for the cunucks:
XFN.TO
XEG.TO
two of the larger if not the largest shares of the TSX are energy (nat gas, oil, oil-sands)and Financials. (materials is too broad of a term to be considered a true sector imho)
check out the breakdown on these 2 etf's which give a great snapshot of the movements of the TSX.
not looking good, but the volume is somewhat flimsy.
gold looking good but once again the volume is not impressive at all on the recent run up. if we truly have further weakness in the market we need to see some indication that gold is truly ready to break free of its chains, for now im still wondering if it will simply be as Bill says "last off the dancefloor" while the gold-bugs are chanting that the great disentanglement between gold shares and the market has happened....
back and forth like a fiery salsa gold is twirling around,
moving upto 1233 as we speak, gold stocks moving well especially in spite of a weak market.
for the canadians:
check the XFN and the XEG which track the financials and the gas/oil sector respectively, i note both are breaking down on reasonable volume towards their recent lows and on a 3 year chart you can see the proverbial cliff they appear to be about to fall off of.
it may be too obvious to actually happen, yet i cant help but think things are looking ripe for intervention, more than anything the powers that be dont want to see another stock market plunge, even if it has little material affect to most citizen, the psychology of plunges is what they fear, even after the 2008 dump it was all people could talk about. even employment stats and home prices crashing dont generate the kinds of rhetoric and journalistic fluttering that market crashes do.
look out.
look up in the sky,
its a bird!
its a plane!
no, its a possible break out in the GDX vs. bullion!!!
no friggin way i said... but i bow before the objective analysis that demands I speak the TA truth:
http://jglobal.blogspot.com/2010/08/breakout-for-g...
today is a great time to test out my theory that when gold jumps up pre-market, it tends to spend the rest of the day moving sideways to down before market close.
if this pattern continues i believe we will see another leg down, as this last leg up was on considerably weak volume across the spectrum of gold vehicles (metal, shares, ETF's)
if we hold this as the USD takes a small swan dive on the daily charts, and not give back the pre-market gains, then my broader theory that we are headed for new highs stays in place.
as i have suspected for some time, gold will rise even if the USD rises, but oil will not. it barely could run up during the gulf oil spill, something that only 1-2 years ago would have made it seem as though $100 was in sight.
what i would like to see is a lower USD coupled with lower oil, and at least 3 quarters of this before i check back with the miners to find out just how well they have done now that their alleged 2 biggest problems (energy costs and high USD costs) have been removed, while their biggest issue (the POG) has been running for some time waiting for them to catch up.
i suspect it will be a make or break moment if gold breaks to Jim Sinclair-esque highs of $1500-$1600 and the shares barely breach their 2008 highs, still complaining forever of problems and an inability to profit.
until then, its all bullion all the time. too many are fearful of a market crash, and while the chance is always there i suspect w/ so much anticipation of a dump and cash in hand, any sort of bounce back will witness a flood of market entrants, only exacerbating the situation.
lets sit back and enjoy the music here, stocks arent looking so hot, and everyone knows it, and the market likes to do what everyone thinks it wont... usually....
2 charts that should tell us exactly whats wrong and why no amount of falling wedge will help this stock, or most others like it.
http://jglobal.blogspot.com/2010/08/farce-that-is-...
its a trap gang,
stocks tank on predictably bad news from the fed,
and then before you know it, they will zoom.
thats my feeling once the USD makes its little run up and the market scares people like its 2008. its all too telegraphed and for the first time in my life im actually fully long no hedges and no cash, im all in and sick of waiting around as i have this sneaking feeling the market will after an intial period of weakness climb higher, especially gold.
i may be wrong of course, but at this point i could care less, im feeling strong in my stance and will stand fast through the current short term weakness where ever it brings us because im going to leave it there for the longer haul. looking at the market less and less frequently to restore a macro view, all the short term blips were clouding my judgement.
good luck gang, and god's speed.
interesting point,
i take a simple approach:
gold tends to spike up then fall for the remainder of the day, when it fails to past its high of a few days prior by running up to it and then failing, this generally portends that gold will fall.
when we move above a prior ST resistance point and stay above it w/ volume, its usually a sign that whatever medium term trend remains intact.
we had a classic test and failure today, but w/ volume low on both ups and downs its tough to put as much faith in this approach. though my own inclination based on the ongoing decline of the shares is that gold may need more time to work out its cup/handle potential failure before anything happens.
ive followed Twiggs work for some time and eventually figured out the algorithm to his analysis:
gold is at x
if gold breaches its prior high at y we may hit z
if gold fails at x we could go down to a which could mean eventually a move to b unless gold finds support at c.
this is to me exactly the same as Dan Norcini's commentary at JSmineset.com, it cleverly tells you nothing imho.
Twiggs has been wrong on several accounts but his stylistic obfuscation hides his errors or dilutes them because of so many possible scenarios.
i agree with much of the TA out there suggesting the 1210-1215 region to be a line in the sand.
a close above that would be to me a strong signal that we are prepared for the next assault on 1300 and into 2011 mr. sinclair's 1650 target. though i believe he thinks gold will hit 1600 or so prior to jan 2011. i just dont see it w/o a sudden and traumatic event.
barring that gold could meander here and take its next step down if it fails here, especially noting the weak volume. interesting action thus far.
appreciate your gain on this stock Bill,
i dont believe its fair for any of us to attack a stock for behaviors or tendencies that are endemic to its sector as a whole.
i do believe we must consider Kinross from a broader perspective, its current price is about where it was in late 2008. the stock after dumping hard then bouncing is heading back lower.
there is no clear indication why Kinross should outperform gold or the mining sector for 2010 or 2011, or why it has trended downwards since early 2010 while gold has moved higher.
my questions to Kinross would center around the usual issues facing miners:
1. hedging, both in gold, silver and possible base metals
2. US dollar hedging.
3. share structure with respect to executive/insider sales, options and term lenghts of its top brass.
as an investor holding the stock for the past 3 years I would ask how the stock is down considerably while the underlying asset it mines has almost doubled in price.
i would ask further, how would acquisition of a mine with gold raise their share price when a massive rise in the price of gold couldn't? is more gold really the answer for this outfit?
its counter intuitive but has anyone dared to ask the question?
lets see, gold had a wonderful little pop on very low volume as the USD bounced off a very over-sold condition from the .80 level.
gold shares.... dont even ask.
i was reading Ron Rosen's catastrophic predictions of an HUI collapse and found it interesting: http://www.kitco.com/ind/rosen/aug032010.html
interesting watching Kinross purchasing a jr. gold outfit and their stock tanks on large volume before rebounding today and tanking back down. Kinross is close to its lows relative to bullion from the 2008 crash.
for the fanatics who naively believed that industry consolidation and buy outs would enrich the sector please think again, these purchases are made by the same outfits that hedged gold against a falling price or so they thought in 2000 going forward. now why would their next move be savy?
Kinross and Yamana used to be stalwarts of the gold sector in canada, now they are nothing but forever falling stocks vs. gold. they will never have the kind of run up compared to gold simply because their business model is corrupt and has already enriched the insiders who sunk the stocks with shadow short positions.
i challenge any and every gold bug out there bullish on the gold shares vs. gold who think during the next run the GDX and others will rise past and exceed their prior highs relative to gold to explain why and to qualify it, which means giving proper rationale why they couldnt do it from $800 gold to $1200. what makes anyone think they will do it from $1200 gold to $1500?
good luck gang, dont say you havent been warned.
"If only the weather permitted the courses to be open in February, I'd still be here."
I suspect if the weather was that good in February, Toronto would be unstoppable. The sheer size of the city, the low crime rates for its population base, its multicultural backbone, nightlife, restaurants and culture coupled with it being a 1 hour drive from the US border, the niagara wine region, cottage country and its economy, all of these factors make it such a great place to be already, even slightly better weather make it fan-freaking-tastic!!
while most places were undergoing slowdowns and recessions, here in the heart of the city there is a housing, condo and commercial building boom. all around me office towers, luxury hotels, condo's and houses being built in the heart of the city. no donought effect happening here, the downtown keeps growing and becoming a destination, while the suburbs become more dense and more built up with people looking for places to live.
from my office window i can look out on the CBC building, the convention centre, sky dome, CN tower, the towers of the financial district, the island airport, the island and beach, and the distillery district. yes traffic on the gardiner too, but what large great city doesnt have traffic.
we are blessed in many ways, but the weather is always the sort of hanger that people bemoan. living on the west coast for a while it seemed like the dominant thing to them, the idea of enduring long windy winters was too much. though i couldnt stand the long rainy seasons over there.
all in all we are very lucky to live in such a great city and for those who are just growing up here, they will have an even better and bigger city in the next 10-15 years as development plans continue at a quick pace. so much is happening here its great to be a part of it.
we suffer from a new york inferiority complex, and havent fully shed our roots as Montreal's ugly step sister. toronto is the only large city i know that openly admits a sister city like Montreal is a great place, but montrealer's will spit on the ground if you ask them about T.O.. in a sense we can never become a new york or a montreal, but i like to think we are the best of both.
_______
do i sound like an ad man for tourism toronto? ha!! im in a charitable mood this morning, too bad i cant say the same about gold!
manx928 said:
"Oh! Thank you for correcting me. I'll go tell my brother the insurance executive that he's wrong, then."
i would ask him to clarify his thoughts on earnings of an insurance company as your statement could only be considered right in certain scenario's:
if insurance company A takes in $1000 in premium payments from it's customers, and invests all of it (which they dont do, only part of it) in the market, they would need to earn more than %100 annually to claim that most of their earnings are via capital appreciation of invested assets non?
the way you could be construed as correct is if the company has an existing capital base large enough that the %5-10 per year they earn on these funds exceed total premium payments for that same year. (which is a bigger source of earnings; premiums or return on investments?) That being the case, "most of the money" they earn would come from investment returns, but %100 of those investment returns originated via premiums paid, and their ability to invest X amount is based on ongoing premium payments and limited pay-outs.
ultimately the source of an insurance company's earnings originate from premiums collected, as they provide the wiggle room for investment of funds and allow adjustments to any risk-profiles for investment.
manx928,
most of the money made by insurance companies is from premiums.
additional earnings are gained by investing those premiums in a host of market vehicles but said earnings account for a fraction of the bulk of their total earnings via premiums.
insurance companies have struggled for some time simply because they are run by the same oligarchical leaders that plundered the large financials. its simple:
insurance companies increasingly lobby the governments to limit how much they are required to pay out for a host of claims via auto, life or accident benefits while also lobbying to increase premium rates. couple this with cost cutting and outsourcing and you have a business that should be ideally suited to growing earnings and stock prices.
the opposite has happened w/ stock prices therefore something must be happening at the upper echelons of these organizations that are removing any real share price growth potential... imho these are an awful long term investment and will continue to be so. check back with this 1, 2 and 3 years from now to see where MFC is. they cant make money for shareholders.
that article and others of its ilk are total nonsense.
we have heard about china "buying" gold for 6 years, none of it makes any sense or has any basis in reality. if china buys gold someone must sell it to them.
there are no shortage of economists or "advisors" that will issue a host of recommendations. china has also heavily purchased US t-bills for some time but they havent exactly done well the past decade.
lets avoid posting such articles alltogether as they come up each week and amount to nonthing imho.