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Black September is Here Again!

01 Tuesday Sep 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, agricultural commodities, alternate energy, Alternate Fuel Sources, alternative Energy, banking crisis banks bear market bull central deflation depression economic trends economy financial futures gold inflation crash Markets precious metals price protection recession safety silver plati, banks, bear market, Bear Trap, bonds, bull market, China, Comex, commodities, Copper, crash, Credit Default, Crude Oil, Currencies, currency, Currency and Currencies, dollar denominated, dollar denominated investments, Dow Industrials, economic, Economic Recovery, economic trends, economy, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, follow the money, follow the news, Forex, Fundamental Analysis, futures, futures markets, gata, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, Government Spending, hard assets, heating oil, How To Invest, How To Make Money, hyper-inflation, India, inflation, Investing, investments, Jschulmansr, Junior Gold Miners, Latest News, Long Bonds, majors, Make Money Investing, manipulation, Market Bubble, market crash, Markets, mid-tier, mining companies, mining stocks, NASDQ, natural gas, Natural Resources, oil, Paladium, palladium, physical gold, platinum, platinum miners, precious, precious metals, price, price manipulation, prices, producers, production, risk, run on banks, S&P 500, safety, Saudi Arabia, silver, silver miners, Silver Price Manipulation, small caps, sovereign, spot, spot price, stagflation, Stimulus, stock market, Stocks, The Fed, Tier 1, Tier 2, Tier 3, TIPS, Treasury, U.S., U.S. Dollar, U.S. Government unfunded Debt, U.S. Treasury Dept, warrants, XAU

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ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, bonds, Brian Tang, bull market, CDE, CEF, central banks, China, cobalt, Comex, commodities, Copper, crash, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, geothermal, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, Green Energy, GTU, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Jschulmansr, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, power, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

Well the dog days of summer are over and September is blowing in. As the brilliant colors of autumn are starting to bloom with the leaves turning orange, gold and crimson; the leaves are starting to drop. That’s not all that is starting to fall, stocks are beginning their seasonal drop. If you haven’t taken profits please do so. We will see one more push up in stocks as they form the right shoulder of the head and shoulders formation on the chart. We have just finished the head with the right shoulder to follow (DJIA). 9200 (DJIA) is the first support, next roughly 9125-9080. A decisive break below the 50 day moving average or 9000 will be absolute confirmation of the new bear market downtrend. Commercial real estate is one of the next factors (shoe) about to drop. In addition the tax break for buying a new home is about to end, and the auto industry will not have cash for clunkers to fall back on. Late Breaking China has said NO to Credit derivatives and any losses from them. This is definitely not good for the US markets. So get rid of your more speculative stocks move to good yielding stocks in industries that people have to buy the products in good times or bad times. On the rest move your stops very close w/in 10% trailing. Maybe also look at selling covered calls or puts to lock in profits and earn a little income on the side.

Gold and Precious metals are coiled up ready to spring dramatically to the upside. Countdown is almost over, ignition commencing. We have a nice little triangle in Gold. Personally, I feel we will see the breakout to the upside after a little false breakout to the downside. In other words I fell it will go down like this, first we will see Gold test the $930 level as the Big 3 shorts make one more desperate effort to save themselves. However I feel that Gold will hold and climb back to $950 and then break above $965. When that happens the next resistance will be $980, then $1000, and then a 2nd test for the all time high at $1032. I think it will successfully break that level and hit at least $1250 before the end of the year with a potential to actually hit $1325. Keep accumulating companies with a low cost of production, junior and mid tier producers with current or about to start production. There are still many bargains which I will start featuring here on the blog.

I apologize for the recent lack of posts over the past month. Since I lost my day job, I decided to go back to school again so to speak by taking a few intensive trading and technical analysis courses to refresh up again. Since my new job will be trading the markets, I will be sharing my picks and option trades, forex trades, along with choice stock picks. Wishing all of us Great Investing! -jschulmansr

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Exposed! Five Myths of the Gold Market and find out:

  • · Who’s been driving this record bull-run in gold?
  • · What Happens When Inflation Kicks In?
  • · Why most investors are WRONG about gold…
  • · When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

==============================================

John Licata Still Eyeing $1200 Gold in 2009 – GoldSeek.com

Bullish on gold since it carried a $400-per-ounce price tag, Blue Phoenix Chief Investment Strategist John Licata expects the king of metals to ring in the New Year with a $1,200-per-ounce crown. As he told The Gold Report in April, he still considers gold one of the best asset plays in the world. With recovery on the horizon, he’s also high on silver—in part because a pickup in manufacturing will drive up demand. While he says it’s premature to claim economic recovery, he isn’t looking to copper to serve as the traditional harbinger of a return from recession this time. His rationale? Good economic news—while too inconsistent to make recovery imminent—is already baked in to copper’s climb already this year.

The Gold Report: You weren’t too bullish on seeing a recovery in 2009 when we caught up with you in April. We’ve seen some good Q2 reporting from a variety of companies and some encouraging economic data. The government is starting to claim we’re in recovery. What’s your take on this?

John Licata: I do think we’ve seen some better domestic economic data, but it’s premature to think we’re totally out of the woods. In terms of corporate earnings, a lot of company profits might have surprised to the upside, but they’re still down 50% to 70% from quarters before or the prior year.

Many companies have been trying to compare Q1 and Q2. You’re still not seeing dramatic differences to the upside. Quite frankly, some companies are still living within cash flow and I think that’s one of the reasons why we could have a problem with supply and demand imbalances as we come to the end of 2009 and enter 2010.

Unemployment is likely to keep rising. Although the last numbers were much better than anticipated, I don’t think we’ve seen the green light that will cause people to start hiring again. We could hit 10% unemployment by the end of the year, and that’s going to be a precursor to some weaker retail heading into the holiday season. Net-net, you probably could put the word ‘inconsistent’ toward most of the economic data coming out of the U.S.

The industrial numbers that came out of China a couple of weeks ago [August 10] were actually below expectations as well. While everyone wants to be bullish and the data is somewhat better than many expected, it’s still not great. So I think to claim victory right now is definitely premature.

TGR: You mentioned a supply-demand imbalance. What do you see on that front?

JL: Companies are not putting money back into infrastructure. For that reason, once demand actually starts to increase, supply levels will be shockingly different from what people might expect.

TGR: Are you differentiating between the BRIC countries and North America in that regard?

JL: I’m not just looking at the BRIC countries as the barometer for the economic pulse. I don’t even think China is the saving grace for commodities. But I do think what is going to be indicative for a recovery is to see demand pick up, to start seeing jobs pick up again, more consistently; not just one month out of six. We need to see consistent job growth.

TGR: When do you think demand might pick up?

JL: Q3, perhaps Q4, is when we probably can start seeing demand start picking up and I think that’s when we’re going to start to see overall a global economic recovery. I’m skeptical that it can happen before Q4.

TGR: Is that worldwide demand pickup you’re anticipating?

JL: I’m referring to North America.

TGR: Can demand pick up before unemployment abates?

JL: It can happen before, but I think demand and employment will increase in tandem.

TGR: In our previous conversation, you compared the investment opportunities in oil, natural gas and gold to one another. At this point, which of these three sectors do you think offer the greatest return?

JL: Because of the upside that I think could happen over the next 12 months, I would rate natural gas first, gold second and oil third. For right now, I’m conservatively optimistic on oil. Although short term we might have a pullback, I’m still bullish on the price of oil. I think oil will trade north of $80 by year end, and I think we’ll again see triple-digit oil within the next two years. A lot of major wells in the world are not as productive as they once were and when it comes to demand increasing because the overall economic health around the world is picking up, we could be in trouble in terms of supplies. That relates to the metals as well as energy.

TGR: Speaking of metals, your outlook for gold?

JL: I continue to maintain that we could see $1,200 gold prices by year-end. I think gold is very much on the way to hitting that pretty aggressive price target. The miners themselves seem pretty confident on the upside for gold.

TGR: In April, you described gold as one of the best asset plays in the world and your recommendation to investors was to focus initially on physical gold. Have you changed that viewpoint?

JL: No. I’ve been bullish on gold since it was below $400. But now I am starting to see some opportunities in the equity side of the gold market that are becoming very appealing and I didn’t see that when we last spoke.

TGR: Are you still bullish on platinum and palladium, too?

JL: I am still enthusiastic, but not as bullish on either of them just because we have seen a bit of a run since April. I’d rather be in silver. I think silver gets forgotten when we start talking about precious metals. As opposed to platinum or palladium, I would rather be in the silver space.

TGR: Is there anything in particular in silver that you’re finding appealing?

JL: I just think if we’re talking about an economic recovery in the back half of this year into 2010 and silver is mostly used for industrial purposes, I honestly think that silver prices are just forgotten. When people start talking about the inflation hedge, they jump into gold. If they start talking about the economy improving, they jump into copper. They tend to forget that silver is actually used for much manufacturing. So I think that is the forgotten metal and I do think that silver prices can move a lot higher, especially as gold prices march through $1,000.

TGR: As you say, people look to copper as the leading metal to point to in terms of a recovery. What’s your feeling about copper?

JL: You hit the nail on the head. Everyone starts to talk about copper, but nothing has jumped out at me to say that copper prices have much more upside. Copper prices are up nearly 100% year-to-date, so I think a lot of the recovery that many people are talking about has been priced in already.

The Baltic Dry Index, an index that just had the biggest monthly drop since October (down 28% in August), has been down because people fear that China might cut back on buying iron ore and coal. If that happens, copper prices won’t be immune. Copper supplies have been tight for the last couple of quarters. If anything, we’re trading about 35 cents or 40 cents above the recent 50-day moving average. I think copper is over-extended right now.

TGR: Any last comments before we meet again?

JL: Only that while it’s a difficult marketplace and I do expect tight markets around the world to continue, some of the plays we’ve talked about have the makings of a pretty successful portfolio.

After studying economics and graduating from Saint Peter’s College in New Jersey (where he received the Wall Street Journal Award for economic excellence), John J. Licata set his sights on Wall Street. During his career, John has held both trading and research positions on the NYMEX, Dow Jones, Smith Barney and Brokerage America. Early in 2006, he founded Blue Phoenix, Inc., an independent energy/metals research and consulting firm based in New York City. John, the company’s Chief Investment Strategist, has appeared regularly in the media (CNBC, Bloomberg TV/Radio, Business News Network (BNN), Barron’s, The Wall Street Journal, Chicago Sun, Los Angeles Times, etc.) over the years for his insights/forecasts in the commodity spectrum.

Streetwise – The Gold Report is Copyright © 2009 by Streetwise Inc. All rights are reserved. Streetwise Inc. hereby grants an unrestricted license to use or disseminate this copyrighted material (i) only in whole (and always including this disclaimer), but (ii) never in part.

================================================

Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

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Hey Buddy Got a Jack I can Use? – Fixaflat 2

23 Thursday Apr 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, agricultural commodities, ANV, Austrian school, AUY, Bailout News, banking crisis, banking crisis banks bear market bull central deflation depression economic trends economy financial futures gold inflation crash Markets precious metals price protection recession safety silver plati, banks, Barack Obama, bear market, Bear Trap, bilderbergers, Bollinger Bands Saudi Arabia, bonds, Brian Tang, bull market, capitalism, CDE, CEF, central banks, China, Comex, commodities, Contrarian, Copper, Council on Foreign Relations, crash, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, Dow Industrials, economic, Economic Recovery, economic trends, economy, EGO, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, follow the money, follow the news, Forex, FRG, Fundamental Analysis, futures, futures markets, G-20, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, heating oil, HL, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Jschulmansr, Keith Fitz-Gerald, Latest News, majors, Make Money Investing, Marc Faber, Market Bubble, market crash, Markets, Michael Zielinski, mid-tier, mining companies, mining stocks, monetization, Moving Averages, NAK, NASDQ, New World Order, NGC, NWO, NXG, oil, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, Short Bonds, silver, silver miners, Silver Price Manipulation, SLW, small caps, socialism, sovereign, spot, spot price, stagflation, Stimulus, stock market, Stocks, SWC, Technical Analysis, The Fed, TIPS, Today, U.S., U.S. Dollar, volatility, warrants, XAU

≈ Comments Off on Hey Buddy Got a Jack I can Use? – Fixaflat 2

Tags

ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, bonds, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Copper, crash, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

Hey Buddy, got a spare jack I can use? The fixaflat turned out to be nothing but hot air and evaporated! So now I need a jack to change the tire so I can get this economy back on the road.

Some very interesting conspiracy theories coming out about Goldman Sachs and Paulson, which leads one to question why did the AIG exec committ suicide? There have been stories on the net that he really was murdered even!

My question is what did he know about Freddy Mac’s books? How much of our taxpayer money was diverted elsewhere? Who are the people whose pockets got lined? Could this scandal be pointing back to Mr. Dodd and Mr. Frank? Mr. Cuomo here is something else you need to be investigating (if you’re not already). 

We are now hearing about Bank of America being forced into buying Merrill Lynch! The rats are Ratting! I will say it again the other shoe is getting ready to drop. They are busy juggling it like a seaming hot potato, but it will drop.

Well the Dow managed to eke out a little gain in spite of more bad news for the economy. For me, it was a great opportunity to buy more (SKF) at $58.89 and I decided to also buy some (DXD) at $56.23.

The DOW may make another try at 8000 but it will fail and (DXD) will do quite nicely thankyou.

For (SKF) I’m looking at a gap that needs to be filled around the $90 mark so that is my first target for now. 

For Gold it broke $900 and closed above that. Next target $928.00 then $950, then $980. If all of those are successfully broken (which I think they will), then look for new all time highs!

That’s it for now- Have a Great Evening! – Good Investing! – jschulmansr

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 ===================================================

 A new site that is in pre-launch state that will become a virtual world – chat, shop, play, videos, etc. Anyways they are giving free shares (that should become actual company shares) to anyone who signs up and more shares if you refer people.===================================================

 

                                         – Trend Analysis Revealed –

 

Substantial moves like the ones that we have recently witnessed present opportunities to succeed or fail in the markets. Traders who stayed on the correct side of the trend were rewarded substantially.

Serious questions effecting your portfolio still remain:

– Have we seen the Indexes bottom or top?
– Is a reversal in the near future?
– Is it too late to go short?

Stay on the correct side of the market. Let our Trade Triangle technology work for you. It’s free, It’s informative, It’s on the money.

Free Instant Analysis delivered to your email inbox. Analyze ANY Stock, Futures, or Forex symbol.

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Bespoke’s Commodity Snapshot – Seeking Alpha

Source: Bespoke Investment Group

Below are our trading range charts for ten major commodities. The green shading represents 2 standard deviations above and below the commodity’s 50-day moving average. When the price moves above or below this green shading, the commodity is in extreme overbought or oversold territory.
As shown, after reaching overbought territory a few weeks ago, oil has pulled back to just above the middle of its trading range. Natural gas, on the other hand, can’t get out of the downtrend that it has been in since last June. After trending higher since last October, gold and silver have recently moved to the bottom of their trading ranges, but they bounced nicely off of oversold territory a couple days ago. Platinum has held up better than gold and silver and is closer to the top of its trading range than the bottom. Copper continues to trend higher, along with orange juice, while corn, wheat, and coffee are in a sideways trading pattern.

Oilnatgas423

Goldsilv423

Platcopp423

Cornwheat423

Ojcof423

 

===================================================

Claim a gram of FREE GOLD today, plus a special 18-page PDF report;

Exposed! Five Myths of the Gold Market and find out:

·        Who’s been driving this record bull-run in gold?

·        What Happens When Inflation Kicks In?

·        Why most investors are WRONG about gold…

·        When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

====================================================

Even Jack Bauer couldn’t stop ‘The Goldman Conspiracy’

By: Paul Farrell of MarketWatch.com

 

ARROYO GRANDE, Calif. (MarketWatch) — Two mind-numbing fast-paced dramas. Two parallel worlds. One real, one fiction, both deadly. Jack Bauer, mythic hero of “24.” Dying from a deadly bio-pathogen leaked from weapons developed by Starkwood, a rogue mercenary army attacking the presidency, hell-bent on taking over America.

 

The other drama in play: “Hank the Hammer” Paulson, iconic Wall Street hero, a Trojan Horse placed inside Washington by Goldman Sachs as Treasury Secretary in control of America’s $15 trillion economy. Goldman, a modern dynasty with vast financial powers much like those once used by the de’ Medici, Rothschilds and Morgans to control nations.
Both dramas play high-stakes games with financial WMDs that have lethal consequences. Jack compresses thrills, kills and chills into 24 hours. Hank, Goldman and their army of Wall Street mercenaries move with equally blinding speed, heart-pounding action.
Drama? You bet.
Six short months ago Hank led an assault on Congress. The scene parallels one in “24:” Sangala War Lord Juma’s brazen attack inside the White House. But no AK-47s necessary.
The Hammer assaulted Congress with just a two-and-a-half page memo in hand. Like a crack special-ops warrior, he took down the enemy, demanding $750 billion, absolute control, total secrecy, no accountability and emergency powers to act immediately … warning that inaction was not an option, that collapse of America’s banking system was imminent, would bring down the global monetary system, pushing world’s economies into a “Great Depression II.”
Congress surrendered.
Here’s the whole plot:
Scene 1. American government is now run by the ‘Goldman Conspiracy’
Oh, you really think just I’m plotting a television series? Or just paranoid, exaggerating this power grab? You better read “The Usual Suspects,” Matthew Malone’s brilliant article in Portfolio magazine: He “exposed” the “Goldman Sachs ‘conspiracy’ to take over the U.S. financial system.” Read it in this context: America’s financial sector has exploded from 19% of corporate profits in 1986 to 41% today, becoming a magnet for every wannabe billionaire.
They know why Wall Street must control Washington.
Malone focuses on the incestuous “conspiracy” of Goldman alumni in Treasury, Bank of America, Merrill Lynch, AIG, Citigroup, Washington lobbyists and politicians.
Scene 2. Huge conflicts motivating Wall Street’s ‘Trojan Horse’
And just in case you think any emphasis on The Hammer’s conflict of interest was invented purely to increase drama, please remember that he worked at Goldman for three decades after serving under Nixon. He got $38 million his last year as CEO in 2006 before becoming Treasury Secretary.
Then during the market meltdown six months ago the $700 million personal fortune he built at Goldman was threatened by Goldman’s huge $20 billion derivatives exposure at AIG: Suddenly his responsibilities at Treasury merged with a strong self-interest in protecting his personal fortune. AIG was “saved.”
Scene 3. Wall Street’s ‘quiet coup’ also runs world’s banking system
There’s another equally disturbing expose in “The Quiet Coup,” Simon Johnson’s great article in Atlantic magazine. A former chief economist at the International Monetary Fund, Johnson also warns that America’s “financial industry has effectively captured our government” and is “blocking essential reform.”
Worse, he says that unless we break Wall Street’s stranglehold (unlikely in the new Washington) we will be unable “to prevent a true depression,” warning that “we’re running out of time,” echoing many of our predictions of the “Great Depression II” coming soon. See previous Paul B. Farrell.
Scene 4. Wall Street used the meltdown to take over America’s government
Matt Taibbi, author of “The Great Derangement,” captured this drama in a Rolling Stone piece, “The Big Takeover, how Wall Street insiders are using the bailout to stage a revolution.” A must-read:
“As complex as all the finances are, the politics aren’t hard to follow. By creating a crisis that can only be solved by those fluent in a language too complex for ordinary people to understand, the Wall Street crowd has turned the vast majority of Americans into non-participants in their own political future. … in the age of CDS and CBO, most of us are financial illiterates.”
Wall Street “used the crisis to effect a historic, revolutionary change in our political system — transforming a democracy into a two-tiered state, one with plugged-in financial bureaucrats above and clueless customers below.”
Scene 5. How Obama is keeping alive Bush’s ‘disaster capitalism’
Back in 2007 at the start of the meltdown, Hank was misleading us in Fortune: “This is far and away the strongest global economy I’ve seen in my business lifetime.” In the real world, Naomi Klein, author of “The Shock Doctrine: Rise of Disaster Capitalism,” was warning us that “during boom times it’s profitable to preach laissez faire, because an absentee government allows speculative bubbles.”
But “when those bubbles burst, the ideology becomes a hindrance and goes dormant while big government rides to the rescue.” Then, free-market “ideology will come roaring back when the bailouts are done.
The massive debts the public is accumulating to bail out the speculators will then become part of a global budget crisis.” TARP paybacks: Obama has a new “disaster capitalism.”
Scene 6. Wall Street’s CEOs rule like dictators in a banana republic
Seriously, here’s how bad Taibbi sees it: “Paulson and his cronies turned the federal government into one gigantic half-opaque holding company, one whose balance sheet includes the world’s most appallingly large and risky hedge fund, a controlling interest in a dying insurance giant, huge investments in a group of teetering megabanks, and shares here and there in various auto-finance companies, student loans, and other failing business.”
And let’s include $5.5 trillion in Fannie Mae and Freddie Mac. Wall Street’s greed and stupidity resembles the self-destructive reigns of banana republic dictators.
Scene 7. Wall Street makes an un-American bet on ‘disaster capitalism’
Today as you ponder buying some Goldman stock, remember, you’re really betting that “disaster capitalism” is back, strong, tightening its stranglehold on Washington and on the American taxpayers, who will guarantee all Wall Street’s future failures. Yes, this is un-American, but so what?
The “Goldman Conspiracy” is still probably a good short-term buy … if you’re interested in betting on America’s new “democracy of capitalists, by capitalists, and for capitalists,” with “The Conspiracy” leading the joint chiefs of this new mercenary army … and it only took six short months for their “Quiet Coup!”
Scene 8. Banks recycle TARP money, pump earnings, cheat America
Here’s how it worked: The Hammer conned a clueless Congress, then shelled out $350 billion of our taxpayer money (Helicopter Ben Bernanke helped by upping the ante with a couple trillion side-bet), buying toxic debt to save his ol’ Wall Street buddies. They stopped lending and used the dough to doctor their balance sheets.
So no surprise that Goldman, Wells Fargo and J.P. Morgan Chase are now reporting “blockbuster” first-quarter earnings, says the New York Times, while just months ago “many of the nation’s biggest banks were on life support.”
Get it? They screwed taxpayers and borrowers so they can repay TARP with (you guessed it) our recycled TARP money. Now it’s back to business-as-usual, with no restrictions on CEO pay and bonuses … no thank-yous … no admissions of guilt … while some even arrogantly deny that they ever needed TARP money.
Scene 9. Wall Street’s already set the stage for new disaster
Right after the election in November, at the peak of the banking crisis, when Hank, Goldman and the Wall Street mercenary armies were divvying up the $350 billion TARP money, we detailed 30 reasons for the “Great Depression II” likely coming around 2011.
We quoted John Whitehead, former Goldman Sachs chairman, former chairman of the New York Fed, former Reagan deputy secretary of state. He warned America’s problems will take years, burn trillions, result in massive deficits:
“This is a road to disaster,” he said. “I’ve always been a positive person and optimistic, but I don’t see a solution here.” He did see a depression at the end of that road, one you can call the “Great Depression II.”
Scene 10. Obama turned ‘The Goldman Conspiracy’ into a superpower
Do you see the parallels: Jack and Starkwood, Hank and Goldman? Jack’s a great mythic hero. We need to believe a hero will defend the little guy, stand between us and total annihilation. But Jack Bauer’s “dead.” Yes, dead. Jack’s not real. Never was “alive.” Jack’s a fiction, a figment of Main Street America’s vivid imagination, the symbol of “hope” for a populist revolution.
Hope that Jack, Barack or some other new hero will emerge, take power back from Wall Street and return it to the people.
Unfortunately that won’t happen, folks. Yes, on TV Jack will come back from near-death, again. But in real life, Hank, Goldman and Wall Street’s mercenaries are winning the war.
Read and weep Portfolio’s chilling finale: “Obama’s victory and Geithner’s appointment are the completion of Goldman’s meticulously crafted plan to become a superpower. The firm now has the clout to impose its will on the financial markets, and the world.”
GOP or Dems? Conservatives or liberals? It doesn’t matter. We’ll all controlled by “The Conspiracy.” So why not surrender, let them have the power? The truth is, through their lobbyists and surrogates in Washington, they already rule America. Surrender is a mere formality.
Accept reality. Hold them accountable later. After the next crisis.
After the next meltdown of disaster capitalism — if there’s anything left after the “Great Depression II” sweeps like a pandemic across the planet, consuming all economies, for a long time. But for now, Goldman and other banks may well be short-term buys. Just be ready to dump them in the near future … a scenario that will be here sooner than you think. End of Story

===================================================

Claim a gram of FREE GOLD today, plus a special 18-page PDF report;

Exposed! Five Myths of the Gold Market and find out:

·        Who’s been driving this record bull-run in gold?

·        What Happens When Inflation Kicks In?

·        Why most investors are WRONG about gold…

·        When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

====================================================

Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

 

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Emergency Broadcast- Wake Up! It is Almost Too Late!

04 Saturday Apr 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, ANV, Austrian school, AUY, Bailout News, banking crisis, banks, Barack, Barack Hussein Obama, Barack Obama, bear market, Bear Trap, Bildenberger's, Bollinger Bands Saudi Arabia, Brian Tang, bull market, capitalism, CDE, CEF, central banks, CFR, China, Comex, commodities, communism, Conservative, Conservative Resistance, Contrarian, Copper, Council on Foreign Relations, crash, Credit Default, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, Dow Industrials, economic, Economic Recovery, economic trends, economy, EGO, Federal Deficit, federal reserve, Finance, financial, follow the money, follow the news, Forex, fraud, FRG, Fundamental Analysis, futures, futures markets, G-20, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, HL, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, Investing, investments, Jeffrey Nichols, Jim Rogers, Jim Sinclair, John Embry, Jschulmansr, Julian D.W. Phillips, Keith Fitz-Gerald, majors, Make Money Investing, manipulation, Marc Faber, Market Bubble, market crash, Markets, Michael Zielinski, mid-tier, mining companies, mining stocks, monetization, Moving Averages, NAK, New World Order, NGC, NWO, NXG, obama, oil, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, S&P 500, safety, Sean Rakhimov, silver, silver miners, Silver Price Manipulation, SLW, small caps, socialism, sovereign, spot, spot price, stagflation, Stimulus, stock market, SWC, TARP, Technical Analysis, The Fed, TIPS, Today, U.S., U.S. Dollar, volatility, warrants, XAU

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Tags

ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, GTU, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

We are watching history unfold before our very eyes while being skillfully manipulated, distracted, and kept in the dark. This special edition has video’s, articles, and proof that we are being played for suckers and fools. “They” think if the can keep us hypnotized and asleep that they will succeed. What is needed today is a new generation of Paul Revere’s to sound the alarm for Americans. We have been invaded and are losing the war without so much as a whimper! NOW right now is the time to stop being Democrats, Republicans, Libertarians, now is the time to UNITE AS AMERICANS! WE NEED TO KEEP AMERICA FREE AND WE NEED TO START NOW! IT IS ALREADY ALMOST TOO LATE!

***PLEASE*** Do your own research and find out for yourself… Google Search the terms”New World Order”, “TriLateral Commission”, “Council on Foreign Relations”, and “Bildenberger’s” find out how many highly respected people are finally starting to warn you about this sinister and outright grab for world domination! After you finish this post, please pass/send the link to this post onto as many people as you can… before it is too late! -jschulmansr

=================================================

This was sent to me by Peter Grandich

Peter Grandich was the founder and managing member of Grandich Publications which published The Grandich Letter since 1984. His commentary on the mining and metals markets have been read by tens of thousands of subscribers and relied upon by major financial media around the world.

Here is his Latest Blog Post

Grandich Opens The Closet Door Again – Agoracom

By: Peter Grandich

When I came out of the closet, I made it known I would do more than just comment about markets here. I knew some would not like it then and I know some will not like it now.

From time to time during my 25 years in and around the financial industry, I would come across an individual or group who would preach about “A New World Order” or something to that effect. I found most of these people either “out in left field” or had an agenda to sell products and services to go along with their “views”. However in recent times, I’ve come across some very intelligent people and groups who have demonstrated to me they were neither kooks nor salesmen. Their thoughts and opinions were both logical and reasonable.

After watching and listening to what has unfolded at the G-20 this past week and what’s been evolving in Washington and throughout the United States, I no longer wonder is something along the lines of a “New World Order” possible, but rather how far long are we to one?

This is not a kook’s only video.

As an American, I’m extremely concern we’re losing (or already lost) what made this country once great. I believe our President and me see things much differently. I find what this gentleman portrayed in this video to be of keen interest to me and what I believe this country must do before it’s too late.

Finally, I’ve had more discussions with various people about what we can do if we’re truly entering a tribulation or a way of life totally different then our past generations. I tell them I worry too but then I try to remember this and to realize the battle may be near but the outcome has already been determined.

“Jesus said, I have told you these things so that in me you may have peace. In this world you will have trouble. But take heart! I have overcome the world.”    John 16:33

Have a most blessed Holy Week!

Here is the Video…

=============================================

Next Comes From Alex Jones of Prison Planet.com

The Obama Deception HQ Full length version- You Tube

Source: You Tube

=========================

This is From Bloomberg Financial News:

G-20 To Shapes New World Order With Lesser Role For U.S., Markets – Bloomberg.com

By Rich Miller and Simon Kennedy

April 3 (Bloomberg) — Global leaders took their biggest steps yet toward a new world order that’s less U.S.-centric with a more heavily regulated financial industry and a greater role for international institutions and emerging markets.

At the end of a summit in London, policy makers from the Group of 20 yesterday delivered a regulatory blueprint that French President Nicholas Sarkozy said turned the page on the Anglo-Saxon model of free markets by placing stricter limits on hedge funds and other financiers. The leaders also pledged to triple the resources of the International Monetary Fund and to hand China and other developing economies a greater say in the management of the world economy.

“It’s the passing of an era,” said Robert Hormats, vice chairman of Goldman Sachs International, who helped prepare summits for presidents Gerald R. Ford, Jimmy Carter and Ronald Reagan. “The U.S. is becoming less dominant while other nations are gaining influence.”

A lot was at stake. If the leaders had failed to forge a consensus — Sarkozy this week threatened to quit the talks if they didn’t back much tighter regulation — it might have set back the world’s economy and markets just as they’re showing signs of shaking off the worst financial crisis in six decades.

That’s what happened in 1933, when President Franklin D. Roosevelt torpedoed a similar conference in London by rejecting its plan to stabilize currency rates and in the process scotched international efforts to lift the world out of a depression.

More Conciliation

Seeking to avoid a repeat of that historic flop, President Barack Obama junked the at-times go-it-alone approach of his predecessor, George W. Bush, and adopted a more conciliatory stance toward his fellow leaders.

“In a world that is as complex as it is, it is very important for us to be able to forge partnerships as opposed to simply dictating solutions,” Obama told a press conference at the conclusion of the summit.

Stock markets rose in response to the steps taken by the G-20 leaders. The Standard & Poor’s 500 Index climbed 2.9 percent to 834.38. The Dow Jones Industrial Average added 216.48 points, or 2.8 percent, to 7,978.08. Both closed at their highest levels since the second week of February.

In an effort to promote harmony, Obama soft-pedaled earlier U.S. demands that the summit agree on a specific target for fiscal stimulus in the face of opposition from France and Germany. Instead, he settled for a vague pledge that the leaders would do whatever it takes to revive the global economy.

Repudiation of Past

The president also signed on to a communiqué that Nobel Laureate Joseph Stiglitz said repudiated the previous U.S.-led push to free capitalism from the constraints of governments.(See My Post From Yesterday For Actual Article)

“This is a major step forward and a reversal of the ideology of the 1990s, and at a very official level, a rejection of the ideas pushed by the U.S. and others,” said Stiglitz, an economics professor at Columbia University. “It’s a historic moment when the world came together and said we were wrong to push deregulation.”

In bowing to that view, the leaders conceded in a statement that “major failures” in regulation had been “fundamental causes” of the market turmoil they are trying to tackle. To make amends and to try to avoid a repeat of the crisis, they pledged to impose stronger restraints on hedge funds, credit rating companies, risk-taking and executive pay.

“Countries that used to defend deregulation at any cost are recognizing that there needs to be a larger state presence so this crisis never happens again,” said Argentine President Cristina Fernandez de Kirchner.

Financial Stability Board

A new Financial Stability Board will be established to unite regulators and join the IMF in providing early warnings of potential threats. Once the economy recovers, work will begin on new rules aimed at avoiding excessive leverage and forcing banks to put more money aside during good times.

German Chancellor Angela Merkel, who had unsuccessfully sought to convince the U.S. and Britain to sign on to similar steps before the crisis began in mid-2007, hailed the communiqué as a “victory for common sense.”

The U.S. did, though, take the lead in getting the summit to agree on an increase in IMF rescue funds to $750 billion from $250 billion now. Japan, the European Union and China will provide the first $250 billion of the increase, with the balance to come from as yet unidentified countries.

“This will provide the IMF with enough resources to meet the needs of East European nations and also provide back-up funding to a broader set of countries,” said Brad Setser, a former U.S. Treasury official who’s now at the Council on Foreign Relations in New York.

IMF Allocation

The G-20 also agreed to an allocation of $250 billion in Special Drawing Rights, the artificial currency that the IMF uses to settle accounts among its member nations. The move is akin to a central bank such as the Federal Reserve effectively creating money out of thin air, except it’s on a global scale.

The increase in Special Drawing Rights will allow countries to tap IMF money without having to accept changes to economic policies often demanded as a condition of aid. The cash is disbursed in proportion to the money each member-nation pays into the fund. Rich nations will be allowed to divert their allocations to countries in greater need.

The G-20 said they would couple the financing moves with steps to give emerging economic powerhouses such as China, India and Brazil a greater say in how the IMF is run.

Emerging Markets Benefit

Citigroup Inc. economists Don Hanna and Jurgen Michels called the summit agreement “a boon to emerging markets” in a note to clients yesterday.

Mexico said Wednesday it will seek $47 billion from the IMF under the Washington-based lender’s new Flexible Credit Line, which allows some countries to borrow money with no conditions.

Emerging-market stocks, bonds and currencies rallied yesterday on speculation other developing nations will follow Mexico’s lead. Gains in Polish, Czech and Brazilian stocks helped push the MSCI Emerging Markets Index up 5.6 percent to 613.07, the highest since Oct. 15.

In a bid to avoid another mistake of the depression era, G-20 leaders repeated an earlier pledge to avoid trade protectionism and beggar-thy-neighbor policies that could aggravate the decline in the global economy.

The Paris-based Organization for Economic Cooperation and Development predicted this week that global trade will shrink 13 percent this year as loss-ridden banks cut back on credit to exporters and importers.

Trade Finance

To help combat that, the G-20 said they will make at least $250 billion available in the next two years to support the finance of trade through export credit agencies and development banks such as the World Bank.

The summit took place amid speculation among investors that the deepest global recession in six decades may be abating. Data released yesterday showed orders placed with U.S. factories rose in February for the first time in seven months, U.K. house prices unexpectedly gained in March and Chinese manufacturing increased. Still, a report today is forecast to show U.S. unemployment at its highest in a quarter-century.

“If the economy turns more favorable, this meeting will probably be viewed as a milestone,” said C. Fred Bergsten, a former U.S. official and director of the Peterson Institute for International Economics in Washington.

The G-20 members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the U.S., the U.K. and the European Union. Officials from Spain and the Netherlands were also present.

To contact the reporters on this story: Rich Miller in Washington rmiller28@bloomberg.net; Simon Kennedy in Paris at Skennedy4@bloomberg.net

==============================================

G20 ushers in a ‘new world order’- Globe and Mail

BOLD STEPS 8 Leaders shift from U.S. model of freewheeling finance, forming historic accord to regulate risk UNITED FRONT 8 Countries pledge $1-trillion in aid for struggling nations, but economists blast lack of new stimulus

ERIC REGULY AND BRIAN LAGHI

April 3, 2009

LONDON — The leaders of the Group-of-20 countries put on a show of unity yesterday to fight the global recession with pledges of more than $1-trillion (U.S.) in aid to help struggling countries and revive trade.

But their failure to unveil new stimulus spending was criticized as a “disappointment” by economists, who fear the global downturn will only deepen unless governments everywhere open the stimulus spigots even further.

The G20 countries also agreed to rein in the world’s financial system through the creation of international accounting standards, the regulation of debt-ratings agencies and hedge funds, a clampdown on tax havens and controls on executive pay. But the lack of details on these proposals suggests they will not become effective any time soon.

U.S. President Barack Obama, who had been calling for more stimulus spending, nonetheless welcomed the communiqué.

“The steps that have been taken are critical to preventing us sliding into a depression,” Mr. Obama told reporters after the close of the G20 gathering. “They are bolder and more rapid than any international response that we’ve seen to a financial crisis in memory.”

Characterizing the agreement as historic, British Prime Minister Gordon Brown, the summit’s host, said the agreement ushered in a new period of international co-operation while ending the era of the Washington consensus, a term from the late 1980s that has come to be equated with market fundamentalism.

“Today we have reached a new consensus that we take global action together to deal with problems that we face, that we will do what is necessary to restore growth,” he said.

Prime Minister Stephen Harper joined fellow leaders in the praise, saying new regulations will help the market work better. “The declaration is very clear that globalization, that open markets, that liberalized trade remain the essential base of our economic system and will be the basis of any recovery and future economic growth,” he said.

The agreement was the object of last-minute negotiations, and overcame the initial objections of German Chancellor Angela Merkel and French President Nicolas Sarkozy, who at one point threatened to leave the meeting if it did not agree with his position on stricter regulation of the financial world.

Ms. Merkel said she was pleased the group came to a broad agreement after such a short period of time. “We now have been able to rally around a message of unity,” she told a news conference.

Mr. Sarkozy said his alliance with Ms. Merkel worked well.

“We would never have hoped to get so much,” he said.

Yesterday’s agreement calls for the creation of a Financial Stability Board, which is designed to work with the International Monetary Fund to provide early warning of financial risks and the actions needed to reduce them. The agreement says the countries will take action against tax havens by slapping sanctions against offending nations. “The era of banking secrecy is over,” the communiqué said.

The $1-trillion-plus in emergency aid is anchored by a commitment to add $500-billion to the resources of the IMF, taking it to $750-billion, a level that should give it enough firepower to extend bailout loans to the hardest-hit countries. Of this amount, $100-billion will come from the European Union, $100-billion from Japan and $40-billion from China.

Another $250-billion will be given to the IMF to support special drawing rights, the organization’s own “basket” currency that can be used to boost global liquidity. Trade finance will be supported with $250-billion channelled through the World Bank and export agencies, though almost none of that amount has been committed yet. The IMF has also agreed to sell gold reserves to provide as much as $50-billion in aid to the poorest countries.

The G20’s IMF measures were more aggressive than expected and helped lift the world’s markets. Commodities such as oil and metals rose as traders evidently took the view that global growth would revive more quickly than they had expected. News of possible U.S. accounting changes of the mark-to-market rules, used to value assets, helped to trigger a bank rally.

“What is most encouraging for the G20 leaders summit in London today is the building evidence that the Lehman-related collapse in global demand seems to be coming to an end,” Derek Halpenny, the head of currency research at Bank of Tokyo-Mitsubishi UFJ in London said in a report yesterday.

The communiqué also called on countries to resist protectionist measures.

The regulatory changes agreed by the G20 countries are sweeping, but lacked detail about their scope and implementation, whether or not they could be enforced globally or nationally.

Mr. Brown said that hedge funds, whose failure can trigger a domino effect in the financial-services industry, would be subject to greater regulation and oversight. Pay and bonuses will have to adhere to “sustainable” compensation schemes.

“There will be no more rewards for failure,” Mr. Brown said.

The leaders, emboldened by the recent progress in prying open tax havens, said sanctions will be slapped on any sponsor country that refuses to sign international agreements to exchange tax information.

Mr. Brown said another G20 summit will take place late this year – city to be determined – to review the measures unveiled yesterday and at previous summits

==========================================

Finally From Jim Sinclair

More of The Exact Same- JSMinset.com

My Dear Friends,

All that has changed is more of what caused this problem in the first place. You are being lied to yet again.

1. Gold is your lifeline, nothing else. I assure you of this.

2. When reality hits, as it will, it will be too late to seek a lifeline.

3. If you let go of your lifeline you have put more into harm’s way than just an investment or a portfolio item.

4. In the final analysis gold and the dollar are inverse to each other.

5. The dollar is only considered a lifeline when viewed from the intoxicants of spin.

6. Gold is a currency.

7. Gold currency is the monetary unit of last resort. Reality is that we all will require a last resort.

8. The G20 was not an intervention that can stop a downward spiral because it produced more of the stuff that caused the disaster in the first place, monetary inflation. 9. Monetary inflation is what the downward spiral is made of.

10. Be logical.

11. Stop being emotional.

12. Anything you can stare down, you can overcome. Stare down your foolish emotions and adhere to reason.

The following is hot air and fabrication. There is no new world. All that has occurred is the plan to create USD $1 Trillion in new monetary inflation. The G20 was all PR that produced more of what has caused the disaster in the first place, another one trillion in monetary inflation that has no means of being withdrawn ever from the international system.

=========================================================

Claim a gram of FREE GOLD today, plus a special 18-page PDF report;

Exposed! Five Myths of the Gold Market

Find out:

· Who’s been driving this record bull-run in gold?

· What Happens When Inflation Kicks In?

· Why most investors are WRONG about gold…

· When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

========================================================

My Note: Protect Yourself, Help Claim America Back. Do your research on what is really going on try these searches in Google NWO- New World Order, CFR- Council On Foreign Relations, Bildenberger’s. Judge for yourself especially in light of what you watched in the videos. Buy Gold, and then take action to save our country! -jschulmansr

==================================

Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

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The Party Is Over For Stocks

30 Monday Mar 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Contrarian, Copper, Credit Default, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, DGZ, dollar denominated, dollar denominated investments, Doug Casey, economic, Economic Recovery, economic trends, economy, EGO, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, follow the news, Forex, FRG, Fundamental Analysis, futures, futures markets, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, HL, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, Investing, investments, Jeffrey Nichols, Jim Rogers, Jim Sinclair, John Embry, Jschulmansr, Junior Gold Miners, Keith Fitz-Gerald, Latest News, Long Bonds, majors, Make Money Investing, Marc Faber, Market Bubble, market crash, Markets, Michael Zielinski, mid-tier, mining companies, mining stocks, monetization, Moving Averages, NAK, NGC, NXG, oil, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, Short Bonds, silver, silver miners, Silver Price Manipulation, SLW, small caps, sovereign, spot, spot price, stagflation, Stimulus, Stocks, SWC, TARP, Technical Analysis, The Fed, Tier 1, Tier 2, Tier 3, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

≈ Comments Off on The Party Is Over For Stocks

Tags

ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, GTU, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

Looks like the party is over! Major follow thru selling today, the Dow currently down 280 points and below 7500 at 7492. The resistance at 8000 was just to much and I think we have put in the top of this Bear Market rally/correction. As I mentioned before a lot of foolish sheeple are going to be panicking very quickly. I have been telling you to buy Gold and Precious Metals for a long time now and today’s articles will give you some more good reasons you should listen. Silver currently is flashing a Big BUY signal and when everything is said and done, I believe Silver will well outperform Gold on a percentage basis. I am using this opportunity to continue loading up on producers and I’m telling you, (CDE) Couer D’Alene Mines under a buck ($1) is looking mighty good! As always consult your financial advisor, read the prospectus, and do your due diligence before making any investments. Don’t be a “sheeple”. I also do my trend analysis thru INO.com and below is why… Good Investing! – jschulmansr – Follow Me on Twitter and be notified whenever I make a new post!

Subject: Two trending markets revisited and analyzed for you

Last week I watched a video analysis of the S&P and Crude Oil markets. The technical analysis was right on at the time, but those markets have changed quite a bit in the last few days. The S&P had a huge rally and Crude seemed to steady out, so what’s the new analysis? Glad you asked!

Below are two free videos, one on Crude Oil and one on the S&P, that gives us an indepth technical look into these markets. Again the videos are free and very informatitive. Just Click on the Links Below…

          S&P Video Analysis:                                Crude Oil Projections:

Here’s your chance to analyze that stock you have been thinking about adding to your portfolio. Just enter the ticker of any company, name of a commodity, or forex pair and get your complimentary technical analysis. It cost you nothing and and no payment info will ever be requested.

Click Here To Enter Your Symbol/s

 

=========================================================

Claim a gram of FREE GOLD today, plus a special 18-page PDF report; Exposed! Five Myths of the Gold Market and find out:

·        Who’s been driving this record bull-run in gold?

·        What Happens When Inflation Kicks In?

·        Why most investors are WRONG about gold…

·        When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

=========================================================

As History Repeats Itself, Time to Buy Gold and Silver – Seeking Alpha

By: Peter Cooper of Arabian Money.net

 

 History does not repeat but it does rhyme, said Mark Twain. For an excellent

assessment of what a stock market crash can mean for the future we have only to turn to The Great Crash 1929 by Professor JK Galbraith.

It is all there, a complete repeat of the run up to the stock market crash of last autumn, and its consequences – thus far. There was the Florida real estate crash as a prelude to the main act, and then a 50 per cent plunge in the Dow Jones in late 1929, just like the one in 2008.

March rally

March 1930 saw a huge rally in stock prices. March 2009 has just given us the biggest rally since 1974 (a previous market crash year). But hold on a minute, what does JK Galbraith tell us happened next?

In 1930 stocks weakened a little in April and then moved sideways into June when they plunged down again. Then they continued falling month after month for the next two years.

Our governments know this, and it does help explain the rush to push money into the economy by means fair and uncertain. The aim is clearly to break the cycle and avoid the down trend.

But will it be successful? Nobody really knows. Is it worth trying? Yes, but the evidence so far is that the Great Recession is tracking a course that is out-of-control, or rather following a pattern last seen in the 1930s.

Perhaps we should be more optimistic, and think that something more like the 1970s ‘lost decade’ is upon us. 1974 was a terrible year for global stock markets and was followed by stagflation – a mixture of low growth and high inflation.

Inflation

Indeed, inflation is the only way to bail out an economy consumed by debt. In the 1930s debt deflation was allowed to take its disastrous course with public spending cuts and trade barriers making an already deteriorating cycle considerably worse.

However, anybody who has just bought into the stock market rally should really think about selling and staying out for a while. This is a time to park money in gold and silver and even exit cash, although you might care to note that cash and precious metals were the best performing asset class of the 70s, while in the 30s gold was the real star.

 

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Silver is Quietly Flashing a Buy Signal, But Buyer Beware- Seeking Alpha

By: Harold Goodman

Anyone who follows the silver market knows that the fundamentals of silver are incredibly strong, long term. Since most silver is mined as a byproduct of base metal mining, and base metal prices are currently depressed by the global recession, inventories of base metals are high, and silver supply is shrinking. Many less profitable mines are closing down. Silver recently went into backwardation, which could indicate delivery problems are imminent in the physical silver market.

The US government currently holds no silver bullion at all, down from five billion ounces immediately after WWII. Above ground silver supplies are currently estimated to be one billion ounces, compared to five billion ounces of gold. This includes silver in tableware, jewelry, and other sources that will never be available on the open market.

For the purposes of this analysis, I will use SLV, the silver ETF, because it is convenient and easy to chart, but keep in mind, this is paper silver, not bullion, and its investment characteristics are completely different. It is supposed to be backed by silver bullion, but if you read the fine print, it may also hold futures, cash, and is allocated to custodians and sub-custodians which cannot be audited. It is designed to track the spot price of silver, but when the spot price of silver falls significantly below the mean, you will find that physical silver dealers will increase their premium over spot rather than drop the price. Holders of SLV cannot demand delivery of the underlying physical silver bullion bars.

On August 25th, 2008 the 50 day moving average of SLV crossed and fell below the 200 day moving average. This is know by technical analysts as the “death cross” and signifies a coming fall in price. SLV closed that day at $13.33


On October 27th, the price of SLV closed at $8.85 during the panic selling of autumn 2008, a 33.6% drop in two months.

Last Friday, March 27th, 2009, for the first time since August 25th, the 50 day moving average of SLV crossed back above the 200 day MA, which could signal a coming runup in price. SLV closed at $13.15


I don’t know what term the technical analysts use for that, so I will call it the “life cross” until someone tells me the correct term.

If SLV’s 50 day MA stays above the 200 day MA, rather than bouncing off it, this is an extremely bullish sign for SLV, and astute investors should be keeping a close eye on it for the next week. But here’s the rub.

Silver is the most highly manipulated market in existence, bar none, and the price of silver has been suppressed for many years. Gold is second to silver. The reason that silver is first apparently is that it is a much smaller market than gold, and can be manipulated using a much smaller number of silver futures contracts. Gold prices can be suppressed both by shorting gold futures, and by actual bullion sales by central banks, but these sales are becoming fewer and smaller as central bank gold reserves are reportedly running low, and even those nations with ample supplies of bullion won’t be willing to part with it at the suppressed price, now that governments worldwide are printing money like it’s going out of style.

The best body of work on silver manipulation by far is the writings of Ted Butler, available here.

Check out his articles on February 8, 2009 and March 16, 2009.

Short term traders like to follow the 12 day EMA and 26 day EMA.

On July 29th, 2008 the 12 day EMA of SLV crossed below the 26 day EMA, signaling a coming drop in price. SLV closed that day at $17.19 Three months later, SLV hit its bottom of $8.85 on October 27th , a drop of 48.4% in three months.

On December 12th, 2008 the 12 day EMA of SLV crossed back above the 26 day EMA, signaling a coming runup in price, and has been above it ever since. SLV closed that day at $10.14

On February 23rd, 2009 SLV peaked out at $14.34, an increase of 41.4% in 2 ½ months.

On March 17th, 2009 the 12 day EMA of SLV bounced off the 26 day EMA, and has remained above it ever since, a bullish sign. SLV closed that day at $12.60, and its most recent close on March 27th was $13.15

If the 12 day EMA can stay above the 26 day EMA, look out above!

The following chart shows the long and short positions of various commodities on the Comex as reported by the CFTC for the week of March 16, 2009. Thanks to Mark J Lundeen for the chart. It shows that the net long/short position in silver is 100% short, compared to gold at 63%. I would consider this as prima facie evidence that the CFTC is not doing their job in preventing manipulation of the commercial silver market.

=========================================================

 

Concentrated Shorts Proven To Supress Gold and Silver – GATA

Source: GATA.org – Gold Anti-Trust Action Committee

Dear Friend of GATA and Gold (and Silver):

GATA Board of Directors member Adrian Douglas, editor of the Market Force Analysis letter (http://www.marketforceanalysis.com/), has combined data from the U.S. Commodity Futures Trading Commission and the Office of the Comptroller of the Currency to show that the suppression of the prices of gold and silver in the last several years correlates exactly with the growing concentration of the short positions held by two U.S. banks, JPMorgan Chase and HSBC.

Short of the official admissions of the gold price suppression scheme collected and published by GATA over the years, Douglas’ report is probably the best proof yet, and certainly the most detailed. Douglas’ report is titled “Pirates of the COMEX” and you can find it in PDF format at GATA’s Internet site here:

http://www.gata.org/files/PIRATES-OF-THE-COMEX.pdf

GATA’s supporters may be wearying of our many similar requests, but only persistence pays off, so we ask you to print copies of Douglas’ report and send them — by regular mail, not e-mail, which is ignored — to your U.S. senators and representatives with a covering letter requesting an explanation as to why nothing is being done to stop this market manipulation. For our friends outside the United States, please send copies with similar letters to your own national legislators.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and

you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16

 

 

=========================================================My note: As my friend Trader Dan says-

“Nothing will unnerve the paper gold shorts more quickly and do more to undercut their confidence than to strip them of the real metal and force them to come up with more hard gold bullion to make good on deliveries. “Stand and Deliver or Go Home” should be the rallying cry of the gold longs to the paper gold shorts.” –Trader Dan Norcini

I think it’s time for a “short squeeze” and take back some of the money the “pirates” have stolen

=========================================================

That’s it for now-Have a Great Monday!- Good Investing- jschulmansr

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Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

 

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Scammed Again By Uncle Sam?

18 Wednesday Mar 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, Bailout News, banking crisis, banks, bear market, central banks, China, Copper, Currencies, currency, Currency and Currencies, depression, dollar denominated investments, economic, Economic Recovery, economic trends, economy, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, follow the news, Forex, Fundamental Analysis, futures, futures markets, gata, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, hard assets, How To Invest, How To Make Money, hyper-inflation, IMF, India, inflation, Investing, investments, Japan, Jschulmansr, Latest News, Long Bonds, majors, Make Money Investing, manipulation, Market Bubble, market crash, Markets, mid-tier, mining companies, mining stocks, monetization, oil, palladium, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, recession, Saudi Arabia, Short Bonds, silver, silver miners, Silver Price Manipulation, spot, spot price, stagflation, Stimulus, Stocks, TARP, Tier 1, Tier 2, Tier 3, TIPS, Today, U.S., U.S. Dollar

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ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, GTU, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Jschulmansr, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

Today Gold dropped $27.70 down to support at the $885 – $890 levels. We need to ask ourselves why? I would like to propose that we are absolutely being “Scammed by Uncle Sam!”. Let me explain… Again today Gold Lease Rates (1 month) are negative. “So what’s the  big deal about that?” you are asking. The big deal is this, when the lease rate is negative it means that someone will actually pay you a fee in addition to giving a Gold loan. Now you or I or anybody with a sane mind is not going to make a loan to you for a fee (they have to pay), to borrow Gold from them. This doesn’t even count the risk of never being repaid and losing the Gold! However, (and you can read more detail in today’s first article); this provides a way for someone to supress Gold prices if they wanted to, and you guessed who – “Scammed Again By Uncle Sam”. While the first article today explains “the how”, I am going to venture the “why”. Right now if you pay attention to what is going on, the U.S. and the Fed desperately need to appease some large holders of our debt and dollars by making a way for them to convert their dollar holdings into Gold. They also realize that their current (US) monetary policies are going to force Precious metals prices (especially Gold) much higher than today’s $1000 level while at the same time deteriorating the value of the U.S. dollar. By supressing the price of Gold temporarily the Fed and Treasury will benefit as follows. First as the foreign holders sell off their Treasuries and Bonds this creates a demand for U.S. Dollars to fulfill the transactions. This in turn brings those Dollars back into our economy helping to create more liquidity. Now depending on the velocity of money, that can be in itself inflationary. However with the velocity of money being dependent on Capital Investment, what are we currently seeing? Right now there is no real demand for new goods and services, which means that there is no real incentive to invest in New Factories, Expanding current production levels, or even opening new businesses. So then what happens? The holders instead of sitting on their dollars look for safe places to park those dollars until the economy turns around again. Where do they park the money, banks have proven to be risky?, the stock market? even riskier still, so they park their money in a “safe haven”, buying up Treasuries and Bonds. This helps to offest the selling pressure on Treasuries caused from the original U.S. Debt holder’s sales, and it also creates further demand for U.S. Dollars. With the unprecendented spending currently going on by Mr. Obama and cohorts, the Fed and the Treasury needs to create an increased demand for all of the new Debt Issuances coming into the market. ( They are also creating further false demand buy buying up their own new debt  (300 Billion purchase just announced today). In my mind these purchase in the long term will also create more inflation. So currently the U.S. government has every reason to keep trying to artificially depress the Gold Prices. Sooner or later however their Gold price manipulation will explode in their faces as already seen in a smaller degree,  the demand for Gold is snatching up all of the physical gold being dumped. That is why we will bounce off of these price levels for the fourth time. When it breaks and when inflation (already here- currently running 8% to 15%) is officially acknowledged,watch out Gold will shoot up like the latest Space shuttle launch! Use this limited time frame to keep adding to and accumulating your long positions in Precious Metals- Good Investing! – jschulmansr

ps- For complete details and Information on how Gold Prices are being manipulated and the Silver market also- go to GATA.org.

pps-****NEWS FLASH****

Gold is now up $26.60 New York Spot at $942.50 after Fed Announcement of Leaving Interest Rates Unchanged!

 =========================================================

Claim a gram of FREE GOLD today, plus a special 18-page PDF report; Exposed! Five Myths of the Gold Market and find out:

·        Who’s been driving this record bull-run in gold?

·        What Happens When Inflation Kicks In?

·        Why most investors are WRONG about gold…

·        When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

=========================================================

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=========================================================

 

 

 Gold Price Manipulation More Blatant- Numismaster.com

By: Patrick A. Heller of Numismater.com

On Friday, March 6, gold lease rates turned negative for the day. What that means is that anyone who wanted to lease gold would actually be paid a fee in addition to getting a free gold loan.
No sane person would choose to lose money loaning physical gold, in addition to the risk of never getting the gold back from the other party. However, if someone (such as the U.S. government) wanted to suppress the price of gold, this is one tactic to try to accomplish that purpose.
I can come to no other conclusion than that a large quantity of physical gold surreptitiously appeared on the market on March 6 with the sole purpose to drive down the price of gold. The quantities were large enough that they almost certainly could not come from private parties. With most of the world’s central banks now being net buyers of gold reserves, they would not be the source of this gold. By process of elimination, the suspicion falls upon the U.S. government as the ultimate party responsible for this blatant action to manipulate the price of gold.

Of course, the U.S. government would not want to be identified as the cause of this leasing anomaly. Instead, such manipulation was almost certainly conducted by multiple trading partners of the U.S. government.

This sledge hammer tactic worked at driving the price of gold further away from the $1,000 level – at least temporarily. Last week, spokesmen for a number of troubled U.S. companies were suddenly issuing statements about a return to profitability (such as Citigroup and JPMorgan Chase) or not needing further government bailouts (such as General Motors). Stock values climbed as gold’s price retreated.

But (and there was always a but), these massive efforts to suppress the price of gold seem to be running out of steam. First off, these “positive statements” had serious qualifiers such as the chairman of Citigroup claiming that, ignoring extraordinary items like bad loans, the bank earned an operating income in the first two months of 2009.

Then insurance company AIG bowed to pressure and revealed that a huge portion of the $150+ billion in bailout funds it had received had really been passed along as bailout money to other companies (including Citigroup and JPMorgan Chase). In fact, almost all of this money was redirected to the U.S. government’s trading partners who probably have been complicit in the manipulation of the gold price.

Once the public learned that such companies have received more federal government bailout money that previously revealed, the stock market rally stalled. The price of gold started to recover. Unless the U.S. government can come up with another tactic quickly, I expect the price of gold to generally rise over time.

In the meantime, demand for physical gold has taken off again. The U.S. Mint is so far behind at meeting demand for bullion gold and silver American Eagle issues that it last week announced an indefinite suspension of plans to strike 2009-dated proof and uncirculated versions for collectors. Even further, the U.S. Mint also announced that it would not even accept orders from primary distributors for any gold or silver Eagles this week.

On the wholesale market, supplies of gold and silver American Eagles quickly disappeared. The premiums of these coins shot upward. Some retailers now have to decline orders as they don’t know when they might be able to fill them or what premiums they will have to pay to acquire merchandise. My earlier prediction that by the end of April it would become almost impossible to find any physical gold or silver bullion-priced items for reasonable delivery is starting to come true.

At the American Numismatic Association’s National Money Show in Portland, Ore., this past weekend, demand for U.S. gold $10s and $20s was still solid. With some such collector coins now trading at all-time high prices, however, some dealers are advising their customers to consider selling or swapping for gold bullion. As a consequence, I think most of the surge in prices has already occurred. It might be a good time to take a profit.

 

 

 

=========================================================

My Note: Very Interesting Advice! “take profit on collector coins and buy bullion”-jschulmansr

=========================================================

What’s Another $1.5 Trillion? – Seeking Alpha

By: Tim Iacono of Iacono Research

The Federal Reserve announced today that they will join the central banks of England and Switzerland, printing money out of thin air to buy long-term government debt so as to keep interest rates low and boost lending in their ongoing attempt to revive an economy that is faltering badly due to an orgy of credit and debt a few years ago.
Apparently the gold market and currency markets have heard the news (the chart to the right will be updated as needed over the next hour or so – update #1 from $925 to $932 already complete).
The printing presses will be working ’round the clock to fund purchases of up to $300 billion in long-term Treasuries over the next six months which, in combination with an increase in purchases of mortgage backed securities and agency debt also announced today (an additional $850 billion total), should see the Fed’s balance sheet swell to once unthinkable levels.

Lest anyone think that any of this is getting a bit out of control, the central bank also provided assuring words that they will keep an eye on the “size and composition” of their balance sheet in light of economic developments.

In what appeared to be just an afterthought, relegated to the third paragraph after occupying the top spot for years, the Fed also announced that short-term interest rates will be left at the freakishly low level of between zero and 0.25 percent and that they won’t be going up anytime soon.

And if this doesn’t work, we might just see the Fed’s balance sheet hit that $10 trillion level that someone mentioned the other day.

 

 

=========================================================

“Nothing will unnerve the paper gold shorts more quickly and do more to undercut their confidence than to strip them of the real metal and force them to come up with more hard gold bullion to make good on deliveries. “Stand and Deliver or Go Home” should be the rallying cry of the gold longs to the paper gold shorts.” –Trader Dan Norcini
 
 

 

=========================================================

My note: Only one answer to being scammed buy more! Please take advantage of the price now, they may try to bump it down one more time, but we are going back and testing all time highs $1050 level, if a “short squeeze” develops then $1250. Jump aboard now! -Good Investing – jschulmansr

=========================================================
Claim a gram of FREE GOLD today, plus a special 18-page PDF report; Exposed! Five Myths of the Gold Market and find out:

·        Who’s been driving this record bull-run in gold?

·        What Happens When Inflation Kicks In?

·        Why most investors are WRONG about gold…

·        When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

=========================================================

A new site that is in pre-launch state that will become a virtual world – chat, shop, play, videos, etc. Anyways they are giving free shares (that should become actual company shares) to anyone who signs up and more shares if you refer people. To Sign up (Free) and receive your shares click here.

 

========================================================= 

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Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

 

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They’re At it Again? – Who’s Going to Win?

10 Tuesday Mar 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, bear market, bull market, central banks, China, Comex, commodities, Contrarian, Copper, Credit Default, Currencies, currency, Currency and Currencies, DGP, dollar denominated, dollar denominated investments, economic, Economic Recovery, economic trends, economy, Finance, financial, follow the news, Forex, Fundamental Analysis, futures, futures markets, gata, GDX, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, hard assets, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, Investing, investments, Jschulmansr, Junior Gold Miners, Latest News, majors, Make Money Investing, manipulation, Market Bubble, Markets, mid-tier, mining companies, mining stocks, oil, palladium, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, silver, silver miners, Silver Price Manipulation, small caps, spot, spot price, stagflation, Stimulus, Stocks, Technical Analysis, Tier 1, Tier 2, Tier 3, Today, U.S., U.S. Dollar, XAU

≈ Comments Off on They’re At it Again? – Who’s Going to Win?

Tags

ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

Sorry, I missed everyone yesterday, it was a very interesting day making this one wonder if we are not seeing more hidden central bank selling in a desperate measure to hold Gold Prices down. Sooner or later the shorts will have to fill which I believe will happen somewhere around the $1050 – $1100 range giving a big pump up. Meanwhile today’s action, we are once again seeing continued downward pressure with Gold holding at the $890 to $900 range. Personally, I think we will hold here at the $880 to $900 level, build strength after the Gold coming on the market is absorbed. If we don’t hold here then $850 is the next very strong support level. We’re having a nice little upward correction in the stock markets and this may be the 20% retracement rally  traders have been looking for. Mark my words we will soon here remarks like the “bottom is in place for stocks” and “now” is the time to get in at these low levels. After they sucker everyone in then we will see the Stock markets continue in their downward channel. In the meantime take advantage of this to load up on your Gold. Especially since we’ll hear the “double top” formation is in place comments and everyone will be giving up on Gold and Silver. I personally think we are forming a new pennant formation like the one that was formed around the $700- $750 level which then took off to $1000+. Based on that this formation should be the launch pad up to the $1250 level. I am aggressively buying  Precious Metals Miners with current or about to come on line production, accumulating some more physical holdings and hanging tight. When I have confirmation I will be re-entering DGP for another ride to at least $1000. I will post when I enter that trade and if you are following me on Twitter you’ll be the first to know. Good Investing! -jschulmansr

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============================================================
Claim a gram of FREE GOLD today, plus a special 18-page PDF report; Exposed! Five Myths of the Gold Market and find out:

·        What’s been driving this record bull-run in gold?

·        Why most investors are WRONG about gold 

·          What Happens When Inflation Kicks In?

·          How to buy gold — at low cost with no hassle

Get this in-depth report now, plus a gram of free gold, at BullionVault here…

============================================================

 

Here you go- Bottom Calling For the Stock Market already!Barron’s Calls a Bottom – Seeking AlphaSure, stocks could slide much further — but they probably won’t. By most measures, they are downright cheap.

 

 

========================================== 

 

By: Eli Hoffman Senior Editor Seeking Alpha

Barron’s cover story this weekend basically calls a bottom to the bear, though not in quite so many words.

 After blaming Obama for much of stock market woes (“The lousy economy is the main factor, but stocks haven’t been helped by Obama administration proposals … It doesn’t help that the Street is calling this an “Obama bear market” and that some investors are looking to “Obama-proof” their portfolios…), Barron’s concedes that the president did get at least one thing right: stocks are cheap for investors with patience.

Barron’s says its research bears that out. Here’s why:

  1. Stocks are cheap relative to P/E – a Citigroup economist’s 2009 earnings estimate for S&P 500 components puts their collective P/E ratio at more than 13, which is where a bunch of bear markets bottomed – except 1974, ’82 and ’87 when P/E went as low as 8.5. If we get down to 10, S&P could fall another 25% to 500 and DJIA around 5,000. But that probably won’t happen, because in previous downturns Treasury yields were much higher, and because another Citigroup analyst says he’s seeing signs of panic.
  2. Stocks are cheap relative to GDP – at 60% of the $14T GDP, stocks are their cheapest relative to economic output since the early ’90s. But they’re still well higher than the lows of about 30-35% seen in the ’70s and early ’80s. Stocks are also cheap relative to book value – about 1.3 down from a high of 5 during the dot-com bubble.
  3. Stocks are cheap relative to gold – S&P 500 is now worth about 75% of the price of an ounce, vs. a peak of more than 5x in 2000. Over the past 40 years, the average stocks-to-gold ratio has been 1.6.

There’s also a lot of cash on the sidelines, Barron’s says, noting money-market funds now hold $4T – almost half of the market cap of U.S. stocks, and double the amount in money-market funds two years ago.

Barron’s expects stocks in defensive industries like drugs (PFE, LLY, MRK, BMY, SGP) and consumer goods (HNZ, KFT, PG, KO, GIS) to benefit from a return of confidence.

For those prone to bottom calling, or not, here’s some more food for thought:

  • Babak notes pessimism, as measured by the American Association of Individual Investors’ weekly survey, is at record highs. A contrarian buy signal.
  • Todd Sullivan says that a couple weeks of positive economic data could cause extreme pessimism to make a rapid about-face.
  • Jason Schwartz thinks we’re in another bubble – one of uncertainty. Forget about buy-and-hold, he says – but short term gains on oversold stocks could be massive.
  • Meanwhile Mike Stathis, while noting stocks are very close to “fair value,” for what that’s worth, doesn’t mean the market won’t go lower. In fact, it probably will.

==================================

Here’s a nice piece with some good info about one of my personal longs (ABX).

Gold Mining or Gold Bullion Stocks for 2009? Seeking Alpha

By: Preston Poulter of PrestonPoulter.com

With Obama’s outrageous stimulus plans where the federal government is going to give out billions of dollars of handouts to the demand side of the economy, it’s no wonder gold is gaining ground while stocks have been falling. However, the question remains when is it time to buy? The answer is now. Gold has been consistently in an uptrend since October of last year. This is shown in the chart (click to enlarge) of a major gold ETF (GLD) [GLD: 90.57, -1.72 (-1.86%)] below. As you can see, gold is making a short short term pullback which signals a time to buy. With more talk of spending, including a world wide stimulus package, there is only further pressure on leading countries, currencies such as the U.S. dollar. These inflationary pressures may push gold to break the 2008 highs of around $1056.

But I’m not content just to park my money in physical gold and leave it at that. The trader in me wants to make a leveraged play to make the most off of gold’s bright future. Gold mining shares would seem an excellent play then. Not only do you get exposure to the gold market, but you get the benefits of stock ownership. In the past, whenever I would introduce the idea of owning gold as a form of investment, people would laugh my suggestion off because they just couldn’t imagine how anything would be better than owning “stocks for the long run.” Of course, they aren’t saying that anymore.

Gold mining shares are a nice compromise in terms of investment philosophy. If the American dollar does fall from grace as we goldbugs suggest, then owning shares of a gold mining company will be a tremendous boon. If the dollar continues to stubbornly hang on, and we somehow manage to resume normal economic growth, then I still own equities and should get the traditional benefits of equity appreciation.

The theory of owning gold mining equities is pretty easy, but the reality can be rather treacherous. Should you chose an established company with a lot of reserves or a junior company that mainly has a lot of promising prospects? One is more dependable and the other has the potential to be far more rewarding. It’s a similar discussion to blue chip versus tech stock debate we saw towards the end of last century.

For myself, I wanted an established company. Junior mining companies need a healthy amount of credit to develop their mining operations, and that wasn’t a chance I was prepared to take given the credit collapse of last year. That narrowed my focus down to just a couple of companies: Newmont Mining (NEM) and Barrick Gold (ABX). I chose Barrick because it was the largest mining operation in the world and because, at the time, it was trading at a lower PE ratio than Newmont. As of this writing, Newmont has held up better over the last twelve months as shown in the graph below.

The relative stock performance of the two companies.
The relative stock performance of the two companies

Really the two companies were performing in tandem until the last month or so. Then Barrick shares had a rather sudden loss of value. Part of this loss of value is probably related to the loss Barrick announced for its fourth quarter. The company was able to sell its gold at a good profit margin, despite the temporary fourth quarter fall in the price of gold, but the company also wrote off a large portion of the value of an oil company it had acquired in the prior year. Like so many decisions that turn out wrongly, it seemed like a good idea at the time. Oil is a significant cost in the mining of gold, so it would make sense to buy an oil company in a rising oil market as a hedge against an increase in the cost of mining. Oil’s subsequent fall caught even Warren Buffett by surprise.

Having to write off the value of an oil company due to a collapse in the oil market seems like a one time event. So let’s instead compare Barrick and Newmont on their forward PE ratios, rather than the past twelve months. Barrick closed yesterday trading at a forward Price-to-Earnings (PE) ratio of 15.71 compared to Newmont’s 16.43, which shows that you’re getting a discount for Barrick’s earnings over Newmont’s. The dividend ratio is even better: Barrick yields 1.4% compared to Newmont’s 1.0%. That’s 40% more money in your pocket for owning Barrick. Looking at these figures suggests Barrick is clearly the better company to own at these prices.

Going forward, it’s only a matter of time before the inflationary policies of the world’s central banks start forcing the gold price higher. However, Barrick will not perform well this year if we don’t see a return in the price of copper. There’s a significant amount of copper tied up in the gold ore that Barrick mines and in the past Barrick has been able to refine and sell it at a nice profit to held reduce the cost of its gold operations. For the year 2006-2008, Barrick was able to sell its copper at over $3 a pound and make a profit of over 50% on the sale. Yesterday copper closed around $1.65. If copper stays at that price the entire year, Barrick’s results will suffer. I’ve run a few simulations in a spreadsheet and here’s the numbers I get:

  • If gold averages the year at $950 an ounce and copper stays at $1.65 a pound, Barrick will earn $.94 a share.
  • If gold averages $1050 an ounce and copper stays at $1.65 a pound, Barrick will earn $1.78 a share.
  • If gold averages $950 an ounce and copper returns to $3 a pound, Barrick will earn $1.51 a share.

As you can see, the return of copper to its former levels is going to be just as significant to Barrick’s earnings as gold appreciating in value.

Since analysts estimate a 2009 EPS of $1.85, Barrick could suffer a significant down year if we don’t start to see copper return soon.

Looking beyond a year, I believe Barrick is positioned well. It is set to make money from an appreciation in copper, oil, or gold. That makes it a great place to be as we feel the effects of inflation, but in the short term gold bullion may represent a better investment.

Disclosure: Barrick common stock represents a significant portion of my investment portfolio.-Preston Poulter

=====================================

Gold Continues to Gain Ground – Seeking Alpha

Source: Bullish Bankers  – Justin DiPietro


Given the massive amount of money being pumped into the global economic system, higher prices down the road are a given. It’s possible that prices may fall in the short term, but no currency can withstand a determined onslaught by its own central bank and national government for long. I consider gold a no brainer in this environment. It’s a store of value that does well both in inflationary times and, as we saw last year, in deflationary times.

gld

-Justin DiPietro

Disclaimer: None.

==================================

My Note: See the nice little wedge we are forming in the above chart, a little patience and then bang! $1250 here we come! – jschulmansr

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Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr
 

 

 

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A Challenge! What is Gold going To Do?

27 Friday Feb 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, Bailout News, banking crisis, banks, Barack Obama, Brad Zigler, bull market, capitalism, China, Comex, commodities, Contrarian, Copper, Credit Default, Currencies, currency, Currency and Currencies, depression, DGP, DGZ, economic, Economic Recovery, economic trends, economy, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, Forex, Fundamental Analysis, futures, futures markets, gata, GDX, GLD, gold, Gold Bubble, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, hard assets, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, Investing, investments, Junior Gold Miners, Latest News, majors, Make Money Investing, manipulation, Market Bubble, market crash, Markets, mid-tier, mining companies, mining stocks, monetization, oil, palladium, physical gold, platinum, platinum miners, precious, precious metals, price, price manipulation, prices, producers, production, recession, risk, run on banks, silver, silver miners, Silver Price Manipulation, small caps, spot, spot price, stagflation, Stimulus, Stocks, TARP, Technical Analysis, The Fed, Tier 1, Tier 2, Tier 3, Today, U.S., U.S. Dollar, warrants, XAU

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ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, DGZ, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

This morning  I posted a challenge to Brad Zigler of Hard Assets Investor, I asked him point blank, “Pontificating aside, where do you stand in relation to Gold? Both short term and long term? No charts or arguments just a simple statement I believe Gold will…”. This was in relation to the 1st article below and comments (included); our answers back and forth (highlighted).

Today Gold is trading currently up $4.40 at $947 (April Contract). It has been as high as $17 up and as low as $946 currently trading at the lower end. We have strong support at the $930 level and if we close above $950 today then I believe next week we’ll see a return to test the $1000 level again.

The 2nd article is from GATA and government intervention/supression of Gold prices. Read my comment after Brad’s article for my short to long term call for Gold. I am getting ready to re-enter my DGP trade again and will be watching the market closely. If we do break resistance here then I will actually go short (buy DGZ) on the Gold market for a very short term trade as I think (if the resistance is broken) then we will go back and test support at $925 and then $880-$890 level. If we close above the $955 level then I will go long for the test of the $1000 level then the next test at $1033 all time high.

Disclosure: I am long in a couple of Precious Metals Mutual Funds, long Gold and Silver Bullion, and many of the Tier 1, 2, and junior mining stocks. Otherwise,as you can see I use DGP or DGZ for the short term moves in gold. 

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Gold’s Devilish Advocate – Seeking Alpha

By: Brad Zigler of Hard Assets Investor.com

In certain circles I’m known as a curmudgeon. Yeah, that’s right. Crusty, irascible and cantankerous. Hard to believe, isn’t it?
The funny thing is that people on both sides of the hard assets spectrum share that point of view. To so-called gold bugs, my under-exuberance for wildly optimist gold forecasts is anathema. Monetarists, on the other hand, grouse about my metering of the dollar’s value against bullion.
No matter what side you line up on, you can’t have ignored the $300 rally in gold prices since late October. For the February COMEX contract, that amounts to a 46% increase; pretty much a replay of the run-up that ended last March. That should prompt you to wonder about the odds of gold topping out again.
No doubt, the answer to that depends upon your gold Weltanschauung. But let’s play devil’s advocate for the moment. What factors argue for a gold sell-off? Or, at least, for keeping a lid on the metal’s ascendance?
The Dollar/Gold Dyad
This year, the dollar’s provided as much refuge for worried investors as gold. Ordinarily, there’s an inverse relationship between gold and the dollar. In the current global disinflationary environment, though, the greenback is proving to be the best nonmetallic haven for global capital. Rising dollar interest rates will enhance the buck’s attractiveness. At least until a cyclical reflation of the currency. Yes, there will be a lot of dollars out there. But right now, there are a lot of representations of the dollar-bills, notes and bonds-awaiting redemption.
The dollar’s prior inflationary pace was braked well before the price of gold peaked last March. We’ve yet to see the leading edge of reflation.

U.S. Monetary Inflation And Gold

U.S. Monetary Inflation And Gold

Dollar interest rates bottomed just before the Obama inauguration and have steadily gained ground since then. Rising rates are like lipstick: A judicious dose can enhance the beauty of a currency; too much, and it looks tawdry. There’s nothing tawdry, though, about the 18-point rise in the dollar LIBOR over the last month. It’s sustainable and makes the buck even more attractive.

Dollar Interest And Gold Lease Rates

Dollar Interest And Gold Lease Rates

Gold Liquidity

The gold lease market belies the shortage scenario played up by many market pundits. Gold lease rates have been falling precipitously as the contango reflected in forward rates has been rising. Contango exists when supplies are plentiful. The current oil market provides testimony of that. The gold market – at least the commercial gold market – gives every indication of being well-supplied.

Overbought Market

Relative strength in gold futures crossed into overbought territory when the spot contract topped $1,000 last week. The peak, if not exceeded, would represent an interim double top and confirmation that the March 2008 high is likely to hold.

COMEX Futures Open Interest

COMEX Futures Open Interest

Speculative Aggressiveness

Commercial hedgers are still driving gold futures pricing. Aggressiveness on the part of large speculative buyers has actually waned as prices moved higher. Over the past month, net long speculative positions rose 34% while commercial net shorts picked up 40%.

Essential Question

Think back to the events surrounding gold’s March 2008 peak and ask yourself this: “Have economic conditions improved or worsened since then?” I think it’s fair to say our financial troubles have deepened. If that’s true, and if gold is a safe haven, why hasn’t the metal made new highs?

This is by no means an exhaustive analysis, but it does raise essential questions that gold bulls should be prepared to address when making their case for higher prices.

Don’t expect to hear the answers in the late-night infomercials hawking gold, though.

================================

Comments:

 

 JudeJin

 

 

 

    • Comments
    • one cannot decipher a puzzle without having all the pieces.i think you lack a lot of other data to put together a whole picture of where gold stands.there are quite a few people in the world who have collected the all pieces of the puzzle and deciphered the truth behind gold! you are obviously not one of them.i think either you purposely hand-pick the set of charts with very limited time frame to drive your point home or ……    

       

       

    Feb 27 06:10 AM
     
    • Brad Zigler
    • 60 Comments
    • Website
    Look at the article’s premise: to play devil’s advocate against a widely held bullish sentiment.
    Feb 27 07:13 AM |Report abuse| Link | Reply
    +30

    You’re offering a complaint, not a refutation. What, specifically, is wrong with the arguments advanced?

    On Feb 27 06:10 AM JudeJin wrote:

    > one cannot decipher a puzzle without having all the pieces.
    >
    > i think you lack a lot of other data to put together a whole picture
    > of where gold stands.
    >
    > there are quite a few people in the world who have collected the
    > all pieces of the puzzle and deciphered the truth behind gold! you
    > are obviously not one of them.
    >
    > i think either you purposely hand-pick the set of charts with very
    > limited time frame to drive your point home or ……

  •  
    • doubleguns
    • 123 Comments
    JudeJin—– I would be interested (very interested) to hear all of the pieces if you would please. If you are one of those people please enlighten us.
  •  
    • huangjin
    • 310 Comments
    I would add the deflation/economic contraction argument. People have less money to spend and they will spend less on everything, including gold.
  •  
    • manya05
    • 11 Comments
    I do not have all the pieces of the puzzle, and I am no expert either, but a few things catch my eye and beg an explanation (or maybe they are the explanation). I see all fiat currencies devaluing, all at the same time more or less, and all for different reasons. For instance, the dollar and euro are devaluing as governments print money like there is no tomorrow, while the yuan and yen devalue to keep the economies from drowning as exports shut down. So everyone is sinking to the bottom. You would expect in that scenario that “something” would retain value. I see why gold bugs may think it is gold (finite amount in existence, finite production, and no use whatsoever other than financial instrument). And that is the clincher, why would something with no other use keep value? how about things that are useful and very much needed? shouldn’t those be appreciating? water, food, energy…why are they not? Sometimes I feel we are all watching the wrong movie and trying to interpret what is happening through the wrong lens…I think this is a systemic readjustment as the value/remuneration among nations in a globalized economy takes its course…but that is the subject for another post…..
  •  
    • craigdude
    • 6 Comments
    Brad- your article really opens my eyes- but I am not clear on a few things and I hope you will school me- you say at the Gold top a few days ago that there were signs the price would drop after the high- you said gold futures were in overbought territory- how did u know this and how do people know to sell at this high? I certainly want to learn how to sell my gold before it turns down? What do you mean the peak if not exceeded- double top etc? does it mean that gold will hold at this high? Please explain how a person can know gold will drop after reaching the $1000 price. Also I have noticed that gold has not dropped enough for me to buy back in if I sell at today’s price- I have to sell at $950 to be at least even and then I have to believe gold will go higher in order for me to buy back in. Where do you think gold will go in the next 6 months as Obama’s money plan reveals itself to be a failure-? If Jim Rogers thinks gold will continue higher because of fundamentals- what do you think of the fundamentals in a 1 or 2 year time frame?
  •  
    • craigdude
    • 6 Comments
    Brad- could gold be controlled by governments leasing gold and selling to keep lid on prices?–please explain double top and overbought
  •  
    • scotty1560
    • 155 Comments
    Brad.. listen gold has held up better than any commodity like oil or
    and any equity or real estate investment.

    It could drop.. I’m not that smart to predict.
    IMO the drop is after the economy recovers and that could take years at
    this point. It’s a safe haven and a trade against the dow.. I see the dow
    much lower.. so gold should at minimum hold it’s ground and perhaps
    rise towards 1500-2000, based on historical trends.
    In troubled times we humans tend to get religion and go back to
    ancient methods of survival.. gold fits that scenario.

    • Alex Filonov
    • 397 Comments
    • Website
    Couple more data points:

    1. NYMEX open interest for April exceeds open interest for all other months. ETF effect?

    2. India is not importing gold anymore. Regular buyer of 30% physical gold is out of the market.

  •  
    • jschulmansr
    • 7 Comments
    • Website
    Brad; Pontificating aside, where do you stand in relation to Gold? Both short term and long term? No charts or arguments just a simple statement I believe Gold will…

    Thanks!

    Jeff Schulman Sr aka jschulmansr

  •  
    • Brad Zigler
    • 60 Comments
    • Website
    No one, of course, “knows” gold will drop or rise from any particular price level. T

    here are, however, technical indicators such as the Relative Strength Index and stochastics which identify certain market levels as overbought or oversold.

    A double top is a price level reached a couple of times by a market as it attempts to rally higher but can’t be hurdled. The failure sets up a decline.

    About gold leases. Often, nefarious intente is ascribed to central bank swap activity. But leasing can be simply a way to garner a return on an otherwise sterile asset as well as a way to stimulate lending and investment activity.

    Outright borrows of bullion by bank customers tend to increase when bearish sentiments prevail. In essence, the borrower doesn’t want to face the prospect of buying back gold at a higher price to close out the loan.

    With that in mind, the market may already favor shorts BEFORE leasing.

    On Feb 27 09:25 AM craigdude wrote:

    > Brad- could gold be controlled by governments leasing gold and selling
    > to keep lid on prices?–please explain double top and overbought

  •  
    • jschulmansr
    • 7 Comments
    • Website
    Brad;
    Ps- I guess I should have added I think your articles are very well written and thought provoking. I make mention of and use your stuff on my blog quite often, but recently I have not heard your outlook for Gold. I do agree we are at a crossroads here, we may see more retracement. I think we are about to see Gold go and test it’s all time highs. Failure there I think will mean a retracement potentially as low to $880 to $890. If we clear due to manipulaton and where the short interest got in at there will be sttrong pressure to bring down prices at the $1050 level. If that hurdle is cleared I think that the banks who are short will give up and cause a very violent spike upwards “shortcovering rally”. After all they can afford to give in now as they figure they can get their money back thru Government stimulus, TARP, and bailout funds. Long term however, I do feel with inflation runnng a tad higher than what you are currently stating,and the fact that the monetary printing presses are running full steam round the clock; that longer term we will see inflation even hypr and/or stagfaltion. In other words get your wheelbarrow to haul your money around to go shopping for a “loaf” of bread. I truly think that prices of $2000 to $3500 oz are not unrealistic given the aforementioned scenario. What is your opinion in regards to this? Maybe even a special article?- Thanks Again- Jeff Schulman Sr aka jschulmansr
    Feb 27 11:29 AM |Report abuse| Link | Reply
    +10
  •  
    • Brad Zigler
    • 60 Comments
    • Website
    Don’t read too much into the large open interest in April futures. There are certain delivery months for gold that are traditionally more active than others. April is one of them (February, June, August, October and December are the others).
    Feb 27 11:31 AM |Report abuse| Link | Reply
    +10

    As February’s expiry approached, open interest rolled to the next active month in the cycle–April. Yes, some of that is ETF interest (namely, DBG, the PowerShares DB Gold ETF). It doesn’t, however, include the SPDR Gold Shares (GLD) or the iShares COMEX Gold Trust (IAU). These trusts hold physical metal, not futures.

    On Feb 27 10:31 AM Alex Filonov wrote:

    > Couple more data points:
    >
    > 1. NYMEX open interest for April exceeds open interest for all other
    > months. ETF effect?
    >
    > 2. India is not importing gold anymore. Regular buyer of 30% physical
    > gold is out of the market.

  •  
    • TexasER
    • 21 Comments
    Speculating on the price of gold has always been risky, never more so than now. If you’re in this trade to turn a quick profit, you have more guts or brains than me.
    Feb 27 11:48 AM |Report abuse| Link | Reply
    +10

    But as “melt-down” insurance, gold has performed exactly as advertised. I see no indication that it will somehow stop acting this way. If the markets fall off another cliff, obviously gold will do well.

    Diversification has always been a prudent strategy. That hasn’t changed, but gold’s importance to a diversified portfolio has changed. Some investors have recognized this out of prudence, not panic, and acted accordingly.

    I’m long, but if gold goes to $500 from here, you won’t hear me whining about it.

  •  
    • jschulmansr
    • 7 Comments
    • Website
    Brad; Thanks for your answer, I am sure you are aware of GATA, that is really were one of my main concern lies. The continued manipulation of prices by both governmental and banks. It will be very interesting to see what the CFTC and Comex are going to do with their investigations in both the Silver and Gold markets. Also long term I think we have a couple of big plays coming up with Silver and Oil. That’s what I love about the markets, sheer boredom puncuated by moments of either sheer elation or sheer terror! Thanks again! – Jeff Schulman Sr aka jschulmansr
    Feb 27 12:03 PM |Report abuse| Link | Reply
    +10
  • ========================================
    Now to “Market Price Manipulation…
    Ex-Treasury official Confirms Gold Suppression Scheme – Gata
    Source: Gold Anti-Trust Action Committee (Gata)
    Home » Daily Dispatches

    Ex-Treasury official confirms gold

    suppression scheme

    Submitted by cpowell on Tue, 2009-02-24 22:13. Section: Daily Dispatches

    5p ET Tuesday, February 24, 2009

    Dear Friend of GATA and Gold:

    In an essay published today at Counterpunch.org, former Assistant Treasury Secretary Paul Craig Roberts confirms that the U.S. government has been leasing gold to suppress its price and support the dollar. The admission is made in the last paragraph of the essay, which is appended.

    CHRIS POWELL, Secretary/Treasurer
    Gold Anti-Trust Action Committee Inc.

    * * *

    Doomed by the Myths of Free Trade: How the Economy Was Lost

    By Paul Craig Roberts
    Tuesday, February 24, 2009

    http://www.counterpunch.org/roberts02242009.html

    The American economy has gone away. It is not coming back until free trade myths are buried 6 feet under.

    America’s 20th century economic success was based on two things. Free trade was not one of them. America’s economic success was based on protectionism, which was ensured by the union victory in the Civil War, and on British indebtedness, which destroyed the British pound as world reserve currency. Following World War II, the US dollar took the role as reserve currency, a privilege that allows the US to pay its international bills in its own currency.

    World War II and socialism together ensured that the US economy dominated the world at the mid-20th century. The economies of the rest of the world had been destroyed by war or were stifled by socialism [in terms of the priorities of the capitalist growth model: Editors.]

    The ascendant position of the US economy caused the US government to be relaxed about giving away American industries, such as textiles, as bribes to other countries for cooperating with America’s cold war and foreign policies. For example, Turkey’s US textile quotas were increased in exchange for overflight rights in the Gulf War, making lost US textile jobs an off-budget war expense.

    In contrast, countries such as Japan and Germany used industrial policy to plot their comebacks. By the late 1970s, Japanese auto makers had the once dominant American auto industry on the ropes. The first economic act of the “free market” Reagan administration in 1981 was to put quotas on the import of Japanese cars in order to protect Detroit and the United Auto Workers.

    Eamonn Fingleton, Pat Choate, and others have described how negligence in Washington aided and abetted the erosion of America’s economic position. What we didn’t give away, the United States let be taken away while preaching a “free trade” doctrine at which the rest of the world scoffed.

    Fortunately, the U.S.’s adversaries at the time, the Soviet Union and China, had unworkable economic systems that posed no threat to America’s diminishing economic prowess.

    This furlough from reality ended when Soviet, Chinese, and Indian socialism surrendered around 1990, to be followed shortly thereafter by the rise of the high speed Internet. Suddenly American and other First World corporations discovered that a massive supply of foreign labor was available at practically free wages.

    To get Wall Street analysts and shareholder advocacy groups off their backs, and to boost shareholder returns and management bonuses, American corporations began moving their production for American markets offshore. Products that were made in Peoria are now made in China.

    As offshoring spread, American cities and states lost tax base, and families and communities lost jobs. The replacement jobs, such as selling the offshored products at Wal-Mart, brought home less pay.

    “Free market economists” covered up the damage done to the US economy by preaching a New Economy based on services and innovation. But it wasn’t long before corporations discovered that the high speed Internet let them offshore a wide range of professional service jobs. In America, the hardest hit have been software engineers and information technology (IT) workers.

    The American corporations quickly learned that by declaring “shortages” of skilled Americans, they could get from Congress H-1b work visas for lower paid foreigners with whom to replace their American work force. Many US corporations are known for forcing their US employees to train their foreign replacements in exchange for severance pay.

    Chasing after shareholder return and “performance bonuses,” US corporations deserted their American workforce. The consequences can be seen everywhere. The loss of tax base has threatened the municipal bonds of cities and states and reduced the wealth of individuals who purchased the bonds. The lost jobs with good pay resulted in the expansion of consumer debt in order to maintain consumption. As the offshored goods and services are brought back to America to sell, the US trade deficit has exploded to unimaginable heights, calling into question the US dollar as reserve currency and America’s ability to finance its trade deficit.

    As the American economy eroded away bit by bit, “free market” ideologues produced endless reassurances that America had pulled a fast one on China, sending China dirty and grimy manufacturing jobs. Free of these “old economy” jobs, Americans were lulled with promises of riches. In place of dirty fingernails, American efforts would flow into innovation and entrepreneurship. In the meantime, the “service economy” of software and communications would provide a leg up for the work force.

    Education was the answer to all challenges. This appeased the academics, and they produced no studies that would contradict the propaganda and, thus, curtail the flow of federal government and corporate grants.

    The “free market” economists, who provided the propaganda and disinformation to hide the act of destroying the US economy, were well paid. And as Business Week noted, “outsourcing’s inner circle has deep roots in GE (General Electric) and McKinsey,” a consulting firm. Indeed, one of McKinsey’s main apologists for offshoring of US jobs, Diana Farrell, is now a member of Obama’s White House National Economic Council.

    The pressure of jobs offshoring, together with vast imports, has destroyed the economic prospects for all Americans, except the CEOs who receive “performance” bonuses for moving American jobs offshore or giving them to H-1b work visa holders. Lowly paid offshored employees, together with H-1b visas, have curtailed employment for older and more experienced American workers. Older workers traditionally receive higher pay. However, when the determining factor is minimizing labor costs for the sake of shareholder returns and management bonuses, older workers are unaffordable. Doing a good job, providing a good service, is no longer the corporation’s function. Instead, the goal is to minimize labor costs at all cost.

    Thus “free trade” has also destroyed the employment prospects of older workers. Forced out of their careers, they seek employment as shelf stockers for Wal-Mart.

    I have read endless tributes to Wal-Mart from “libertarian economists,” who sing Wal-Mart’s praises for bringing low price goods, 70 per cent of which are made in China, to the American consumer. What these “economists” do not factor into their analysis is the diminution of American family incomes and government tax base from the loss of the goods producing jobs to China. Ladders of upward mobility are being dismantled by offshoring, while California issues IOUs to pay its bills. The shift of production offshore reduces US GDP. When the goods and services are brought back to America to be sold, they increase the trade deficit. As the trade deficit is financed by foreigners acquiring ownership of US assets, this means that profits, dividends, capital gains, interest, rents, and tolls leave American pockets for foreign ones.

    The demise of America’s productive economy left the US economy dependent on finance, in which the US remained dominant because the dollar is the reserve currency. With the departure of factories, finance went in new directions. Mortgages, which were once held in the portfolios of the issuer, were securitized. Individual mortgage debts were combined into a “security.” The next step was to strip out the interest payments to the mortgages and sell them as derivatives, thus creating a third debt instrument based on the original mortgages.

    In pursuit of ever more profits, financial institutions began betting on the success and failure of various debt instruments and by implication on firms. They bought and sold collateral debt swaps. A buyer pays a premium to a seller for a swap to guarantee an asset’s value. If an asset “insured” by a swap falls in value, the seller of the swap is supposed to make the owner of the swap whole. The purchaser of a swap is not required to own the asset in order to contract for a guarantee of its value. Therefore, as many people could purchase as many swaps as they wished on the same asset. Thus, the total value of the swaps greatly exceeds the value of the assets.* [See footnote.)

    The next step is for holders of the swaps to short the asset in order to drive down its value and collect the guarantee. As the issuers of swaps were not required to reserve against them, and as there is no limit to the number of swaps, the payouts could easily exceed the net worth of the issuer.

    This was the most shameful and most mindless form of speculation. Gamblers were betting hands that they could not cover. The US regulators fled their posts. The American financial institutions abandoned all integrity. As a consequence, American financial institutions and rating agencies are trusted nowhere on earth.

    The US government should never have used billions of taxpayers’ dollars to pay off swap bets as it did when it bailed out the insurance company AIG. This was a stunning waste of a vast sum of money. The federal government should declare all swap agreements to be fraudulent contracts, except for a single swap held by the owner of the asset. Simply wiping out these fraudulent contracts would remove the bulk of the vast overhang of “troubled” assets that threaten financial markets.

    The billions of taxpayers’ dollars spent buying up subprime derivatives were also wasted. The government did not need to spend one dime. All government needed to do was to suspend the mark-to-market rule. This simple act would have removed the solvency threat to financial institutions by allowing them to keep the derivatives at book value until financial institutions could ascertain their true values and write them down over time.

    Taxpayers, equity owners, and the credit standing of the US government are being ruined by financial shysters who are manipulating to their own advantage the government’s commitment to mark-to-market and to the “sanctity of contracts.” Multi-trillion dollar “bailouts” and bank nationalization are the result of the government’s inability to respond intelligently.

    Two more simple acts would have completed the rescue without costing the taxpayers one dollar: an announcement from the Federal Reserve that it will be lender of last resort to all depository institutions including money market funds, and an announcement reinstating the uptick rule.

    The uptick rule was suspended or repealed a couple of years ago in order to permit hedge funds and shyster speculators to ripoff American equity owners. The rule prevented short-selling any stock that did not move up in price during the previous day. In other words, speculators could not make money at others’ expense by ganging up on a stock and short-selling it day after day.

    As a former Treasury official, I am amazed that the US government, in the midst of the worst financial crises ever, is content for short-selling to drive down the asset prices that the government is trying to support. No bailout or stimulus plan has any hope until the uptick rule is reinstated.

    The bald fact is that the combination of ignorance, negligence, and ideology that permitted the crisis to happen still prevails and is blocking any remedy. Either the people in power in Washington and the financial community are total dimwits or they are manipulating an opportunity to redistribute wealth from taxpayers, equity owners and pension funds to the financial sector.

    The Bush and Obama plans total 1.6 trillion dollars, every one of which will have to be borrowed, and no one knows from where. This huge sum will compromise the value of the US dollar, its role as reserve currency, the ability of the US government to service its debt, and the price level. These staggering costs are pointless and are to no avail, as not one step has been taken that would alleviate the crisis.

    If we add to my simple menu of remedies a ban, punishable by instant death, for short selling any national currency, the world can be rescued from the current crisis without years of suffering, violent upheavals and, perhaps, wars.

    According to its hopeful but economically ignorant proponents, globalism was supposed to balance risks across national economies and to offset downturns in one part of the world with upturns in other parts. A global portfolio was a protection against loss, claimed globalism’s purveyors. In fact, globalism has concentrated the risks, resulting in Wall Street’s greed endangering all the economies of the world. The greed of Wall Street and the negligence of the US government have wrecked the prospects of many nations. Street riots are already occurring in parts of the world. On Sunday February 22, the right-wing TV station, Fox “News,” presented a program that predicted riots and disarray in the United States by 2014.

    How long will Americans permit “their” government to rip them off for the sake of the financial interests that caused the problem? Obama’s cabinet and National Economic Council are filled with representatives of the interest groups that caused the problem. The Obama administration is not a government capable of preventing a catastrophe.

    If truth be known, the “banking problem” is the least of our worries. Our economy faces two much more serious problems. One is that offshoring and H-1b visas have stopped the growth of family incomes, except, of course, for the super rich. To keep the economy going, consumers have gone deeper into debt, maxing out their credit cards and refinancing their homes and spending the equity. Consumers are now so indebted that they cannot increase their spending by taking on more debt. Thus, whether or not the banks resume lending is beside the point.

    The other serious problem is the status of the US dollar as reserve currency. This status has allowed the US, now a country heavily dependent on imports just like a third world or lesser-developed country, to pay its international bills in its own currency. We are able to import $800 billion annually more than we produce, because the foreign countries from whom we import are willing to accept paper for their goods and services.

    If the dollar loses its reserve currency role, foreigners will not accept dollars in exchange for real things. This event would be immensely disruptive to an economy dependent on imports for its energy, its clothes, its shoes, its manufactured products, and its advanced technology products.

    If incompetence in Washington, the type of incompetence that produced the current economic crisis, destroys the dollar as reserve currency, the “unipower” will overnight become a third world country, unable to pay for its imports or to sustain its standard of living.

    How long can the US government protect the dollar’s value by leasing its gold to bullion dealers who sell it, thereby holding down the gold price? Given the incompetence in Washington and on Wall Street, our best hope is that the rest of the world is even less competent and even in deeper trouble. In this event, the US dollar might survive as the least valueless of the world’s fiat currencies.

    *(An excellent explanation of swaps can be found here.)

    —–

    Paul Craig Roberts was assistant secretary of the treasury in the Reagan administration. He is coauthor of “The Tyranny of Good Intentions.” He can be reached at PaulCraigRoberts@yahoo.com.

    * * *

    Help keep GATA going

    GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at http://www.gata.org/.

    ====================================

    Have a Great Weekend! Keep your eyes open for a special weekend post. Good Investing! jschulmansr

    Follow Me on Twitter and be notified whenever I make a new post!

    Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ========================================

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

     

     

     

     

     

     

     

     

     

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    The Noose Tightens

    26 Thursday Feb 2009

    Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, Austrian school, Bailout News, banking crisis, banks, bear market, bull market, Comex, commodities, Copper, Currencies, currency, Currency and Currencies, depression, DGP, dollar denominated, dollar denominated investments, Fundamental Analysis, futures markets, GDX, GLD, gold, Gold Bubble, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, How To Invest, How To Make Money, hyper-inflation, IAU, inflation, Investing, investments, Jschulmansr, Junior Gold Miners, Latest News, Make Money Investing, manipulation, Market Bubble, market crash, Markets, mid-tier, mining companies, mining stocks, palladium, Peter Grandich, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, silver, silver miners, Silver Price Manipulation, spot, spot price, stagflation, Stimulus, Stocks, Technical Analysis, The Fed, Tier 1, Tier 2, Tier 3, TIPS, U.S. Dollar, Uncategorized, XAU

    ≈ 2 Comments

    Tags

    ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

    As I write Gold down $3.00 to $366 oz (April Contract). Things are getting very interesting, Japan’s exports drop a new record level. The Wall Street Journal has a quick article about investors wanting Gold in Hand (taking Delivery). As I wrote a few days ago the fastest way to create a short squeeze is to take delivery. Especially on Comex in both Gold and Silver. Is the noose getting tighter? Gold is in a consolidation pattern getting ready to take off? Some say yes other’s in fact a majority are saying no it’s time for a correction. As I mentioned yesterday when most of the crowd is saying one thing the market usually does exactly the opposite. We will see as I am keeping a very careful eye on the Gold market and will let you know via this blog and Twitter when I am getting out of the Long DGP trade. Finally! Cramer has finally decided to give Gold some coverage after a $200 rally, quick excerp below. Let the fun begin! Good Investing! – jschulmansr

    Follow Me on Twitter and be notified whenever I make a new post!

    Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

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    Cramer’s Mad Money- The EGO Has Landed (2/25/09) – Seeking Alpha

     

    Source: SA Editor
    Miriam Metzinger

    Good As Gold: Agnico Eagle Mines (AEM), Eldorado (EGO), SPDR Gold Shares (GLD), Yamana (AUY), Goldcorp (GG), Newmont (NEM)

    In spite of gold’s dip from $1,000 to $950, Cramer thinks the uncertainty in the U.S. and in Europe will be good news for the traditional hedge. The question is how to invest in gold. One way is to buy bullion or gold coins, but Cramer prefers stocks. SPDR Gold Shares is a good way to track the price of gold. Cramer would buy a fourth of a position at $90, another at $88, then $85 and $82. He reminded viewers that gold stocks have unique metrics; production growth, sensitivity of earnings to changes in gold prices and price-to-net-asset value. Two gold stocks worth looking at are Agnico Eagle Mines and Eldorado. Agnico has an impressive 344% growth rate, with Yamana at 56% and Eldorado at 27%. Eldorado keeps production costs very low at $286 per ounce: Goldcorp’s expenses are $397, Yamana $411 and Agnico is $483. Even though Agnico’s production costs are at the top, Cramer says they are going down. However, EGO is less sensitive than gold prices than AEM. According to the price-to-net-asset value, AEM is the most expensive, with EGO and Newmont behind. In short, Agnico has an impressive growth rate, but Eldorado might be a better value.

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    Worried Investors Want Gold on Hand – Wall Street Journal

    Source: WSJ Online

     

    Some investors are so worried about the prospect of economic collapse that they are buying gold and having it delivered to them, rather than holding the precious metal in the form of futures contracts or other securities.

    The global recession and worries about the stability of the financial system have sent the price of gold to $1,000 an ounce. But more surprising is that buyers are taking the unusual and expensive step of taking possession of it.

    “We’re having some of our strongest months ever,” said Scott Thomas, president and chief executive of American Precious Metals Exchange, a precious-metals dealer …

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    Oil, Dollar and Gold – Peter Grandich’s Blog
    Source:  Peter Grandich’s Blog

    One’s bottoming, one’s topping and one’s consolidating. Can you guess which is which?

    Give yourself a cigar if you said oil, U.S. Dollar and gold.

    The 50-Day Moving Average is just pennies away ($42.50). A close above it could bring in some technical buying. Some early signs of peak supply is showing up and with more people believing OPEC is living up to its quota’s, the mid $30’s look more and more like the bottom.

    We’re at one of the more critical technical points in quite some time. We either have a triple top just above 88 or a major breakout above 90. Because I’m so bearish long-term, I’m currently positioned on the short side. A break above 90 will cause me to rethink my position. Stay tuned.

    The magical $1,000 level has for now proven to be just a news story. I, myself, received several requests for interviews and comments last Friday on $1,000 gold from media people who don’t normally cover gold. This suggested to me that we got a little ahead of ourselves. The $925-$950 area should be the limit to this consolidation. Don’t be surprised if we shoot above $1,000 in the coming days.

    ================================

    Late Flash: They’re trying to manipulate the Gold market again or else the traders are trying the push. I have been stopped out of DGP @ $958. Nice trade. I will now be looking at my next entry point to jump back in again. Gold currently $943.60 (April Contract). I think the lowest April will correct to will be $925 oz (April Contract) and then we are back to challenging $1000 and the all time highs again. Remember 3’s a charm! Good Investing! – jschulmansr

    Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

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    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

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    Is the Glitter Fading?

    25 Wednesday Feb 2009

    Posted by jschulmansr in Austrian school, Bailout News, banking crisis, banks, bear market, bull market, capitalism, China, Comex, commodities, Contrarian, Copper, Currencies, currency, Currency and Currencies, deflation, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, Economic Recovery, economic trends, economy, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, Forex, futures, futures markets, GDX, GLD, gold, Gold Bubble, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, hard assets, How To Invest, How To Make Money, hyper-inflation, IAU, India, inflation, Investing, investments, Jschulmansr, Junior Gold Miners, Latest News, majors, Make Money Investing, Market Bubble, market crash, Markets, mid-tier, mining companies, mining stocks, monetization, oil, palladium, physical gold, platinum, platinum miners, precious, precious metals, price, price manipulation, prices, producers, production, run on banks, safety, silver, silver miners, Silver Price Manipulation, spot, spot price, stagflation, Stimulus, Stocks, TARP, Technical Analysis, The Fed, Tier 1, Tier 2, Tier 3, Today, U.S., u.s. constitution, U.S. Dollar, volatility, warrants, XAU

    ≈ 1 Comment

    Tags

    ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

         As I write Gold is down $3.00 at $966 (nearest futures month). It is still holding around the $960 to $965 support levels. However, I want to assert this, Gold is in a long term upward trend. The only thing that would change my thinking would be a close under the $880 which represents the bottom level of the long term uprward channel. We may however in the short term see a correction downward to even as low as $900 to $910. I will be watching very closely as this may be a “bear trap” in an upward market. One thing however I am somewhat of a contrarian. Last week almost every analyst under the sun was touting Gold as the ONLY investment. When I see that I get very nervous and know that a correction is about to happen.  For those who remember the day silver hit $50 oz., Walter Cronkite announced on his evening new that “It’s time for everyone to go out and buy some silver”! The very next day the silver market tanked like a lead balloon. So a little downside action here will be a good thing to shake out the “nervous nellies” and “johnny come lately’s” out of the market. Because I have seen it time and time again as soon as that happens “Kaboom” the market takes of and does not look back. I will be watching very carefully here and will let you (those who have subscribed to this blog and are following me on twitter), when I get out of the DGP trade. I got in at $890 oz and think a little patience here will pay off.  Given the current state of things Gold could still easily hit $1050 this week as well as have a price correction. Be sure to subscibe in the top right corner and/or follow me on twitter to be kept up to date…

         The best investment in my opinion right now is to continue accumulating the Junior and Mid-tier Gold and Precious Metals mining companies. Once again there are many still selling at or near book value levels. Remember to choose companies who currently have production or are about to start producing. One exception might be those companies who have made some big strikes,  are sitting on huge “proven” reserves, and have plenty of cash and financing to bring those reserves into production in the future. Another play is to investigate “Warrants” which give you the right to buy a stock at a given price for a certain timeframe. There are many out there which could give your portfolio a couple of “home runs” gains of 2-3000%. Either way do your own good due diligence, check the companies out, their balance sheets, prospectus/s  and consult your own financial advisors before making any trades.- Good Investing! -jschulmansr

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    Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    =============================

    Panic=Gold – Seeking Alpha

    Source: Hard Assets Investors

    It’s axiomatic that gold has a role as safe haven for many investors. That this is largely a matter of collective psychology is irrelevant – it has worked for centuries, and it’s unlikely to stop working tomorrow.

     But lately, gold been more than a mere market hedge; it’s been a panic hedge.

    Current Gold

    Gold briefly nudged over the $1,000 mark to $1006.43 on Friday, February 20, before settling back down to close at $993.25. It was the first time since last March that gold crossed the insignificant but satisfyingly round $1k level. Technical geeks would point out that it’s still below the high of $1012.55 hit March 18th, but that’s splitting hairs.

    Of course, gold didn’t stay above $1,000/ounce for long last March; it quickly reversed course and traded down all year, before bottoming at $712.41 on November 20th. Since then, gold has risen 39.4%; it was up 13.4% in January alone.

    The last time I wrote about gold (Demanding Gold) was just before that November bottom. Back then I discussed the underlying demand for gold – because one of the great things about commodities is that ultimately, they’re always about supply and demand. And with the gold-bug’s most important supply and demand report out for 2008, it’s the perfect time to revisit the subject. (The full link to the World Gold Council’s Supply and Demand Statistics for Q4 and Full Year 2008 report is here.)

    Looking At Demand

    Gold demand can be broken into three main areas of interest – jewellery, which accounted for roughly 58% of identifiable demand in 2008, industrial and dentistry demand, and finally identifiable investment demand.

    On the whole, gold saw demand grow 4% from 2007 to 2008, but the picture is a bit more complex than just that.

    Not everything was rosy for gold in 2008. As we predicted, jewellery demand was down significantly. In 2007 around 68% of gold demand was attributed to jewellery consumption. In 2008, that number dropped to 58%.

    At the end of December, The World Gold Council released a report entitled “What Women Want: Global Discretionary Spending Report 2008“. In it, the WGC details the values and significance different countries attribute to gold jewellery and why people buy it. One new thing the study uncovered is that gold jewellery is now competing with items such as cell phones and other everyday items for discretionary spending.

    The report also states that “confidence that gold will hold its value has waned,” reflecting in part the volatility gold prices have experienced in the past year. With gold rising and falling by 30% in a single year, it’s no wonder people are feeling less comfortable with it as a store of value.

    Demand on the jewelry front appears to be price elastic. In India, the largest consumer of gold jewellery, demand in the fourth quarter more than doubled compared to Q4 of 2007. While this would seem to buck the year-long numbers, it’s likely due to the fact that lower gold prices occurred precisely at the time of the Diwali festival – a peak gold-buying time in India. In 2007, gold prices were high during the festival, which depressed demand. For the full year of 2008, jewellery demand in India dropped 15%.

    China was one of the only countries that posted an increase in demand for jewellery, up 8% from 2007. Much of this demand was for 24-karat jewelry, which commonly implies jewellery purchases that are doubling as investments.

    The Big Stick: Gold Bugs

    According to the World Gold Council report, gold demand for investment rose from 663.7 tonnes in 2007 to 1090.7 tonnes in 2008 – a somewhat staggering year-on-year increase of 64.3%. Retail investment – things like bar hoarding, official coins, medals/imitation coins and other kinds of retail investment – almost doubled, going from 410.3 tonnes in 2007 to 769.3 tonnes in 2008. That gives some credence to the wide scale anecdotal evidence throughout the year that gold coins were virtually impossible to obtain in many countries.

    Exchange-traded funds and similar products also showed a large increase, from 253.3 tonnes to 321.4 tonnes (a 26.9% increase). This trend has continued into 2009. The SPDR Gold ETF (NYSE: GLD) – the largest physical gold trust – now has 1,028.98 tonnes in its vaults. This is a trust that started 2009 with 780.23 tonnes, meaning its gold horde has risen 31.9% in less than two months. To put that in perspective, 249 tonnes is over 10% of the total amount of gold mined in all of 2008. This acceleration happened almost entirely in a dramatic surge mid-February.

    Net-net, however, if you offset the huge rush in gold investments with the significant drop in jewelry demand, the net gain in tonnage terms was just 4%.

    There is, however, another way to look at things. When viewed through the (occasionally depressing) lens of the dollar, gold demand seems endless:

    Gold Supply in Flux

    With the demand part of the picture in hand, it’s time to turn to supply. The third quarter of 2008 saw a huge supply deficit with demand far outreaching supply. In the fourth quarter, supply rose 19%, almost entirely due to an increase in gold scrap. Yes, that’s right: Those late night commercials offering to buy your old tangled gold necklaces were on to something, and people were selling.

    Scrap sales for 2008 ended up 17% higher than 2007, and that along with slightly higher total mine supply just about offset lower central banks sales so that in the end, 2008 ended the year with only 1% less total supply than 2007 – practically even.

    The moral of the story is simple: supply and demand remain incontrovertible laws. The unbelievable demand vs. the stagnant (mine) and dwindling (central bank) supply created a vacuum, and a new source came on line to fill the need. Thus, at least indirectly, gold went from the scrap heap into brand new shiny gold coins, just when the market needed them the most.

    Which brings up the question: how long can consumers fill their own demand through scrap? And what price level is needed to support the tremendous scrap levels already in place?

    =================================

    Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ==================================

     Five Weeks of Silver Backwardation – Seeking Alpha

    By: Trace Mayer of Run to Gold.com

    During an interview with Contrary Investors Cafe on 24 February 2009 I discussed both gold backwardation and silver backwardation. After the interview I was asked why more commentators are not discussing this issue. I do not know.

    Regarding money there are two competing views: (1) money is determined by the market or (2) chartalism which asserts that ‘money is a creature of law.’ Governments can only manage money if they create it. Obviously, the market determines money because money existed before governments were created.

    Regarding gold there are two competing paradigms: (1) gold is a commodity and (2) gold is money. Paradigm (1) asserts that gold is a hedge against inflation and there is no monetary demand for gold. On the other hand, paradigm (2) asserts that gold is a hedge against currency collapse and the primary demand for gold is monetary. I subscribe to the second paradigm and assert that at all times and in all circumstances gold remains money.

    WHAT IS SILVER’S ROLE

    Under which paradigm does silver fall? Is silver a commodity or is silver money? For a commodity to be money its primary demand must be monetary.

    Like gold, for thousands of years silver functioned as money in the market. The term dollar, as used in Article 1 Section 9 Clause 1 and the Seventh Amendment of the US Constitution, is defined as 371.25 grains of fine silver under Section 9 of the Coinage Act of 1792. Governments stockpiled billions and billions of ounces. However, on 24 June 1968 the United States government defaulted on their silver certificates. Over the decades, silver, like gold, has been demonetized in ordinary daily transactions. Supposedly there are large stockpiles of gold in central bank vaults. Unlike gold there are no reported large above ground stockpiles of silver stashed in central bank vaults. Additionally, a large portion of silver demand is industrial as it is used in cell phones, refrigerators, dental equipment, computers, etc.

    Therefore, it appears that silver is confused about its role. In other words, silver functions as a commodity and as quasi-money.

    FIVE WEEKS OF SILVER BACKWARDATION

    While similar, there are differences between future and forward contracts. For example, future contracts are traded on exchanges, use margin and are marked to market daily. In contrast, forward contracts are generally traded over-the-counter (OTC derivatives) and are not marked to market. Therefore, forward contracts are subject to greater counter-party risk than future contracts.

    Because the primary reason backwardation arises is counter-party risk and because forward contracts are impregnated with greater counter-party risk than future contracts, therefore it is highly likely that backwardation would appear in the forwards markets before the futures markets.

    This is precisely what has happened. While the COMEX silver futures contract have not been in backwardation the LBMA Silver Forward Mid Rates have been in backwardation for five consecutive weeks. Of particular interest is the 6 month contract.

    SO WHAT?

    What does all this mean? Well, I think the backwardation reflects the market’s uncertainty of silver’s role as money. The chronic silver backwardation began on 8 December 2009, the same day I wrote about gold in backwardation, and silver was priced about $9.60. Currently silver is trading about $13.82. Predictably, the gold/silver ratio is narrowing. If the backwardation persists it will be interesting to see if silver’s price in illusory FRN$ continues rising.

    In my opinion, as the great credit contraction grinds on and intensifies, the commodity silver will reassert itself as money and eventually currency. As I mentioned during the interview with Contrary Investors Cafe what would be really interesting is if the central banks decide to start hoarding silver!

    In the meantime it may behoove those who are bullish towards silver to increase the pressure on physical silver delivery. For example, I purchased some beautiful Austrian philharmonics at the Cambridge House Investment Conference and Silver Summit over the weekend. The beautiful coin cost $20 which was an amazing $5.50 over spot.

    While there are cheaper ways to purchase physical silver bullion, like GoldMoney, these huge premiums over spot beg the question: What is the real silver price? With the specter of counter-party risk driving silver into backwardation if there is a failure to deliver then it will likely cause the silver price to shift from the COMEX just like a failure to deliver would cause the gold price to shift from the COMEX.

    Bottom line: Do not get caught with your paradigms down!

    ===============================

    Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ================================

    Doug Casey: What to Do in “The Greater Depression” — Seeking Alpha

    Source: The Gold Report

     

    Bullion and oil appear in the lineup of power players that Doug Casey thinks investors can count on as the world slips deeper and deeper into what he calls the “Greater Depression.” Despite the raging economic storm and Doug’s doubts that Western civilization’s governments will take the actions needed to quell it, though, the Chairman of Casey Research is nowhere close to calling the game. In fact, he sees silver lining in the clouds of crisis—opportunity—and expresses optimism that technological advances, coupled with capital rebuilding once over-consumption runs its course, will prevail eventually. The Gold Report caught up with the peripatetic author, publisher and professional international investor between polo matches in New Zealand, one of several nation-states he calls home from time to time.

     

    The Gold Report: You’ve been discussing what you’re calling “crisis and opportunity,” and in fact have a summit by that same name coming up in Las Vegas next month. Could you give us a high-level overview of what you foresee?

    Doug Casey: We’ve definitely entered what I describe as the Greater Depression. It’s not coming; it’s here. It’s going to get much, much worse as far as I’m concerned and unfortunately, it’s going to last a long time. It doesn’t have to last a long time, but the root cause is government intervention in the economy and everything they’re doing now is not just the wrong thing, it’s the opposite of what they should be doing. It’s almost perverse.

    The distortions and misallocations of capital and the uneconomic patterns of production and consumption that have been going on for over a generation need to be liquidated and changed, but everything the government’s doing is trying to maintain these patterns. So it’s going to be horrible. In addition, the government is necessarily directing more power toward itself with all of its actions. If I were you, I’d rig for stormy running for a good long time.

    TGR: By “a long time,” do you mean a couple of years, a decade, a generation?

    DC: This is, in some ways, uncharted territory. Let me say that for the long run I’m very optimistic. Why? Two things act as the mainsprings of progress. Number one is technology and that’s going to keep advancing, so that’s very good. Second is capital and savings. Individuals will solve their own problems and, therefore, they will stop consuming more than they produce, which is what they’ve been doing for years, and they’ll again start producing more than they consume. The difference is savings; that builds capital.

    So technology and capital are going to solve the depression. But the government can do all kinds of stupid things to make it worse. Look at the Soviet Union. They suffered a depression that lasted 70 years from its founding. Look at China. The whole reign of Mao was one long economic depression. That could certainly happen in the U.S., too, where the government misallocates capital in such a way that technology doesn’t advance as it could and people can’t build individual capital the way they would. I’m optimistic, but anything can happen.

    TGR: But didn’t China and the Soviet Union have governmental structures very different from those in Western Europe and the U.S., and those structures allowed for more intervention? Are you projecting that we might slip into an era where Western civilization will allow their government to run themselves like the Soviet Union and China did?

    DC: It seems to be going in that direction. Of course, Europe is going to be hurt much worse than the U.S. Europeans are much more heavily taxed and much more heavily regulated. The average European is much more reliant upon the state psychologically as well as economically. So it’s all over for Europe and this doesn’t even count the problems that they’re going to have in the continuing war against Islam, which are much more serious for Europe than they are for the U.S. So, no, Europe is fated to be nothing but a source of houseboys and maids for the Chinese in the next generation.

    TGR: So do you think that societies in Western Europe—and even the U.S.—will allow themselves to be governed in the same fashion as the Soviet Union and China were during their depressions?

    DC: Oh, totally. I don’t see why that would not be the case. Even Newsweek says we’re all socialists now. That seems to be the reigning ideology. In addition, psychologically, the average American—just like the average European—looks to the government to solve things. This is very bad. Most people are unaware that Homeland Security, which is one agency that should be abolished post-haste, is building a 400-acre campus in southeast Washington, D.C., where initially they’re going to put 25,000 employees. That’s as many as the Pentagon has and with 400 acres, Homeland Security has a lot more room to grow. Ironically, the property is at the site of St. Elizabeth’s Hospital, the first federal insane asylum in the United States. Once a bureaucracy has a piece of real estate and builds buildings, it’s game over. They’re just going to accrete and grow and grow, so that’s one indication. The trend is clearly in motion.

    It’s all over for the U.S. In fact, let me say this. America doesn’t exist anymore. What is left is not even these United States. That was decided in the 1860s. It’s the United States. America, which is basically an idea, a concept, is dead and gone. The United States is just another of 200 awful little nation-states that have spread across the face of the earth like a skin disease. There’s no longer any difference that I can tell between the U.S. and any other country.

    TGR: How would you describe the concept that America was based on that is now gone? And is there another country in the world embracing that concept? Will there be a new America?

    DC: No, there is no other place. I’ve been to 175 countries and lived in 12. My feeling is that the best thing that you can do is set your life up so that you’re not to be considered the property of any one government. You might have a passport or several passports and, therefore, that government thinks they own you. But if you don’t spend time in a country, practically speaking, there’s nothing they can do about it.

    So, no, there is no real haven for freedom in the world today. The best you can do is go where the governments are so unorganized that they can’t control you effectively. That’s one reason I like to spend time in Argentina. They have an incredibly stupid government, but they’re also very inefficient and ineffective. So it’s wonderful as a place to live. I also spend time in Uruguay, because it’s a tiny little country with no ambitions to conquer the world. The nice thing about New Zealand, where I am now, is that it’s a small country, only 4 million people, lots of open land. It’s got some severe problems, but it’s pleasant. I think the U.S. is going to be the epicenter of a lot of problems in the years to come.

    TGR: Few of our readers are probably in positions where they could live in 12 different countries, but they have amassed assets here in the United States. What advice would you give them to safeguard those assets?

    DC: The key is to remember that we’re going to have a long and deep depression, so most things that worked well over the last 20 years are unlikely to work well in the future. I’d been predicting the real estate collapse for a long time. It’s still got a way to go, too, because a lot of real estate debt remains that has to be liquidated. There’s a lot of leverage out there and there’s been a huge amount of overbuilding. So it’s far too early to get into real estate, at least in North America or Europe.

    It’s also way too early to get into the general stock market, for all kinds of reasons. Dividend yields are still extremely low. Earnings are going to collapse. Government bonds are perhaps the worst single thing to be in, because with the government printing up money literally by the bushel basket, the dollar is going to start losing value radically and interest rates are going to start going up radically at some point. So you have to rule out most stocks.

    I’m afraid that the most intelligent thing you can do is to own a lot of gold, preferably gold coins in your own possession. And I think speculation in gold stocks makes sense at this point, because gold stocks are about as cheap as they’ve ever been relative to other assets, really, in history. Now is an excellent time to do that as well. But that’s in terms of speculation.

    Investment risk is tough enough, but the biggest problem is political risk. That’s what you have to watch out for. That means you have to diversify internationally. This is harder for most people, harder psychologically, and it takes more assets to make international diversification viable. But if you’re in a position to do it, it’s the most important thing you can do.

    TGR: Since you mentioned having coins in your own possession, should we assume you’re not a big fan of the ETFs or some of these other paper gold promises, if you will?

    DC: ETFs are okay for the convenience that they offer and for significant amounts of money, but gold coins should be first on your list, no question about that. If you’re only talking about $50,000 or $100,000, or $200,000, coins are fine to keep in your own possession. They won’t take up much room and you can put them in some safe place (which, incidentally, is not a bank safe deposit box).

    TGR: Are you recommending putting all of your investment in gold into the bullion or are you also recommending some portion in producing junior and explorations?

    DC: Both, but look at the stocks as being speculative. Most of your money should be in gold with a bit of silver, too. Silver is basically an industrial metal, but it has monetary characteristics. Now is the time to be very overweight in the metals and I think owning gold stocks is a good idea. They’re very cheap.

    TGR: Anything else investors can do to preserve whatever may remain of their wealth?

    DC: Owning real estate in some foreign countries is a very good idea—from a lifestyle point of view, an asset diversification point of view, and a possible capital gains point of view, too. They can’t make you repatriate foreign real estate. Having some U.S. dollar cash while we’re going through this deflationary period is very wise as well, but that’s not going to last. Eventually the U.S. dollar is going to reach its intrinsic value.

    TGR: Not that you have a crystal ball, but how would you see the rest of ’09 playing out?

    DC: Nothing goes straight up or straight down, but it seems that ’09 is going to see much higher gold prices and much lower stock prices and much lower bond prices, too. But remember, the worst is yet to come.

    You haven’t heard an awful lot about people losing their pensions yet, but that’s going to happen because what are pensions invested in? They’re mostly invested in stocks and bonds and commercial real estate. All three of those things are disaster areas, and bonds are the big disaster area yet to come. So I think it’s going to be nothing but bad news in 2009. What happened in 2008 was just an overture to what I think is going to happen in ’09 and ’10.

    TGR: Even into 2010?

    DC: Yes. This isn’t going to be cured overnight, mainly because of what the government’s doing. As I said, it’s perversely exactly the opposite of what they should be doing, which is abolishing all the agencies and freeing up the economy. They’re passing lots of new regulations, they’re going to have to raise lots of taxes eventually, and they’re inflating the currency. So it has to last, at least into 2010. It’s going to be quite dismal, actually.

    TGR: And what happens with the unfunded Medicare liabilities?

    DC: They’re not going to be funded. They’re going to be defaulted on and, actually, that’s the best thing that could happen. That’s one of the things that should be done now; the U.S. government should default on its debt. This is shocking for people to hear, but it wouldn’t be the first time the U.S. government has done that. It did that almost at its founding in continental days.

    This debt represents a tax liability that’s being foisted off on the next generations who have no moral obligation to pay and should not pay. I think as an ethical point, the U.S. should default on this debt. It’s impossible to pay it back, and it won’t be paid back. It’s more honest to acknowledge that bankruptcy now as opposed to pretend it’s going to be paid back. Defaulting even might forestall runaway inflation in the dollar, which would be a catastrophe of the first order. So it’s the smart and moral thing to do, and it’s going to happen eventually anyway. All the real wealth will still be here; a lot of it will just change ownership. The big losers will be those who lent to the State, thereby enabling its depredations, and they deserve to be punished.

    But even a default tomorrow will do no good unless you put the U.S. government into reverse and disband all of these ridiculous, destructive agencies that have grown like a cancer for years. Taxes should be cut 50% to start with, just out of hand. And the defense establishment—it’s a misnomer; it’s not defense at all but rather foments wars around the world—should be cut hugely. Not with a butcher knife; but a chain saw. But none of this is going to happen; in fact, just the opposite. That’s why I’m so pessimistic now that the tipping point’s finally been reached.

    TGR: Are we at the tipping point?

    DC: Yes, we’ve absolutely gone over the edge. The consumer is no longer in a position to consume. Everybody is going to cut consumption to the bone and hopefully find something to produce instead. It would be better for people to start viewing themselves as producers than consumers. That would be a step in the right direction to get them psychologically more in line with reality.

    TGR: In last fall’s meltdown, gold held up, but the stocks didn’t. Quite a few producers and soon-to-be producers, and some companies making discoveries, seem to have bottomed out in November and December. But worry persists in the market. Suppose another shoe drops or another black swan appears? Richard Russell (Dow Theory Letters) and others have been talking about the Dow going down to 5,000. What would that do to the gold stocks?

    DC: Gold stocks are also stocks, and the best environment for gold stocks historically has always been when both gold and the stock market are going up. But since the last gold stock bull market came to an end, I think it’s entirely possible to see a bubble develop in gold stocks with all the money being created. I certainly hope so. I’m actually optimistic for gold stocks just because they’re so cheap relative to everything else.

    TGR: They have been beaten down.

    DC: Yes. And that fact, along with the waves of money being printed around the world and the much higher gold prices we are going to see, could cause a speculative mania to develop in the gold stocks. Nobody’s even thinking about that possibility right now, because they’re so battered. But this is the time to get into the right ones because it’s likely to happen in the future.

    TGR: The ’29 crash—which was really the preamble, because ’30, ’31, ’32 and ’33 were certainly bigger—is when gold stocks such as Homestake did their best. How do you see that playing out this time around? Is it different this time or do you expect a similar pattern?

    DC: You know what they say, “History doesn’t repeat itself, but it rhymes.” I think that, first of all, the gold mining industry is a much worse industry now than it’s ever been in the past, because just as all the easily defined light sweet oil basically has been discovered, all the easy-to-find high-grade gold basically has been discovered. Most mines that are going into production are low-grade, which means that you have to move a lot of dirt, which means that they’re much more capital-intensive than in the past. So gold mining’s a worse industry from that point of view.

    Also, politically speaking, with the rise of the green movement, there are people who don’t want any oil burned, any dirt moved, any trees cut. They don’t want to see anything happen. This makes it much harder to do gold from a permitting and political point of view. We’re in a much higher tax environment than in the past. So it’s a tough industry. It really is. It’s just a 19th century choo-choo train type of industry that interests me only as a speculative vehicle. You’ll notice that gold went from lows of about $300 to highs of about $900 and none of these gold companies are making any money because their costs actually went up faster than the price of gold. So I’m not saying gold mining is a great business. It’s not. It’s a crappy business. Still, we could have a bubble in the stocks. I’m hoping we do.

    TGR: Aren’t we going to see a change in that in ’09? Oil, which is one of the large components of that cost, has come down dramatically. A lot of these producers must be locking in oil at these lower prices. Won’t that translate into year-over-year earnings increases for the gold producers?

    DC: That’s possible. The producers actually may show increases for the next couple of years. I don’t doubt that. But I don’t think oil will stay where it is. I think oil’s eventually headed back to $150 a barrel or more.

    TGR: So why wouldn’t you own oil as well as gold?

    DC: It’s a good idea, but we weren’t really talking about oil. I’d say that oil is a good thing to own. Oil is a real buy now. It’s as good a buy at $40 as gold is at $900 right now. Maybe a better buy; who knows?

    TGR: If we go into worldwide depression, will oil continue to be a good buy or will it self-regulate around this $40 a barrel?

    DC: I am bullish on oil. Although I’m philosophically not very sympathetic to the peak oil theory, I think it’s a geological fact. Also, China and India and the other developing parts of the world don’t use a whole lot of oil now. As they develop, they will to want—and almost need—to use a lot more oil. That’s going to keep pressure up on the demand side. But the supply side actually finally is constrained, so it’s going to mean higher prices. In a depression-type environment, U.S. and Western oil consumption could drop a lot, but the third world would take up most of that slack. So I have to be bullish on oil.

    TGR: Are you bullish on any other sectors or commodities?

    DC: I’m bullish on agricultural commodities. They ran way up last year and then collapsed again. I think a good case can be made that most of the soft commodities are quite cheap and will go higher, so I’d look at those, too. I think gold definitely, oil in the years to come has the potential to go much, much higher, and the agricultural commodities have a lot of potential.

    TGR: Gold appears to be uncoupling from the dollar. Historically, when the dollar was strong, gold would be weak. But we’ve had a couple of recent instances in which both the dollar and gold have been strong. Obviously, we’ve seen a total decoupling of gold from oil. It used to be when oil was running, gold was running and vice versa, but that no longer seems to be the case. Is that just an old wives’ tale or is something going on?

    DC: I’ve never seen any necessary relationship between gold and oil, just like there’s no necessary relationship between rice and natural gas, or nickel and soybeans. All these commodities tend to move together, all the currencies tend to move together and stock markets tend to move together, but they all have their own dynamics. I think it makes sense to compare the relative prices of various commodities and see what may be cheap or dear relative to other things based on the fundamentals.

    On any given day, somebody may have to buy or somebody may have to sell a huge amount of almost anything. It’s unpredictable and you can’t tell what constraints are out there in the market. I don’t even pay attention to day-to-day fluctuations because they’re just random noise. I watch the big trend. It’s been shown that if you just made one correct trade and stuck with it at the beginning of every decade for the last four decades, you would have realized something like 1,000 times on your money. To me, this is the proper approach to the markets, not to try to second-guess from day-to-day what’s going to happen. That’s foolish because you get chewed up with commissions and bid-ask spreads and double-thinking your own psychology and so forth.

    I really just like to look at long-term trends. In terms of long-term trends, you’ve got to be long gold, long silver, long oil; you’ve got to be short bonds. I think that’s really all you need to know. The other things we mentioned such as agricultural commodities and so forth are worthy of attention. But, as I said, I’m not a day-to-day trader. I think that’s very foolish.

    TGR: Are these the themes that you and your group of speakers will focus on in Las Vegas?

    DC: They are. I certainly want to invite anybody who reads this interview to join us. We put on very small, very classy seminars. They’re not gigantic mob scenes, so it’s possible to get to know individual speakers and fellow attendees in a very collegial atmosphere. I think it’s something that anybody who’s seriously interested in these kinds of things should consider.

    The Casey Research Crisis & Opportunity Summit, will be held March 20 – 22, 2009, at the Four Seasons Resort in Las Vegas.

    A citizen of the world in more ways than most of us can imagine, Doug Casey, Chairman of Casey Research, LLC, is the international investor personified. He’s spent substantial time in about 200 different countries so far in his lifetime, living in 12 of them (currently New Zealand and Argentina). And Doug’s the one who literally wrote the book on crisis investing. In fact, he’s done it twice. After The International Man: The Complete Guidebook to the World’s Last Frontiers in 1976, Doug came out with Crisis Investing: Opportunities and Profits in the Coming Great Depression in 1979. His sequel to this groundbreaking book, which anticipated the collapse of the savings-and-loan industry and rewarded readers who followed his recommendations with spectacular returns, came in 1993, with Crisis Investing for the Rest of the Nineties. In between, his Strategic Investing: How to Profit from the Coming Inflationary Depression (Simon & Shuster, 1982) broke records for the largest advance ever paid for a financial book. Bill Bonner (The Daily Reckoning) describes Doug as “smart, hard-working, and extremely knowledgeable” with “an instinct about investments that has made him and many of those around him very rich.”

     Doug, who now spends more time as an expatriate than he does on American soil, has appeared on NBC News, CNN and National Public Radio. He’s been a guest of David Letterman, Larry King, Merv Griffin, Charlie Rose, Phil Donahue, Regis Philbin and Maury Povich. He’s been the topic of numerous features in periodicals such as Time, Forbes, People, US, Barron’s and the Washington Post – not to mention countless articles he’s written for his own various websites, publications and subscribers.

     ==================================

    Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    That’s all for Today- Enjoy! jschulmansr

    Follow Me on Twitter and be notified whenever I make a new post!

    ================================== 

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

     

     

     

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    Support At the Pit Stop

    24 Tuesday Feb 2009

    Posted by jschulmansr in banks, bull market, Comex, Currencies, currency, Currency and Currencies, deflation, depression, DGP, dollar denominated, dollar denominated investments, Economic Recovery, economic trends, economy, Federal Deficit, federal reserve, Finance, financial, Forex, Fundamental Analysis, futures, futures markets, GLD, gold, Gold Bubble, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, How To Invest, How To Make Money, hyper-inflation, IAU, inflation, Investing, investments, Junior Gold Miners, Latest News, majors, Make Money Investing, Market Bubble, Markets, mid-tier, mining companies, mining stocks, oil, palladium, physical gold, platinum, platinum miners, precious metals, price, price manipulation, producers, production, silver, silver miners, spot, spot price, stagflation, Stimulus, Stocks, Technical Analysis, The Fed, Tier 1, Tier 2, Tier 3, U.S. Dollar, Uncategorized, XAU

    ≈ 1 Comment

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    ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

    Gold is resting today, taking a quick pitstop allowing people to jump in on the next rally to $1033 and then if clear that $1050+. All of this talk of the Gold bubble. Bubble or not there is some serious money to be made here- even at these levels. Have some stories to tell your Grandchildren and Great Grandchildren of how you “caught” the Gold Bull.  Get in now or you will regret it!  Gold currently holding above the key support level of $985. Gold needs to clear the $1026 to $1033 level to be sustained in it’s upward rally. A note of caution if it fails at $1033, retracement back down to $900 is possible, I would put in a trailing stop to protect your current profits.  I recommend a 20-25% trailing stop so you don’t get caught in a whipsaw market action. Stay tuned as I am still long DGP and will tell you when I am getting out. Good Investing! – jschulmansr 

    ps- Follow Me on Twitter and be notified whenever I make a new post!

     Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ==========================================

    Protecting Yourself from a Gold ETF Bubble- Seeking alpha

    BY: Tom Lydon of ETFT Trends

     

    Are gold ETFs entering a bubble? More and more people seem to think so.

    Last week, we noted a story that contained 12 reasons to short gold. Barron’s raises the question, too, now that gold is priced above $1,000 an ounce. The price is equivalent to more than 25 barrels of oil, a ratio that has rarely been exceeded in the last 35 years, says Michael Santoli for Barron’s.

    There are two sides to the argument:

    Owning gold seems logical now, given that the turmoil has gone completely global. Gold has also been rising, even as the U.S. dollar is gaining strength, too.

    On the other hand, SPDR Gold Shares (GLD) is now routinely turning over $2 billion worth of trading each day, which might give investors pause. Is it becoming a herd mentality?

    Meanwhile, Brett Arends for The Wall Street Journal gives the ins and outs of gold investing, including that gold is volatile and no one knows its true worth. For that reason, the mania is to be taken with a pinch of salt, he says.

    While gold can be a volatile metal, right now, the trend is there. You can’t fight it. But if you’re in gold, have an exit strategy at the ready (we get out either 8% off the recent high or when it falls below the 200-day moving average). This will help protect investors from further losses, and may even preserve some gains that might have been made.

     

     

     

     

     

     

     

     

     

     

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    My Note: The reason I put my stops at a greater percentage than 8% is from my days as a futures trader. Traders on the floor love tight stops of 5%, 10%, and even 15% and will often bid a commodity down 10%-15% to catch people’s stops and then let the market rise and pocket the money. This happens especially on days of lower volumes of trades. Watch carefully and his idea about exit after a close below the 200 day moving average is sound, remember though that it is a daily close (end of day) below the moving average not intraday trading. For those who already know this remember I have readers who are newbies and don’t know all the ins and outs, this is for them as I care about all my readers! – jschulmansr

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    Next Here is the Article mentioned above…

    Gold: Where to Invest and What to Avoid – Wall Street Journal

    Source: Brent Arends of WSJ.com

    Great news. The next bubble has already begun!

    We’re still in intensive care from the stock market, housing and credit bubbles, but a gold bubble is now underway.

    The precious metal crossed $1,000 per ounce on Friday, as investors around the world rushed to “shelter” their money from financial meltdown and spendthrift governments. And many people think it may rise to $2,000 or even $3,000.

    Ordinary investors are jumping aboard. They’re buying gold coins or the gold exchange-traded fund, GLD.

    I’m not against investing in gold-mining stocks. I recommended them here a few months ago — just before they began skyrocketing. It could certainly make sense to put 5% or 10% of a portfolio in the right precious metals fund. I have one suggestion below.

    But look out before buying actual coins, bullion, or the ETF. This is risky.

    First: Gold is incredibly volatile. It can halve, or double, in short order. This is not like a normal mutual fund.

    Second: No one really knows what gold is worth, because it generates no cash flow. Any numbers are pure guesswork.

    And third: Investing directly in gold violates the old adage that you should never get into bed with anyone crazy. Gold fanatics are far-out nuts. No kidding. If you met these people you’d run a mile.

    Even some intelligent, and otherwise sensible, people aren’t immune from the madness. They will pound the table and insist gold is the only “real” money because it’s been coveted since ancient Egypt, if not before.

    Please. Ancient superstition is no argument. People around the world used to think only a monarchy could be a “real government”. Sorry, I’m not buying the Divine Right of Gold any more than I buy the Divine Right of Kings.

    Ancients coveted gold for three reasons. It was pretty. It’s really soft, so it was easy to manipulate with primitive tools. And they didn’t have many other material things worth desiring, like split-level oceanfront homes or flat screen TVs or first-class tickets to Hawaii. The ancients were short on opportunities for retail therapy.

    The world has changed since, so take gold mania with a certain pinch of salt.

    [How to Invest in Gold] Associated Press

    Gold ingots from Switzerland, America and Germany are shown on display at The Coin Broker store, in Palo Alto, Calif.

    Nonetheless gold has some value. So do other precious metals. (I think the long-term case for platinum is stronger – but that’s another column.)

    Every government on the planet is printing money in the trillions to stave off a prolonged depression, and they’re going to continue to do so until it works. Precious metals cannot be manufactured in the same way. So you can expect them to rise in price.

    Shares in the big gold miners, like Barrick and Newmont, have been booming for a few months.

    But the smaller ones are still looking very cheap – especially compared to the gold price. (See chart.)

    These stocks got absolutely crushed last year, along with gold prices and small company stocks.

    Although they have started rallying too, they have much further still to go. Ordinary retail investors haven’t started buying them – yet.

    Don’t go it alone. Investing in gold minnows is tricky.

    One mutual fund worth a look: US Global Investors’ World Precious Minerals Fund. It’s one of the few to focus mainly on smaller gold stocks.

    Manager Frank Holmes, a 20-year industry veteran, agrees the juniors are comparatively cheap. And he sees takeovers starting as well. “Eventually the seniors will have to gobble (the juniors) up,” he says. “They can’t find enough gold to replenish their production.”

    Write to Brett Arends at brett.arends@wsj.com

    ====================================

    My Note: What Have I been telling you about the juniors? Remember as a general rule I buy those junior miners which currently are producing or are about to start production in the very near term. These companies I believe are the ones who will be the most attractive takeover candidates. My disclosure: I am Long GLD, UNPWX, along with many of the juniors too-jschulmansr

    Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    =========================================

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

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