moin from germany,

here is a nice story that could impact future stock buybacks

Tougher Times For Buybacks? / IRS Shutting Down Tax Loophole

I.R.S. Moves to Close Tax Shelter Shortly After I.B.M. Uses It to Save $1.6 Billion

As part of a $12.5 billion stock repurchase, I.B.M. used a foreign subsidiary to buy back shares through foreign exchanges. The subsidiary then used the shares to pay its corporate parent in America for goods and services.

The technique was believed to be in wide use by corporations that have substantial profits offshore and are also buying back large amounts of their own shares to return value to investors. I.B.M. appears to be the only company that publicly disclosed its use of the tax shelter....

By avoiding the 35 percent federal tax on profit, a company can buy three shares for every two it would be able to acquire with profits that had been taxed.

Wow, bonds are getting smashed, T-Bond at 107.8 wait no now 107.625 another gap down.
Yield curve is completely un-inverted.

Somebody is making this bond thing happen so that when equities pull back the price will be right for HB&B

Gold is stuck

Will anyone chance to characterize Bill's guidance on the market?

Mentions traders not hanging around for damage, but bulls can relax. This looks like cross roads to me with major averages being attacked.

Gold Price May Rise to $1,000 on `Tight' Supply, JPMorgan Says By Jesse Riseborough

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=att3dm6ELVzk

Hello all,
wish to opine anyone? did i read it here or somewhere else last week that JPMorgan was buying lots of gold???

It's good to hear someone besides McEwen predicting 4 digit gold prices...

Re: JP Morgan on Gold

I think Kaimu posted a report which mentioned JP Morgan taking delivery of $700 million worth of gold.

AU @ $1000, yes but this price action will be mid-fall 07 into next year!

JogyP, thanks for the reminder--here's the post from last Friday:

ALOHA !!

ISSUES AND STOPPERS ...

JP MORGAN takes delivery of 1.16mil ounces of gold equal to $768milUSD, average buy price $662USD.

June 1, 2007 NYMEX Delivery Notice Link: http://www.nymex.com/media/delivery.pdf

On the link(for one day)JP MORGAN secured 918 contracts worth some 91,800 ounces or around $61milUSD. Also see that HSBC(506) and UBS(104) also took delivery. Rarely if ever does JP MORGAN take a large delivery, which now means they have to pay to have those ounces moved from the NYMEX warehouse vault to be stored at some other vault, perhaps their own. Unusual for JP MORGAN ... is JP MORGAN covering some swaps due to failed short positions? Is HSBC in the same boat? It is by far cheaper and easier to settle these accounts with "electronic fiat" than it is to lug around literally tons of gold! What happened that these guys need "the real deal"? Where are the final destinations for these gold bars? Would this info ever be disclosed on a JP MORGAN financial report? If it was, then what do they call this $768mil gold deal? Where's that "line item"? Is it "SHALLOW STORAGE" as opposed to "DEEP STORAGE"? The transparency of the gold market is like a thick Louisiana swamp mud mixed with a some nice sludgy Brent crude! That in itself speaks volumes to the fear of collapse these bankers have for their global "fiat empires"! These guys are in CONSTANT spin mode for every market they infest ... Just unbelivable!!!

Posted by: kaimu at June 2, 2007 6:38 PM

..make that last Saturday..

Jasper,
Remember, Bill is catering to both day/swing traders and long term investors, so he has something for each time frame.

Pointing to the dow chart you can see the end of the day buying, which Bill suggested is a bit of support on these down days.
If that ends then both traders and investors need to take note of it.

For traders this indicates short term action and for investors it might hint of a correction or the start of a down trend to avoid.

Is anyone else watching the VIX this morning? It has shot up in the past few days and has broken through it's uptrend line.
I think I may start to build a position in some of the Pro Share Ultra Short ETFs.
Nothing like a little insurance.

Bill,
Including the short explanation of your system and modifications readers might use at various times is really helpful. I suspect you get all kinds of questions regarding this, so it's really nice you have kept it in the daily commentary.

I notice Cramer was on this AM pushing on gold.
He said it should be over $700 right now and was pestering an analyst for his explanation.

Hard to knock him when he's in your corner....

my own defensivenss prompts me to say that I value what Bill has to share, any confusion I have I attribute to myself. and, I would gladly consider a premium newsletter, not that that would make me a client, per se.

re: MPEL
Wynn slows Macau expansion.

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070607:MTFH18917_2007-06-07_14-41-47_N07187740&type=comktNews&rpc=44

This does not look good for MPEL.

going long paas...

interesting, take it for what it's worth...

http://www.crossingwallstreet.com/archives/2007/06/morgan_triple_s.html

long SDS QID

With the 10 Yr at 5.09% a switch from equities to bonds appears to be underway. When the yield is below 5%, equities look to be a good bet but once that pscychological barrier of 5% is crossed, institutions start to reassess risk. Looks like this is the scenario that is currently unfolding. Also to note, institutional net buying activity has dropped precariously in recent days.

Bill - "Re the current sell-off in bonds, I think I was early in focusing readers on interest rates/yields. ..."

Like Craig, I appreciate your daily remarks and the ongoing commentary on your system(s) for trades One of the "mentions" in your system comments is a reference to the use of MACD, which is a "trend indicator". For learners, there are, of course, other trend confirmation, or trend-change, indicators, that can be used including a simple line drawn on a timing chart of preference in order to have some confimation that the time might be right to buy/sell in a "zone".

I try to wait for such a confirmation, and thus, it bothers me NOT at all if you "focus" on something such as bonds early. That "focus" is just a "camera shot in time" that says the "geese seem restless on the pond"; but, each one in the photo blind with you must wait until the "lead duck" lifts firmly upward before getting excited; ie, wait for the trend to actually show itself as moving in the desired direction.

Perhaps, additional emphasis in your system commentary could be made on that point? Perhaps, too many people in our community are trying to jump out early and catch "daggers"?

Just my humble response.

Of course, Morgan cleared it's short position in gold before urging others to go long with visions of $1,000, right?

And they won't be using their shiny new gold for futher selling into the spot market as it rises, correct? Or writing covered calls they know they themselves will not allow to go ITM via spot market sales? A million ounces is a lot of ammo to take down gold whenever you want to.

Of course we never get to know all that, do we?

Signed,
Bitter failed gold trader.

But a happy owner of a little pile of physical metal.

(Mike
NYC)

JogyP (and friends)
Please utilize tinyurl.com for sharing the long url's. Long url's (over 80 chars. or so) won't format well for mozilla users, and the whole page starts to get funky
Thanks!

Craig said: “I notice Cramer was on this AM pushing on gold.
He said it should be over $700 right now and was pestering an analyst for his explanation.
Hard to knock him when he's in your corner....”
I heard this also, but I did not get the impression he was supporting gold here. My take is that he is perplexed as to why we are showing more inflation, but that gold has not responded by being over 700, and what does this mean.
Thanks to JogyP for the Wynn info. For my money it will be WYNN over MPEL. Liking the action in CLF, TYC, CAT market action notwithstanding.

Anyone,
Please share if there is some kind of internal breakdown on KGC chart? Or opine if it might be just market and the way of gold trading. I'd like to know if worry is warranted as of today or RELAX.
Thanks much,

Telestar3d,
I was hearing more of "Why isn't gold $700?" "Gold should be over $700 here", which he repeated several times Cramer style. A matter of interpretation I guess.

Moneygenie,
I didn't check your co. but rest assured, everyone but aapl and the short etfs is getting a haircut today. Ask why you see this action in bonds and it should lead you to inflation and devalued USD, which leads to.....Cramer being right?

Carry-trade unwind started?
My favorite graph NewZealand dollar against Yen is showing a quick change today!
http://finance.yahoo.com/q/bc?s=NZDJPY=X&t=1d
Is it the start for something big?
Shame on me for betting on more gold, instead of this...

Still waiting on gold and miners, folks (for anyone who cares to know!). If I am absent from these pages (and I very well may be)I left the playbook with someone you trust.

Regards,

Dear Bill and Friends,

Is the drop in gold as simple as the market believes Bernanke, he can't or won't cut rates, ever, probably, and future higher rates portend lower inflation? Is it as simple as that? I have known in my heart that Uncle Ben would not lower rates as the equity market was jonesing for him too, remember it wasn't too long ago that without a rate cut, stocks were gonna tank. What was that, last year around this time? Also, I think that VZ just mentioning Las Cristinas has invigorated the KRY shareholder, who would be happy for any kind of reasonable split with VZ in xchange for an operating gold mine.

Chris

I am thinking of reducing exposure to miners.

Bloomberg article on Gold in TinyURL!
http://tinyurl.com/25uurk
We are undoing last THU, FRI gains.

My gut feeling is that the miners and PM will go down with the rest of the market short term.

Wonder why AMZN is still up at 73? I thought it was a short at 63 last month.

Brandonalpha,
are you still tracking GROW? After this morning's head fake, it seemed there's consistent accumlation today. I think it would be range bound between 22.5x to 24.8 for a while, but couldn't help to notice some interesting price action under t&s. Fireworks will be all over the sky "IF" the PMs settle down and head back up...
What're your thoughts?
Thanks much,

Joe Public selling real estate and piling money back into stocks:

http://tinyurl.com/3dxotd

If you wanted an indicator that the final boom and subsequent crash is nigh at hand....

Good one GTT, also Mogambo mentions yesterday that HB&B are looking for a way to sell their crappy subprime mortgage debt on the market to investors, oh yeah looking for ways to offload.

Big and regional banks, broker dealer index, down, home builders majorly down.

Bill, other experts: If equity sell pressure is high and bonds are being spurned as well, where is all this money going, it has to be popping it's head up somewhere?

Steve

The Bane of Crystallex's existence had to climb down when a reader pointed out that a Chavez news release which Bane quoted as a threat to KRY was actually two years old. Other commentators in the same thread basically pointed out that he was useless and biased. Worth a read.

GTT, from your link caption:

"Last month Frank and Kathleen Schlier sold one of their investment properties near San Francisco and pumped the proceeds into the stock market."

That was a precious one.

James Grant's Forbes column notes that gold has recently become much more correlated with equitiesf (from 0 to .6). He attributes this to arrival of "opportunists" (I read as hedge funds) alongside traditional "goldbugs" as holders of gold.

The opportunists regard gold as just another investment. When it goes down, they'll sell (unlike true-believer goldbugs).

Grant believes gold will only re-initiate its run once the opportunists lose faith in the paper (fiat) money being created around the world to absorb US$$$.

Caution: Grant has a bit of a reputation for always entertaining, but never making money. Who knows if it's true ...

From the article on housing: "Winans and others think the sloshing of money from real estate into stocks is one of the factors fueling the stock market's recovery to record levels. "Inventories (of unsold homes) are up while coinciding with volumes and prices of stocks going up," he says. "Surprising there aren't more people connecting the dots."" I don't see how this is a correlation. If unsold inventories are up, then the housing money is *not* fueling the "volumes and prices of stocks going up." If I'm holding part of that unsold inventory, then how can my money be going into the market. Or am I missing something here?

M.-

Kurtwalter,

Unfortunately, Bane's drek is still hosted by Seeking Alpha. I wonder how many readers actually scroll down through the comments. Personally, I've written Seeking Alpha twice through their Reader Feedback regarding my belief that Bane's articles are inappropriate on a credible website. Perhaps if more readers wrote letters of their dissatisfaction through the Reader Feedback, instead of under his article, Seeking Alpha would take notice. That's my humble opinion.

Fred

Starting to nibble at selected goldminers. Accumulating 50% position in AEM, GG, and RGLD. Will add on further weakness.

Loading up the truck on CNU, IPR and EVR. All are highly speculative with big daily swings. The first two are Sprott holdings. The third is a McEwen play.

Fred

Bill,
I'm starting to see some charts turning up for the last half hour or so in late day buying. (Around 11:30 PDT)
I wonder who is doing this buying and if it really holds any significance in light of three down days and the two previous indicating late buying, but the indices closing lower each day.

It works more like a trap to lure more buyers only to sell the next session.

whichever way you trade gold, you will NOT be right at least half the time...the periodic selling may or may not be orchestrated, but it isn't something anyone should expect to be able to time...a long-term core position is the only way to beat the system, whereas you have to live with being right AND being wrong in the short-term...if you believe in the long-term value of gold/oil (and i do), don't get side-tracked by the noise..

8heir:

GROW. There's a love/hate candidate if there ever was one.

i made some dough off the stock a year or two ago when it was in the low singles. One of those results for which a person would be delighted if they never looked at the stock again to see "the big fish that got away."

I've tried to get in once or twice since, but it throws me every time, and I am not that brave. Seems that it could fall a long way if it got it in its head to do so.

Re: IAMGOLD Corp. (IAG)

After being down almost 5% by noon, IAF has turned green.

Interesting move on a market down day with gold down $8.80.

8heir:

Oh, very well! I'll watch it again for awhile. I see what you mean.

Honestly, I need my head examined.

Looks like the late day buyers are not coming today.

Lelik--re NZDJPY chart.

The NZD just hit an all time 15 year high vs. the USD. I think there’s been a little profit taking and that is what you are seeing. Perhaps you were looking at it as a day or very short term trade. If you think you missed the boat, I disagree. Look at a two week, month or 3 month chart and you’ll see the NZD has come a long way recently vs. the JPY. With this chart above 90, I don’t see it unwinding yet, but it will. BOJ will raise rates someday. Japan is going to have food inflation if it hasn’t started already and that’s just one area of pressure. It’s pretty obvious the yen is undervalued vs. the USD and Euro.

I’m looking at initiating a position in FXY or the ETN equivalent in the near future.

2nd_ave,
I'm with you. I'm learning I need more skills, experience and capitalization to play in the gold futures playground. Thing is, it's so seductive, even as I get my butt handed to me I still am drawn. Like a moth...

But after a beating I like holing up in my room and fondling my metals. Mostly silver. It makes me feel better. Don't tell anyone I do that. It's kinda creepy even to myself.

;-)

Just kidding. But I do love those Australian Lunar 1 oz silver coins and I have a small addiction going on. Now when I look at something like a new flat panel TV I price it in ounces silver Lunar Dragons I can buy, or those ultra shiny Sunshine Minting 1 oz silver bars, and I put my credit card away.

My precioussssss....

Regards, all,

Mike
NYC

ALOHA !!

Okay, MORGAN and their antics aside, but I do not for a moment believe they are buying gold for any other purpose than to get out of "trouble"! Thats a lot of gold trouble ... $768milUSD!!! I believe some counterparty wanted their swapped or loaned "gold" back!! Of course we will never really know the truth not even by looking at MORGAN's quarterly!

So gold is taking a hit and the US Dollar(USDX) is appreciating, except in real life VALUE! IU consider the global currency exchanges, especially the USDX, much the same as the BLS job numbers ... Go figure !!!

Let me get this straight ... Lets say the FED raises a quarter point next meeting! YIKES !!! What a buying opportunity for bullion and PM shares! So now we have the stock market tanking and the real estate market crashing and if you DON'T believe the BLS reports(which I do not)unemployment rising. Let me translate ... WHERE'S THE TAX REVENUES COMING FROM? Without a stellar stock market and real estate there are no profits, not to mention corporate profits are down as well! As far as I know the IRS has not yet been able to tax "losses"!! The US government needs tax revenues otherwise, like pinball, "GAME OVER"! How much tax blood can you squeeze out of a debt laden US taxpayer turnip to support a severly debt laden US government? Especially a debt laden US government in a perma-$1trillion-war and baby-boomer's screaming "feed me"! Without tax revenues the US government will do what it is already doing which is PRINT MORE MONEY to pay bills! Makes perfect sense that the US Dollar on the USDX goes UP!There will be a day when the World will realize that NO currency is a safe harbor and GOLD will be the NEW global "go to" money! To extrapolate this concept into geometric proportions ... the US States are not allowed to print money of their own ... only the US Federal government ... therefore the US government will have to print money on "behalf" of the US States too debt laden to secure revenues via taxation. Get ready for a LOT more US States selling off infrastructure "assets" like land, roads and buildings to foreign government controlled corporations. This will be forced upon them by the Federal government in order to secure "freshly printed" money to keep the State capitals doors open another month! Of course the key word in this ponzi scheme is "CONFIDENCE" ... something ebbing as I type!

In the long run I believe that gold will be in NEW even STRONGER HANDS ... hands that are now engaged in "industrialization" on a grand scale and it is in their governemnt's best interest to become the new "reserve currency"! With that thought in mind ... at some point there will be no more gold or silver bullion to own(either due to supply deficits or government decree)and the next best thing will be quality mining shares.

THE BIG GLOBAL FIAT MONETARY SQUEEZE IS ON ... but this is the "squeeze" that is the underlying MOTHER of ALL squeezes yet "unseen"!

You will find nobody on Wall Street or the TV say that ... much less Cramer!!

Aloha Kaimu,
Guess what? I heard it on MNBC two days ago.
I will admit it was accidental and the person saying it was not your classic financial talking noggin from CNBC, but this nice U.S. Army General was discussing how on earth we were going to pay for all the troop build-ups and equipment to upgrade the armed services in light of the current fiscal situation.

His answer was short, sweet (to my golden ears) and easy, "We'll print more like we always do and have done in the past, we have no choice".

Do these PM dips bother me? LOL! NO, I have the military industrial complex, SS and medicare on my side. The game is simple. Reduce exposure to taxes and increase it on the gold/silver side.

The powers that be have no intention of stopping the presses.

Bill: What is Parick saying about Andean Resources and Wayne Hubert's efforts as well ? Let's say I am very interested in this tid bit! Maybe Wayne was event at lunch also...

ALOHA !!

Craig ... Was the General retired? Nice to hear an "insider" confirm it! I suggest people here read Richard Maybury on the US military and the complex that supports it! He has a "countdown" going on one of the two choices the US military will have to make soon ... either NUKE or DRAFT!! Did the General mention any inside military stuff like that?

The bottom line is that the average US citizen will be forced into a Third World lifestyle ... lousy infrastucture with power outages, food lines and all! Ask any Russian what thats like! You can be a SUPERPOWER and still have "food lines'! Has anbody here thought about that? We will have to revert back to a more communal and community-centric life where BIG government plays a lesser role. I mean once the US government can no longer afford to pay a liveable "welfare" wage ... then what? It was like that in the USSR ... only the top polit bureau Communists and bankers were the priviledged wealthy ... everyone else were in food lines and still are to some degree!! It is becoming like that here in the USA. That's what you get when there is no "middle class"(no tax base)!

Long PM and farmland ...

ALOHA !!

Oops I forgot ...

Long "OIL", pm and farmland ...

Kaimu,
I know I speak for a many burned little guys when I say I hope they were forced to cover! I wonder if they had borrowed some of that Spanish CB gold that just got sold.

Seriously, one thing I would like to know: We hear a LOT about central bank sales of gold. But we never hear about the counterparties. We know the Chinese, the Russians and the Khazaks, I think, all added to thir gold reserves, among others. But not to the degree it is being sold.

Where is all this Central bank gold going?!?!

Mike
NYC

What is HB&B mentioned from time to time on this blog?
Google search does not show anything meaningful.
Thanks.

HB&B: Humongous Bank and Broker
PTB: Powers that be
PM: Precious Metals
CIGA: Comrade in Golden Arms
CB: Central Banker

Bill,
Once you attach "Big Swinging Dicks" to HB&B, most folks know exactly what you mean!

Kaimu, Yes, the General was one of those retired guys hired as a consultant by MSNBC/CNBC. Nothing about more reliance on nukes, but that is simple logic if the military is going to have a small footprint ala Rumsfeld combined with the new free enterprise private version we have at lord knows what additional cost ala KBR, Blackrock?, etc. and zero accountability.

I don't know about you, but the downward spiral is already quite visible and the gap between those that have resources and those who don't or haven't had time to accumulate resources will grow at frightening proportions.

Even our friend George is buying in SA as it's clearly too spendy North of the Rio Grande.
Well, that and a few other reasons.

Chumbawamba's 'Tubthumping' is Gold's theme song for today.
http://www.youtube.com/watch?v=_lJIjdajBww

They can't keep it down forever.
(repost because of comment catcher)

MikeNYC. There are millions of people buying gold as never before. I buy gold monthly and have been doing so since I was 10. The Indians, Chinese and Middle East countries are buying everything the can get. The Chinese are going to buy 500 tons this year and all domestic production next year.

Paper money fades fast but gold lasts forever.

Just found a strange article about the movement of gold and where its going.Here is an excerpt from Newsmax today.

Since the first quarter of 2003, he added, "we've seen a broad range of Middle Easterners buying gold for storage outside the Middle East, the United States, Europe, or Japan. More people have bought gold over the past five years than in the entire history of mankind."

The main repositories of these new gold findings, Christian said, were Australian, Singapore, Malaysia, and Thailand.

The Fedaii organization also alleged that in a separate scheme, pro-Iranian Shiites in Iraq looted the Iraqi Central Bank and one of Saddam Hussein's palaces in the immediate aftermath of the 2003 war, and made off with 200 tons of Swiss-stamped gold bullion.

The Iraqi gold was re-melted in Iran, cast into automobile bumpers, and covered with chrome. Iranian agents drove the cars with the gold bumpers into Pakistan and Azerbaijan, where they sold the gold to brokers at a 15 percent discount, the group said.

"Sales of this gold are ongoing," sources at the OPFGI said

Craig,

Re " . . . a small footprint ala Rumsfeld combined with the new free enterprise private version we have at lord knows what additional cost ala KBR, Blackrock?, etc. and zero accountability."

Are you referring to the private military corporation, Blackwater, headquartered in NC and contracted by the US State Department for duty in Iraq?

long gold, short hope . . . .

Well, it is looking to me as if the party may be coming to an end even before the usual Fall selloff.
Just today on my Yahoo news site we had the following (paraphrased in some cases):
Rates on 30yr Mortgages jump, hitting new highs.
10 year treasury yield passes 5%.
Growth in consumer credit slows.
Retail sales weakening...again.
Home sales and prices to drop more sharply than expected. Expected by whom? Certainly not this community. That from the National Association of Realtors, the most biased, go go, spin operation around.
Oil prices rise.
Federal Mortgage Reform unlikely in 2007.
Gee, they say it might be "self correcting".
What isn't? The "correction" is once again going to screw the middle class dupes, and put $ in the pockets of those shamefully exploitive lenders.
Thanks guys.
Oh, and here's the gravy, multiple hedge funds are pissed at primary lenders or secondary mortgage portfolio holders for trying to renegotiate mortgage loans to avoid default and foreclosure. Not that these lenders are doing so out of the kindness of their heart, but these UNREGULATED hedge funds have bet on a big subprime meltdown and they resent any effort to keep them from getting THEIRS.
What will they do next?
What will we do next?
Stay tuned.

Long the Yen, short US markets via Ultra short ETFs, etc, long physical gold, hanging on to a few junior miners... sitting on the edge of my seat.
Long oil and a few oil service companies and broad based "soft" commodities: DBA.
But mostly short equities.
For god sakes don't follow my lead, trade against it.
Actually, just "listen to Bill" and do what your heart tells you to... and don't second guess.
Good luck all.

ALOHA !!

I find it very telling that the only "insiders" that dare to speak the truth any more are all retired! Retired generals speak out ... Greenspan ... CIA directors ... CEOs ... They either make a fortune on speaking circuits or write books! Better late than never I suppose, but how do these guys look themselves in the mirror every day as they go to work to lie and purposefully deceive the public! I would not want to be the immoral robotrons that put data together for the BLS, the FED, the GAO and the CIA. What a bunch of egotistical self-ritghtous pompous "sellouts"!! That's the lowest of the low!! I hope whatever paltry wage they were paid was worth it!! I mean ... is that the best you can do with your life? Oh, and by the way, thats yet another symptom of a decaying Empire!

MikeNYU: No need to explain, I know what you mean. I don't think the correlation of either GLD or XAU to movements in the equity market will hold beyond the short-term, so I have no vested interest in the broad market going up or down.

In 1929, the gold price was 20.67...in 1934, it was 35 69% higher). In 1966, average spot gold was 35.40...in 1980, it was 594.90 (1681% higher). In 2000, it was 272.65...in 2002 it was 342.75 (26% higher)...do you see a correlation there?

...sorry, I meant MikeNYC...

..and in 1934, it should read 35 (69% higher)...

...so maybe in times of economic depression, stagnation/inflation, and recession, people like holding a little gold...

and i don't plan to sell mine anytime soon.

Johojo,
Yes, Thank you, it was Blackwater. I knew it was Black-something kinda evil and poisonous sounding, Blackwater fits.

Kaimu,
Pretty nice, huh? These people use the system and are afraid to speak truth to power until they, like those they lie for, get theirs.

At least SOMEBODY had a great day in the market today: DYNCORP up 23% !!!!!

no, LOL here, just COL

(cryin' out loud)

ALOHA !!

I have been noticing the Aussie dollar blasting off like a rocket lately!!

HOLY COW !!! THAT'S IT !!! I have to call bloody Johnny and get it back down before JAN 2008 when I come for a "walkabout"!!! I can't be getting OZ "squat" for my valuable US Dollar! Haven't those dimbulbs ever heard the saying "the dollar's good as gold"?

Well, once again the currency exchange indexes ... weighted as they are ... have everyone buffaloed!

Here is a great link to AUSSIE DEBT ...
Link: http://debtdeflation.com/blogs

What is astounding is that in Australia private debt to GDP ratio is running around 153.9%, 14.6% over the past calendar year! Some Aussie mates I know are saying, "Yeah, I rekon inflation runs more closer to double digits, mate!" Of course Costello is handing out the same BS as Ben here, oh lets go with a 2.5%CPI!

When I lived in Perth in the 1970s I recall hardly anyone had or used credit. I also recall some healthy bank savings rates close to 18%, BUILDING SOCIETY, I believe they called them!

Any Aussies care to comment on the huge levels of "debt" in OZ? Also any Aussies want to advise me on how to stretch my miniscule yank buck? Perhaps I should bring a shovel and go dig out Kalgoorlie way for a day or two!! HA!!

Haven't seen this posted yet - there are some big things happening between Taiwan, China and Costa Rica.

Strange comments from a man who won the Nobel Peace Prize...

Costa Rica's President Oscar Arias blamed Taiwan's meager aid for the switch and warned the island would lose more allies unless it was more generous with its aid.
"I was always critical of the Taiwanese, and I can say now that I always told them ... if you want to have friends in the world, you should be more generous," he said.

He cited as an example Taiwan's US$20 million (¤14.9 million) aid offer to Haiti, arguing that the island should give "10 times that, US$200 million (¤148.5 million), because that's nothing to you, seeing the reserves you have.
"Considering the few friends they have, they don't treat them very well," Arias said of Taiwan, adding:

"Without a doubt, we will get more help from China."

http://tinyurl.com/2j3vj8

Apparently China broke out the chequebook with an "astronomical figure."

Couldn't you buy Haiti with $200 million dollars? You could with 100-1 leverage. :)

The China stock market lost more than $500 billion last week, and it would have been more if not for a 10% cap on daily losses.

http://tinyurl.com/2h8h8u

"The slide on the CSI 300 has erased about six weeks of gains worth more than $500 billion on the measure. That's more than the combined gross domestic products of Taiwan and Singapore. "
...
``It's a healthy correction,'' said Lei Wang, who helps manage $11 billion at Thornburg International Value Fund in Santa Fe, New Mexico. ``Now the new generation-investors learn something.''
...
``The selling has been going a bit too far, definitely exceeding what the government wanted to see,'' said Kang Saibo, an investment consultant at Fortis Haitong Investment Management Co. in Shanghai.

For reference sake, Haiti's GDP is just under $6B.

The US is setting up a red phone with China.

http://tinyurl.com/2sdej6

The United States and China are ready to set up a hotline between the Pentagon and PLA headquarters to ward off tensions and foster dialogue.

That is good news for peace in the Taiwan Strait: the Beijing leadership will at least expect U.S. restraint when pushing for reunification. It is bad news for the Taiwan independence movement, whose space of maneuverability will be further curtailed by this unprecedented Sino-U.S. strategic linkage.

...
During the three-day Dialogue at Singapore's Shangri-La Hotel, Zhang repeatedly stressed Beijing's peaceful defense posture and said the region had nothing to fear from Chinese military modernization.

He also used the occasion to refute a recent Pentagon report on the Chinese military's drastic expansion, calling it a "product of the Cold War mindset."

And on a particularly volatile issue, he was emphatic.

"Regarding the Taiwan issue, China will try everything including political, diplomatic, economic and even military means to defend the territorial integrity of China and prevent Taiwan's secession."

Don Coxe has been right on his canadian currency rising and the dollar falling. I have done well with FXC but am really looking for a negative to taking a swing with the Yen ( FXY ). In the event the yen trade unwinds it would propel FXY upwards. What if anything am I missing? Thanks read daily first post that may or may not get through lol.

Moon, I think I may be right behind you into the FXY.

I'm going to dump a non-performing silver company that seems more interested in producing shares, options and dilutions for insiders than actual silver (GPR.TO). It's a shame because it seemed to have promise. It's been languishing at 1.75 or so after issuing a second round of shares to insiders in less than 12 months. Then just two days ago it issued a ton of new options at 2.00. To me this looks like a negative drag on the share price if it ever does rise above 2. So I'm done with these guys for good.

Bill is right. Bet the jockey with these little mining companies. It seems Great Panther's jockey's can't keep their hands out of the cookie jar, er, feed bag, whatever. Too bad, because it seemed to have promise.

So I'm going to dump it and put the tiny bit of funds into the Yen ETF and, as they say, "set it and forget it" and wait for the unwinding. And I may put a little bit of it into Bill's gold flyer. (Do I insult whan I use that term? If so, please pardon me.) But I'm waiting for his write up. They seem, also, to have a lot of shares outstanding....

Regards all,
and take this beginners words with many, many grains of salt,

Mike
NYC

I hope Bill has some comments tomorrow on the LME nickel rule changes. It sure has Jason Hommel plenty worked up. I don't get how 'speculatin' can be blamed when physical nickel stocks are so low and usage is obviously sky high worldwide.

It seems like the shorts got caught swimming naked and the LME screwed everyone to preserve the big guys. If specs are being stupid they will pay like anyone else should. Same with the shorts. They should pay for their mistakes just like I do. These rule changes always seem to favor the short side.

Mike
NYC

I'm disappointed to read that, Wavesmash. It's a pity that Arias has strayed so far from the commitment to democracy that merited that Peace Prize. Money rules the world after all, but I wish Peace Prizes were awarded posthumously so that these disgraces could be avoided.

Not making any predictions for Freaky Friday, but just throwing out some data, mostly on ETFs. Hope somebody can use it.

www.ronsen.blogspot.com

Michael Pond of Barclays Investments just stated on Blooberg that they are looking for a 5.75 fed rate by year end with the Ten year @ about 5.40

Ron - Great blog posting with lots of good info. Thanks.