Barron's is reporting that Valero CFO selling 20% of his stake. 2nd sale this year.

Excellent reading, as every day, Bill. Thank you so much.

Bill Fleckenstein on SIV's:

"How anyone can look at the creation of this fund as anything other than a cynical way of moving an existing pile of crap from one place to another is beyond me. The fact that no one seems to think there is anything wrong with it (and I include the regulators) tells you just how 'fixed' the markets' problems are.

"The level of terror that must exist in the boardrooms of the banks and regulators that peered into Pandora's box this summer must be extreme. They set up the conduits to skirt balance-sheet constraints, and investors realized they were getting paid no-risk premium to buy the paper and fled. The answer? Do it again, in the same way, but call it something different."

http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/ASuperDuperBadLoanBailoutPlan.aspx

More on SIV's from Ivan Martchev:

"- but the poor individual investors are completely clueless. If they realized that the size of the problem is multiple times bigger than Enron and WorldCom combined, the broad stock market will be behaving very differently.

Maybe it is already."

http://attheselevels.com/

market direction-

no one really knows, of course...

not hearing much (so far) about buying the dip or ("friendly") comparisons to august 16...from a contrarian standpoint > may be good for another few % points down to sell into > followed by a serious bounce, at which point i would even consider going 60-80% short...

if we're going down from here, is the easy trade to go short and stay there until it turns around (someone here took a 50% QID position in his retirement account last week, which does not sound like a bad idea)...

if tops are processes and bottoms are points (todd harrison), will the "bottom" be easier to recognize than the top?

if, as bill mentions above, "half the world is in a Bull market and half has already started the Bear cycle," can you play the divergence (short old/long new) and turbo-charge your returns > instincts tell me a bad idea...

all said and done, will be happy with just a few percentage points more going short (compared to parking in cash)...

good luck to all next week...

Excellent Saturday chat Bill,

I would, as we get closer to the actual events, love to hear more explanation of what a "melt up" is exactly (a compelling term that I don't quite know the definition of).

Also let me say that now, finally (Friday) the market is beginning to reflect the sickness in the economies that we all know is there, putting the chances of a down market much higher than they were until yesterday. It's starting to act as it should act. It is such a tall glass of kool aid, this conventional wisdom that the china bubble CAN'T implode until after the olympics, that it's just IMPOSSIBLE that that could happen. I say the impossible is definitely possible. The very notion is absurd.

Chris

I wanted to alert readers to something that I found out today that is very disturbing. While we like to think that we have control over our money in our retirement accounts, we really do not. I have a significant part of my retirement currently in a cash reserve account--I'm in cash for my distrust of the market euphoria.

I read the link above noted by Bull Hunter. That there are some money markets that are exposed to this sort of crap I knew about. But, I did not think that MY money market had that exposure. Let me urge each of you to look at YOUR prospectus on your money market.

Now, here's the rub. When I called my broker, I was told that I was unable to create any sort of default other than the money market which had 80% in gov't and 20% in God knows what for my retirement accounts. Imagine my surprise that I could not have MY MONEY, MY CASH, in some sort of vehicle that earns NO INTEREST. I am shocked and disgusted. Perhaps I'm the last person on earth to know this, but in case I'm not, I'm letting each of you know as well. And, if you have a broker that allows your money just to sit in cash--safe and sound, then please post it here.

SiO2

You asked Friday about an automatic update checker for this blog so we all wouldn't have to keep hitting the reload button.

Well there are quite a few monitor programs out there, free and pay services / programs. I haven't tried any of these so no recommendations but some look very interesting.

Hope this gives you some ideas.

Web page monitors;

http://www.safe-install.com/programs/internet-owl.html
http://www.btinternet.com/~markwell/webmon/
http://www.ghacks.net/2007/05/09/monitor-websites-for-updates-with-firefox/
http://cybernetnews.com/2007/09/06/monitor-website-changes-in-firefox/

eom

Chris, my understanding is that a "melt up" is the final blow-off phase of a bull run, wherein prices are bid up to unsustainable levels.

Bill, I recall clearly that in late summer you predicted the run we would see in September, followed by the collapse in October. Well, we already know you were right on the first score, and now I am quite worried you are about to be proven correct on the second.

Paulsen's "roadshow" for the M-LEC stinks of desperation and, I believe, is ratcheting up the worry among market participants. Of course, this is exactly 180 degrees away from his intention.

I sold half my position in my short ETF Friday (too soon, as it turns out, and I give myself an "F" for that sale). But I set my profit target and, recognizing that I am definitely going to be wrong some of the time, I'd rather be disciplined when I am wrong rather than undisciplined when I am wrong.

I'd like to plug another blog that has been presenting some excellent technical analysis:

http://thechartpatterntrader.blogspot.com

Technically, the charts have been telling us exactly what Bill has been writing in his blog.

A good FT article about Paulsen's recent activity:

http://www.ft.com/cms/s/0/d9846788-7e6e-11dc-8fac-0000779fd2ac.html

Leisa, that you cannot move your money to a non-interest paying account is shocking. However, I suffer from a somewhat similar problem here in Canada in a couple of my accounts. The only alternative is to move a 100% gov. vehicles (things like TBill funds), those might be safe (hope Kaimu doesn't read this).
As for Money market, a couple of months ago here, Altamira here was deeply involved in troubles with ABCP. Because that was where I parked my money, I took it all out. Sure enough, after inspecting the prospectus (which I had to fight for), I discovered many investments in funny ABCP vehicles. The cash account, I was told, was government-guaranteed. Sure.

Quasi: thank you for the links. The Firefox extension seems the best of those if you use Firefox, but in the past I had a web page checker running to monitor Bill's site. The trouble is, you have to configure it daily because there is a new page daily, or configure it to check for the "number of comments" changed on the front page. It's too indirect, and I gave up. What would be really nice is a little app that automatically streams the comments. Kitco has a good idea to show live gold prices (sorry, no MACs), I am looking for something similar. It doesn't seem too hard, and it could be applicable to a vast number of blogging sites. Again, thank you for the links.

2nd,

As positive as I am that the markets will collapse, I can't help but think that QID could be a bumpy ride for awhile.

Tech is the last cock and bull story that HB&B has to tell. They'll be advising their clients to pull money from financials and industrials and put it to work in the big tech names.

I still hold lots of QID but am currently making my money in SKF. QID players will eventually be rewarded but maybe later than sooner.

All IMHO.

Best of luck to you.

"Leisa, that you cannot move your money to a non-interest paying account is shocking." I'm still so incensed I need vapors. I cannot remember the last time I was so angry over something. Pure, unrefined anger from not having control over MY ASSETS.

In my opinion Elliot Wave theory is truly the way to madness.

Question for Bill:

Back on 9/20, you mentioned that you foresee a cyclical top in Gold in the not-too-distant
future.

In your opinion, do you believe that this down cycle will be significant enough to exit Gold entirely, including physical coins, etc?

Would you see this Gold top coinciding with the general commodity top that accompanies the BRIC breakdown, or perhaps come even earlier?

I understand that your big picture view includes a new supercycle for Gold in the 2010-2012 timeframe.

Thanks for all your great work, what you are providing is incredibly valuable to the non-HBBB investor community.

Sitting here, trying to figure how the heck I can bend this analysis by Bill in a positive way, because it doesn't sound good for the U.S. Any help? Positive anyone?

"market direction? Why say, "no one really knows, of course..." ??!

With respect 2nd_ave, it is obvious to me."

thanks...sometimes big decisions hinge on conversational points (or affirmations) like that one...toyed with the idea of going 100% (actually, 200%) short last night and racking up the gains of a lifetime...

this blog has provided some of the best coaching and support for contrarian investors out there...reminds me a little of the voices that emerged in the sixties which went on to revolutionize music and writing...whereas here we have a nascent "anti-establishment" blogging community trying to even the playing field for investors...

"Positive anyone?"

Denny,

You could always watch Larry Kudlow & Co. They believe in the Goldilocks Economy.

j/k :^)

"Technically, the charts have been telling us exactly what Bill has been writing in his blog." I would also add that technically the charts were telling us this last year. Martin PRing and John Murphy two illustrious chartist. I don't say that to disparage them but merely point out NOTHING, technicals or fundamentals if fool proof in the marketplace. In fact, I remember Bill also calling for a top during T-giving and the market went on bounding upwards.

The market will do what the market does and 1/2 of the smartest of the smart money people (SOTSMP) will be right and 1/2 of SOTSMP's (I need a more elegant thingy here!) the smart people will be wrong. None of the SOTSMP's will right all of the time--and that is the most important thing to understand.

Whenever I feel too confident of my own dumb money assuredness I try to keep the above in mind.

Denny_Phelps -
I think (hope) there will be islands of prosperity in US economy even in a bear market. US companies that produce something of value for developing middle class in BRIC countries yet does not rely only on IP protection will do well. For example Intel / AMD will do OK since it is not trivial to copycat a microprocessor. Some other semiconductor companies that have complex in-house technology that is hard to steal will probably do well. Nuclear energy related business will likely see a revival. And the list can be continued.
I think we will see a major shift to a more balanced global economy in a next decade or so, but it does mean that US living standard will be lower on a relative scale.

"I don't say that to disparage them but merely point out NOTHING, technicals or fundamentals is fool proof in the marketplace. In fact, I remember Bill also calling for a top during T-giving and the market went on bounding upwards."

Absolutely true. In the end, charts are merely a tool for estimating probabilities about the future course of the market.

I think many of us know the feeling Leisa. We have to try to find a way to beat them at their own game. Three years ago I bought a small position in a 5-year locked-in fund there the capital is guaranteed but that was supposed to invest in the market too. Well, it turns out it has averaged a yearly return of 1.2%, and I have two more years to go of that junk. I feel like a complete idiot for lending them my money and not being able to get it out. But, who knows, maybe I will get lucky and be happy to have 100% of my money back. Also, every month I have no control over where or how my taxes are spent. I try to voice my concerns at election time, but every candidate I vote for loses. I am always voting against the idiots who are in power. Invariably they turn out to be idiots. So, I'll just try to ignore it and play the game, in the best honest way I can find. You can't win all the time, and that's fine.

Positive view:
We trade prices. Prices are going down....a lot.

We make money on the downside now.
That's positive.

When the train wreck stops moving we will be poised to buy into this mess and gain even more.
That's positive.

2nd, do you get Colin Twiggs TA reports? If not you need to check out the current post and charts.

Not a pretty technical picture.

Bill, having Macs I agree with you that it's all about Apple and how much money they can wring from you. It's a high price to pay for a good OS and no viruses (though in fairness, they are generous with the built-in software).

BH-thanks, I will put on some Kudlow tapes and play them until the depression lifts.

ALOHA !!

Leisa ... I wrote about that awhile back as well as an article on the FDIC. The FDIC can, if the road gets too bumpy, deem these SIVs as "fraud" and not cover your funds under their insurance. There have been past cases like that they refer to as the D'Oench Doctrine.

As soon as the first "junior miner" announced they were not being paid some $92mil out of the $203mil they had in short term paper I started wondering about my own short term cash. I extrapolated that if this is happening to "junior miners" teency companies, what must be going on at GM and Microsoft with their short term cash? So far it must either be well hidden or this has only affected mining companies short term cash and not the Fortune 500 guys! HA !!! Right!!!!

I prefer no interest and 98% safety to 5% and lost principal. My last CD matured on August 28th and I pulled my cash out of banks and into the Perth Mint cash account that pays no interest but is backed by both the Australian and the State of Western Australia and whatever gold and silver the mint may have at the time. It was the only place I knew that did not pay interest and therefore had no exposure to any of the ABCP or CDO or SIV cash viruses.

I bought stocks and liquidated my ETrade sweep account which only has $12.75 in it now. I moved another ETrade core account into Interactive Brokers(IB) about 2 months ago. I only have $1265 in the IB sweep account. Just enough to pay fees. I plan to keep the online broker sweep account cash to a minimum from here on out. I only have an annuity at Merrill Lynch now ... no cash!

I am wondering what would happen to all the banks if everybody did what I did? Maybe that is why this "liquidity" issue will have legs for some time to come. That would make CDs extinct!

What a brutally sad World when you're own CASH isn't even safe. Welcome to the future of FIAT !!

Leisa and others,

When I opened a registered retirement account here in Canada not so long ago, I was uncertain where I wanted to park the money. It was a contribution I made quite last minute to get the tax-deduction for the year. Apparently this was a sort of account which paid something far less than 1% interest, although I was not even told that it would give any interest when it was set up. It was to be a temporary account, but has been sitting there since. They call me once in a while to allocate it but I haven't done so yet. I wonder if you could open a second account like this one to just "park" some money, and then later on shift all your funds into this account? Another option, at worst, could you draw out the funds? Could there be a scenario where it would be more advantageous to do so than leave them there? You have certainly considered all sorts of options and these are just friendly thoughts from a community member. Best wishes all.

“Treasury Secretary Henry Paulson told the International Monetary Fund that its finances are ``unsustainable,'' urging officials to cut costs and narrow their work to ensure stability in global markets.”
http://tinyurl.com/2pmh96

This is the same guy who supports accelerating overspending by the U.S. government. The U.S. government spends irresponsibly and the U.S. economy is currently the most tenuous large economy in the world. Paulson needs to get his own house in order and that is where he should be focusing his energy.

Bill
Thank you so much for the link you posted the other day to Don Coxes article.

http://beearly.com/pdfFiles/BMO%20NB%20BP%20Oct%202007.pdf

A couple of weeks ago when I asked for some primers on the history of money I had no idea what I was asking for. I did get some good suggestions from the community. Thank you all.
But Mr. Coxes' article was exactly what I was looking for.

Today I feel that I have a better grasp of where we are because I have a greater understanding of where we came from.

Thanks again to one & all

"I feel like I'm stretched across the Grand Canyon with feet on both sides"

Be careful, Bill, someone might say you, too, have a wide stance!

I have asthma which restricts my "outside time" quite a bit, so I've read this blog for a long time and it's great. I feel like I know many of you and I really appreciate your comments. All of you are important to me and have entertained as well as informed me.

"Sitting here, trying to figure how the heck I can bend this analysis by Bill in a positive way, because it doesn't sound good for the U.S."

No need to bend the truth-we always reap what we sow. To me it will be good to see people giving up large monthly payments on the latest they couldn't really afford anyway and return to being fiscally responsible. For corporations, it never should have been all about engineering ST profits in order to line engineers' pockets. It's all good...

Again, Bill, good luck with your computer issues. FWIW, Microsoft released SP2 for XP awhile ago.

Microsoft actually has a schedule for how long they support "legacy" software. AFAIK, Microsoft will continue to be support XP for at least another few years.

In my work I use Windows 2000 and 2003 server and XP. I have Vista at home for play. But I continue to find XP more than adequate for my needs. Vista is cool, and as software is developed to take advantage of its superior graphics engine, I'm sure I'll find good reason to make the transition completely.

From an investment perspective, the next big O.S. release from Microsoft is Longhorn server. This is not as big a step forward as Windows 2000 to 2003, but it will in due course become the standard for Windows server software.

It cannot be overemphasized that having adequate memory, CPU and hard disk speed and capacity are the keys to solid computer performance, regardless of the O.S.

I try to stay away from the Mac v. Windows debate as it ultimately comes down to a matter of taste. It is definitely favored by those with a graphic design orientation. In my office, our user interface people are immediately recognized by their berets and Mac notebooks. The rest of use Windows exclusively because it is a superior software development platform.

I recently read a deadly combination of books & articles that reinforce Bill's warnings about who to trust, especially those in the greed-driven snake pit known as Wall Street. When you combine Bogel's 'Soul of Capitalism', Callahan's "The Cheating Culture' and Fordham Law Review's detailed look at the sub-prime corruption, you have to ask "who out there is actually trustworthy ?". And remember:just because it's 'legal', doesn't mean it's ethical.

Hello Leisa,
You are way beyond me in knowledge so I present this not only as suggestion to your MM predicament but also as a question.

Why not place the money in 3 month T-bills and then pay the small break fee if you need to access the funds before the 3 month period is up? The yield may be less but the saftey greater.

Tom

DUG?
QID?
DOG!?

M-LEC?
SIV?

PPT????

MAC?
PC?

RAM!

ALCS?
SOX!!!

Boy, I need to go outside for a walk.

Time for a stroll to Coogan's for a bite and some drinks.

Short?
Long?
Cash? (FXD?FXY?USD?)
PMs?

Crisis=opportunity=danger=rewards.

I sure have no clue where to put my tiny bets. I'm in cash and a little physical silver. It's probably where I'll be at the end of the day Monday, also.

But that doesn't mean I'm not going to be doing my homework, researching, building watch lists, looking for value. If I work and work and work, and can be smart and a little lucky, someday I'll be in a better position than I am today.

Good luck on Monday, all. I'll be parked in front of my PC Sunday evening, watching the Asian open. I'm sure I won't be alone in that.

This market is unpredictable and you must set up a plan and work-it. The risk/reward for betting the overall market index goes up from here short-term in negative after reviewing the Canadian stocks I follow. In time they will signal an intent to go up again. A lesson I have learned is that cash is king at times and now is one of those times - unless you understand and can trade puts which I don't. On September 28th in this blog I stated I sold off my shares and I would repeat the same today:

"Time to take something off the table:

What a month. Putting money back to work in the market in August paid off this month. Double-digit portfolio gains have me a bit worried here. My charts look like someone threw a tomato at the wall. My opinion is the market is overbought now. Sold SLW.to, WGI.to, ECU.v and HGU.to today. [My end of month portfolio adjustments] Now 90% cash and will take a look a putting back my hedge for a down market. Looking at TA [Technicals] has me in a fit. Doesn't look good and sometimes has me tilting towards greed that the market still goes up from here. Bill's heads up on the Financials is appreciated. Canadian banks may have a poor performance with those mystical loan holdings. Will look at the Financial ETF from Horizons for a down move when it comes.

Cash is king once again, waiting for the next trend so I can get back on the train."

We are now three weeks into the month and it has been refreshing not to watch day to day the stocks we get so excited about in this blog. Sometimes you need time away to reflect and look back. Friday was confirming of a possible down trend, but I am still waiting for a confirmation, some sign that the market sentiment has changed. There should, I hope, be time to take a position to benefit from a falling market.

As for Windows, I am an very conservative player. Windows 2000 with service pack 4 has been my mainstay. Last December I did buy a new computer with Windows XP-Service pack 2 - a top of the line HP computer with TV tuner that Staples almost paid me to buy. Reluctant as I was I only used it about 2 twice a month until about 2 weeks ago when I decided to make it my main computer. As a note to Bill, you can still buy Windows XP with service pack 2 to install on your computer. My local store has it in stock. There is a reluctance for us die-hards to use the latest and greatest (MSFT lost to us in getting the world to follow its flight plan. Some of us do live the unchallenged life). An iMAC with dual boot would suit your purposes. (And I might also look at that option too (buy an apple) as I like technical challenges) This December I will buy my first lap-top. It will also be an HP and the first thing I will to is isolate Windows Vista to a hidden partition never to be heard from for a while and install either Windows 2000 or XP. I just hope I can locate the drivers for the new hardware for the older O/S. And will Bill's adventure with APPL out on the web we can expect a major pull-back and 'crash' in the stock price. I think we have been just given a short-term sell on the stock. lol.

Have a great weekend everyone. Your discussions here sometimes makes me change my mind. What is has done is to make me challenge myself. [018]

Leisa,

You've probably already considered this, but Vanguard has an all-Treasury Money Market Fund. The downside is their brokerage charges $20 to $25 for most trades. In addition to safety, another upside is their fees and expenses are very low thus making their yields higher than most other fund companies.

Sec. Henry Paulson quoited on CNNmoney.com

"Fortunately, the global economy's underlying strengths should limit the negative effects that the turmoil might have on global activity," Paulson said at the annual meeting of the International Monetary Fund's policy-setting committee. "We need to learn from these events and take steps to address the policy issues that arise."

He said real growth is expected once again to be near 5 percent this year and next, with emerging markets such as China, India and Brazil providing over half that gain.

Why does this remind me of Kevin Bacons character in Animal House as he is being trampled by the crowed....."Remain calm....All is Well....

To Student:
Do you have links to any of those articles you mentioned?

Bill,

During a decade or so of consulting work in corporate media delivery systems I needed both Windows and Mac available--all the time. The most successful combo for me always has been to run Windows (I still prefer Windows 2000 Pro, which I still occasionally use in those moments where I absolutely must use a MS solution set) within its own window on a Mac laptop. Given enough memory, CPU power and disk storage you can have both running simultaneously all the time and easily drag and drop things from one OS into the other. Since Macs became Intel-based I'm told the Windows/Mac OS X duality has become even more formidable and readily achieved.

Also, don't overlook that Microsoft Office is available for Mac OS X, as well as for all versions of Windows.

Once you find the protocol solution that is just right for your needs, all the exasperations leading up to finally getting back to accomplishing fruitful work will become a faint memory.

Best of luck and thanks for all your generous efforts.

Anyone have any thoughts on how gold and the miners will do the next couple of days and also the coming the weeks, with people trying to exit the market like they did Friday?

Bill,

I am near certain you don't do this as your primary application, but one thing the Apples are great for is physically trading stocks, using the real-time intraday charts and all that stuff. Having done it both ways (pc and mac), I find the Apple to be superior for that application. In fact, I was just at the Apple store and they've got one like mine only about 3 foot wide and a foot and a half tall screen. God I wish I had that computer too. Oneofthesedays.

As you might imagine my outlook for stocks has shifted now that theyre acting more as they should. I am wondering if a "Black Monday" scenario this upcoming week is becoming inevitable. Any ideas about this week?

More charts...
More observations on Central Bankers...
Thoughts on Greenspan's book...(should have called it the age of intervention)
And a cleaned up site...

http://ronsen.blogspot.com/2007/10/hypotheses-it-is-what-it-is.html

Bill/All:

I had very little time to commit this past week towards finishing the Cara 100 Global back-test I started last week using the D,W,M RSI 7. I posted the Excel results for just a Daily scenario last weekend and I am hoping to post the results for the D,W,M RSI 7 soon. The latter is much more difficult for me to achieve for technical reasons that I can't explain here.

Bill, please know how much I appreciate all your efforts to maintain this blog. With all the maintenance, emails, $costs; I agree, it has to come from just being passionate about what you do.

Although getting a backtest done can seem like a never ending effort for me, I love the challenge.

On another subject, I'm curious to know is your opinion on the following signal described at:

http://www.marketsci.com/studies/20071018.01.html

I'm trying to back test this signal on my own to verify the results they claim, but I must admit I found it *very* compelling and thought it would be interesting to further discuss here.

onlineaces,

I pulled the following statements from the link you posted to marketsci.com. I am just a beginner in the markets but those kind of statements really get my goat. Maybe I need to read further on there website to understand because I just don't see why anyone would spend time on a sight that tells you up front that they have no intention of telling you anything they consider inportant.

BTW this is not an attack on you. I admire, respect & look forward to reading your post. I was just following your link when I read the statements below & they bug me. Thank goodness the people in this community don't feel the way the folks at marketsci.com do.

"As we've written many times before, we would never share anything that we would trade ourselves."

"We're going to keep toying with the idea, and as always (assuming we don't find something REALLY good), we'll be sharing it with you our readers."

Regarding money market funds: t-bills outright purchase is not an alternative, this is a qualified account--so the money needs to stay intact and within available vehicles. golen7, I'm just a student of this stuff like everyone else. The issue is the "default" account and "what" it defaults to. As Mrmockb notes, I can put the money in other US Gov't securities only mutual funds--but it requires a "trade" and more fees if it is non-Fidelity (plus there is a holding period).

Kaimu--are you a closet insurrectionist? . Thanks to all of you for your suggestions and for letting me vent.

I think Microsoft was surprised by the pushback against Vista but, here again Microsoft and their customers have different agendas.

The great growth days for Microsoft are past. Their major source of revenue is their current customer base. Vista has no reason to exist other than to force an expensive upgrade path on Microsoft's customer base. Customers, on the other hand, don't see much in Vista worth the hassle.

That said, Microsoft will win. They have a well tested buainess strategy called embrace, enhance, and extinguish.

For XP, that means Microsoft will continue to support XP (embrace). There is a service pack 3 in the works.

Service pack 3 and following fixes will include features from Vista (enhance). Eventually, XP will become Vista-lite.

Given a choice between Vista-lite and Vista, users will be moved to Vista. There won't be much of XP left anyway (extinguish).

Leisa,
Take out a sizeable loan from your 401K for some home inprovements or purchase of fire sale real estate. Then pay yourself back at 8%. I plan to do this shortly. The game is rigged and you have to be creative to pull one over on them. A sad solution but at least your money is working for you.

Lazarus, they are on the web as a business I think...

I was hoping to take this public info and perhaps put it to use and ask the *most* powerful computer I have at my disposal: Bill's network of blog posters here (or maybe even Bill himself).

Perhaps we can glean further some usefulness to this correlation between the Nasdaq 100 & Gold and even profit from it...

I think the minds in our network could ferret out if this correlation is worth adapting, without subscribing to their service. It seems simple enough to investigate on our own.

I believe Bill's "prime directive" here is to promote "social equity", and I'm only trying to further that effort by tapping into his social network here. It really is becoming a "super-computer" of sorts! At least for me...

I just found Bill's "prime-directive" in his About link on the main page:

"I believe in sovereignty of the individual and in our need to build and rely upon family and social networks in order to improve society and build "wealth" that includes, in addition to material wealth, a healthy lifestyle and bountiful social capital."
--Bill Cara

Hey, if HB&B can have their own network, why shouldn't we? Participate in your participation here!

shark - May I ask what software trading platform you use on the Mac?

I now use a windows laptop with a WUXGA screen (1900x1200 pixels)which makes charts Oh so sharp !

If Marketsci were to reveal their trading edge(s) in the web, especially narrow technical ones like these, how long would they have profits/customers? If Marketsci was running my money and blabbed about the niche they had identified, I'd probably look for a different manager.

I think the article is very interesting. It's sole purposed is to show that they are able to isolate and trade signals via discovering correlations between what would be thought of as non-correlating markets.

So they identify one that doesn't quite meet their standards but is still interesting and demonstrates their skills. What's the problem? They clearly state "here is an example of the kind of stuff we do, but better." It's an advertisement that is educational.

I read, enjoy and learn from the free 'Daily Wealth' newsletter without expecting the details of Steve Sjuggerude's pay newsletter, for example.

The one area I agree with you is in books on trading. I just re-read Elder's "Come In to My Trading Room" and there are techniques he clearly states are his proprietary developments that he doesn't like to give away, but he has a belief that a trading educator should not be holding stuff back in his books, so he lays it out. It turns out most traders don't have the discipline to use the stuff well, anyway. I wouldn't want to pay for a traders expertise and find he was holding stuff back so he could maintain an edge. Key word: pay.

Marketsci doesn't owe anybody their best detailed tech, except their paying customers.

As always, thanks for the website Bill. I hope that you are in good health.

Here is another blogger with brilliant insight into current market turmoil.

He usually posts things a few days before mainstream media catches on.

http://globaleconomicanalysis.blogspot.com/

Scottrade. The regular one not the elite.

Leisa,

Do not worry, just 9 or 10 more years & you will be 57-1/2 & will be able to PROBABLY remove your funds with no penalty.(I remember you posting your age). In the past I had an annuity that I got stuck with that had similar issues, but my passing of age cured the problem. You are completely correct about these MM funs sticking your cash in #@^%$*?? places. Recently I moved my MM fund into an all treasury based fund. I am really not too happy with that either considering the shape of the dollar. If you are the Perplexed Investor, I am probably the Disillusioned Investor these days.

On another topic, I have been using Colin Twiggs
charting service, & for someone who does not have a lot of experience at setting up these things I found his very easy to use & refer to it often to
get my RSI7 statistics in daily,weekly monthly
readings.

Vavoline6

TOPT

Is anyone following this one?

It sold off pretty hard last week. Shipping rates are down, so it started to drop before the late week bloodletting. Was the drop here overdone?

Their numbers come out 11/2 and it's not supposed to be a very good Q3. Q2 was good and they made big news investing in 3 new large ships this summer. This one might get hammered down below true value.

Watching.

Bill,

global replace in Pages '08: Command-F, pick simple or advanced (if you want to match a specific style or in a specific location in your document, plus other options).

I'm no Genius, so therefore the advice/help is free. ;-/)

Get Parallels or VMWare, install XP with SP2, have Windows in one monitor and the Mac on the other, copy and paste between systems, best of both worlds??

craig- re colin twiggs...thanks...

ALOHA !!

Leisa ... No ... just a realist in terms of trusting a government that has failed "We The People" consistantly for many decades now. It is hard for me to believe any government or central banks would get tough on inflation when that is where they derive their power. If the US and global financial fiat system really had any interest in controlling inflation we'd still be paying $0.35 for a gallon of gas!

My solution to reducing the effects of inflation has been simple. Buy a farm and grow your own food and fuel.

Retirement funds scare me. I have no faith that the government will want less taxes as I age. I don't sleep well knowing my funds for retirement are locked up in federal regulations and penalties all funneled into Wall Street casino chips. Pray to God you don't need those funds before retiring! Lots has been mentioned about Americans now using credit cards to make ends meet since their home equity ATM is tapped out, but few mention the coming wave of selling stocks/mutula funds and pulling cash out of retirement accounts to make ends meet. That is either next or already in PLAY!!

As I have said many times in the past I quit contributing many years ago and made my farm here in Hawaii my retirement account from which I attained total debt freedom. For me it was simple. Instead of tying up cash in a retirement account for the next 20 years I paid off my farm loan ...

So, here's my understanding. We will either have a slow decline like the '02, or a fast decline like '87. We should be able to recognize the final shoe by the yellow glitter. Alright. Are there any ideas for what to do while the shoes are dropping?

2nd_ave talked about shorting the market. This could work, but I think it could be influenced by allowing our dollar to drop in value. That could allow our market to fall without allowing a short position to be as profitable as hoped.

What other ideas are there to either defend our capital? or to improve our capital while everyone else is panicked? Some thoughts I've seen include plans for McD and WMT.

Any general ideas on what the lower range(didn't want to say 'bottom') will look/feel like?

Time to have another look at the old plans, and make changes where needed.

Kaimu,
You have an excellent plan for sure and we have the same one. There is nothing better than owning your own productive acreage without debt. With cash being worth less and less every day, as Paulson says how he supports a strong dollar; Ha!! Ha!!, and how everyone winks at how there's no inflation just makes me love my debt free farm even more.

Bill,
That post today was extraordinary. You are right on the money. I just don't have the guts to chase the china, india, brazil market at these levels. Even though I do think they could all go up alot more. Because just think about it, if a lot of capital comes out of The US and other topping markets where will it go? It won't just sit idle for sure. I would think that there will be a lot of money to be made with the correct bets in this next month's cycle. Thanks for everything Bill!!. Rob.

Mike:

TOPT - most (75%)of the institutional interest (17%)in this stock was acquired in the 2nd Q at prices between $4.5-$6. The chart currently looks ugly.

15% inside ownership and 5%in one hedge fund as of 6/30. Haven't seen the 9/30 institutional reports yet.

QMAR - IMO better company and seems to have held up well in the past week, but may have benefited from "management's exploring strategic alternatives" announcement on Tues.

Given the need to get food/fuel from source country to consumer/processing country and - if I recall correctly - an apparent log jam at the shipbuilders, perhaps the maritime shippers may be in line for some interesting consolidations.

At any rate your post jogged my memory and my interest. Thanks

2nd:

From yesterdays Stockcharts newsletter:

Richard Rhodes | The Rhodes Report
TECHNOLOGY REIGN COMING TO AN END?

Over the past 18-months, the technology sector has outperformed the S&P 500 by a rather handy amount; however, we believe this trend towards technology out-performance is very close to ending. This has major implications in terms of "rotation" to be undertaken by mutual and hedge funds as they are currently very very overweight technology; hence a period of "de-leveraging" themselves may create an opportunity to be short the sector as the "doorway narrows" as everyone attempts to get out at the very same time.

Technically speaking, we use the ratio between the S&P 500 "Spyders" and the NASDAQ 100 "Q's" (SPY:QQQQ). As the chart illustrates, a larger trading range has formed over the past 5-years, with prices now hard upon support at the 2.85 level - which also happens to be right at Fibonacci 38.2% retracement level. This important and critical support level in our opinion shall "hold" and provide for a rally back towards both the short-term 60-day moving average as well as longer-term 250-day moving average... if not higher. Quite simply, prices are oversold when one looks at the 28-day RSI level of 30.91, which is attempting to form a positive divergence with prices.

The most recent experience with an oversold RSI positive divergence occurred in early-2000 - which of course was "the top" of the technology bubble, and right before the onset of a recession. While we don't necessarily believe an exact "redux" is likely - the risk-reward dynamic does indicate that the risk is towards higher ratio prices rather than a continuation towards lower prices. Hence, we 'smell' an opportunity to be short a number of technology names in the days and weeks ahead.

- Richard Rhodes

Kaimu--yes I have no illusions of getting Social Security or Medicare! Regarding my retirement accounts, they are in brokerage funds which I'm able to invest as I see fit. At least I'm not in some "punk" 401k with lousy choices and no ability to take advantage of market declines.

Bill,

Congratulations on your WIR: I fully agree with it.

Just a comment: I think that since part of the late rally was pumped largely by only a few "Momentum Stocks" on the NDX, I suspect that the coming price falls on the NDX may accelerate faster than those on the SPX.

The Bear appears to be upon us.

Greeting from a deligtfuly sunny European afternoon.

The RSI data for the Cara 100 not included in the WIR can be found at http://www.tradersquest.de/cara100.html

Leisa,

I share your disgust for the money funds that ignore safety (fiduciary responsibility has become Wall Street gibberish for picking your pocket).

I had chosen Hussman's Strategic Growth Fund (fully hedged) as my alternative to retirement cash...not a recommendation, but his weekly commentary is scholarly and informative.

http://www.hussmanfunds.com/weeklyMarketComment.html

India: Bad news for SENSEX Monday morning
Communists want foreign investor notes banned. Their support is crucial for the Govt's survival

http://tinyurl.com/33wn8c

Shark - Do you still believe in "dow 15000 by two weeks before Christmas" ?

Ron,

Thanks for the Hussman link. His commentary from October 15th is quite sobering. Everyone in here should read it.

Around the middle of last week (Wed?), I turned the television on to catch the news while I continued to work on the computer. CNBC was on and Cramer was advising people on diversification. One caller had something like 40% in cash. Cramer said it was way too much unless your bearish and the caller should readily invest that money in the market. Wonder how the caller feels this weekend?

Leisa and Money funds. Share your concern. Without paperwork in front of me, I recall my brokerage allows one to choose from a few funds for cash holdings. One is a MM, another is U.S. Treasury bills, one is a muni fund, a couple are state specific muni funds and another is an AMT exempt muni fund. There may be more.

That said, I would not retain any IRA cash holdings in a muni fund as the tax savings don't make sense for that type of account. (But it does pay interest). Yes, if and when a recession hits, municpalities will be challenged (if they aren't already!) so it helps to know how many holdings are below AAA or AA and if there is insurance.

Disclosure: I use the AMT exempt fund in my regular taxable account because it works for my situation. Everyone has different needs.

vavoline6 . . . Leisa is younger than you think. She has more years to wait. Withdrawals w/o penalty begin at 59 1/2.

For those planning for the future, and those retirement costs....*please* look into what it costs for assisted living if you end up like many with some form of dimentia. It is very costly now and applying the 72 rule will show you what inflation will do to those costs.

As a start, basic assisted living presently starts at approx. $3000 a month. Will you be able to pay double (or more) this amount in a few years? Those limited to bed can run $10,000 per month. Unless you are off-the-scale wealthy, most middle class folks either transfer wealth to family BEFORE the five year medicare look-back period or they are forced to spend all their savings in home and retirement down until they are impoverished, (less than $2000) then medicare will take over.

Those young enough should either plan on saving and investing to cover these costs or look into long term care insurance.

Dear old Mom is in this situation and all she really has now is her home in So. Cal. which has already fallen in value about 10%. Granted homes are still spendy there, but I'm sorry, retiring on $500,000 and having to sell your home to do it, is not a great choice.

Look and plan well ahead.

Please, take my advice and listen to Kaimu and Bill. Get out of debt and save like mad.

disappointed to see so many headlines (eg, marketwatch) asking the same question...ideally it sets up a counter-intuitive open in the green, allowing longs to exit and shorts to open...if i try to put myself into a fully-invested frame of mind > prices may find support as investors all wait for a few minutes to see who blinks first...

also a possibility that the headlines are being timed > once the echoes of the '87 crash has everyone apprehensive, to be replaced by the headline equivalent of surf music into the dinner/bedtime/waking hours hours...

but mostly, disappointed i closed out 3/4 of my ultrashorts friday, and hoping for at least a few minutes monday to reload properly ;)

Craig,
Does it really matter where one is placed if one has moderate to severe dimentia? At that point it would seem that good placement is for those left behind that want the best affordable care for a loved one. I would definitely transfer my assets to my primary family and tell them to get me into state controlled care to limit costs. But that is just me. My living trust allows my wife to take any action she deems approiate. That goes both ways.

Bill,
In reading your comments in the WIR in the initial comments, its seems to ring true that the only way for unaware investors to limit his/her liability in the stock market is to do as Larry Kudlow/Peter Lynch preaches and that is to stay fully invested for the long haul to retirement. Larry was talking about October '87 in that regard. Unless "things are different this time". I am not a Kudlow fan by any means, but we all have family and friends that don't follow the markets that are invested. More than we wish. Even if one explained a short position they still would shake their heads mostly in disinterest. Right over the top. There seems to be a place for that investor using the "Kudlow method" and staying the course.

re buy-and-hold: sorry, i have to weigh in here against staying the course...

fund managers and financial advisers really need to amend the advice given to investors...when did being "unaware" become an acceptable basis for an investing philosophy (apart from the fact that fund mgrs have a vested interest in perpetuating that state of mind) > how did all these "over-protected" investors get through school, for crying out loud...the october '87 example makes the assumption that J6P would have bailed at the bottom (i don't think so); it conveniently leaves out the possibility that he may also have been smart enough to bail out in 2000 before the drop (many more probably would have were they not actively discouraged from doing so)...

I'm reading the Econoday report linked to at the top of the WIR. This jumped out at me:

"The striking thing about the global economy this year is how little it relies on the U.S. as the main engine of growth. For the first time in 2007, China's rapidly expanding economy has provided the largest contribution to global growth, while half the world's expansion over the past year has come from three countries ― China, India and Russia."

I understand from other sources that 60% (possible more, I need to dig up my references) of the Chinese production of US companies with outsourced Chinese factories is shipped BACK to the US for US consumption.

In that light, does the the statement about China being insulated from the US even hold up? Are they using simple production growth numbers withouth looking at the details of that production, like, for example, where does it end up?

I work with some Chinese products and they are better made and 25% cheaper than US or European examples. Due to that fact especially in the current environment, I am seeing more of my distributors bring their own knock offs from China to compete.

Dr. Brett Steenbarger is someone I respect a great deal. Today he has published an article on the indicator I spoke of in an earlier posting:

http://tinyurl.com/2vwue4

His next post will examine just such a possibility.
I'm eager to see what he reveals...

I have questions of two companies I wish our friends in Toronto could ask:

1. Of Great Western Minerals:

Your stock has languished at .40 (now down to about .35) for the past two years, during the greatest runup in commodity prices in recent history. When is your Rare Earth strategy going to pay off in a way that will result in meaningful share price movement? And if you can't tell me that, why should anyone stay invested in your company when their capital is drained by inflation every day?

2. Of Great Panther:

When will you stop enriching yourselves, at investor expense, with more option grants, every time the stock appears to make a move? Please explain the issuance of yet another round of option grants earlier this year, a mere 5 days before a favorable court decision came down (with resulting pop in share prices?) And as a supposedly low-cost silver producer with great properties, when will that actually be reflected in the share price in a meaningful way?

I buy the rare earth story, but it's been frustrating watching GWG do zero for so long. And Great Panther seems to border on criminality. I really wonder about the timing of that option grant. I wonder why there was no shareholder outcry over that one?

(I was long GP, but no longer, and have no position in GWG, other than one of the first companies I placed on my watch list.)

StockCharts.com interestingly illustrates a list of the 200 most popular stocks on their website. Right now based on intraday chart requests during the past 15 minutes, BMD (Birch Mountain Resources) is the largest symbol. The more popular the stock the larger it appears. You can click on any ticker symbol to see a SharpChart of that stock.

Check it out here:
http://stockcharts.com/charts/tickercloud.html

Is there any "news" worth reason BMD might be of interest right now? Quickly checking I could find anything...

Bill,
I understand the sentiment and the analysis indicatiing that a recession is just around the corner, or at our doorstep. I understood like every other sane person out there the stupidity of the sub prime mortgage market. I consider it to be the greatest theft (ponzi scheme) of all time. It is unbelievable how the Central Banks just walked in and picked up the tab, and will continue to do so in my opinion. It is a classic case of "if you owe the bank $1mil that you cannot pay back, you have a problem; if you owe the bank 1 trillion? they have a problem. I am not the most knowledgeable in assessing the technical or financial perspectives as you and many others on this board, but it does all make sense to me when I read it. All I can offer at this time as a positive if you can call it that is my own political perspective. Much like the $1mil & 1tril analogy with the Central Banks, I believe the USA's present position as the undisputed #1 World Power will force the other nations to maintain this ponzi scheme a litlle bit longer, maybe a lot longer, by adding more money into the mix they will pay off all the players... Might is Right. They will keep lending the USA money whether they like it or not, while they watch the dollar test new lows. American exports will sky rocket, jobs will be created, and maybe just maybe a soft landing could also be manufactured out of all this mess. American Dream or American Nightmare we are in for quite a ride. Thanks for all your insight Bill it is much appreciated. Cheers

http://theperplexedinvestor.blogspot.com/2007/10/irrational-optimism.html

One of my readers forwarded to me a paper called "Irrational Optimism". Rather than repeat and resupply the information, you can find some conversation about it at the above link. It supports the conversation here about the lurking dangers of "buy and hold" and speaks to how the tenets of that are not based on terribly sound statistical observations in terms of length and frequency of observation.

I hope that you will download the paper (link is provided). I think it is worth your time.

A bloody Monday predicted on the Market Ticker Blog. The technical analysis video is definitely worth watching:

http://tickervideo.org/eod-1019/eod-1019.html

Wow, an interesting set of news at Bloomberg right now, does someone want this market to go crashing?

- European Central Bank officials said food costs and record oil prices are fanning inflation pressures in the 13 euro nations, suggesting they may support further interest-rate increases.

- Vice President Dick Cheney said Iran faces ``serious consequences'' if it continues to pursue development of nuclear weapons.

- The dollar fell to an all-time low versus the euro and was the weakest in five weeks against the yen after the Group of Seven failed to address the U.S. currency's record decline at a meeting of finance officials.

- Deutsche Bank AG, Credit Suisse Group and other members of the Institute of International Finance stopped short of endorsing an $80 billion plan supported by the U.S. Treasury to revive the commercial paper market.

- China's economy probably expanded more than 11 percent for a third straight quarter, raising the likelihood of more interest-rate increases to prevent a flood of export cash from fueling asset bubbles.

- Chrysler LLC's contract with the United Auto Workers has been rejected by bigger union locals during the first three days of voting and supported by smaller groups, dimming prospects for the accord's approval.

onlineaces:

RE: BMD - the ever popular "exploring strategic alternatives" refrain.

- and, as of 6:39PM, QID is the most requested symbol on Ticker Cloud.

"an interesting set of news at Bloomberg right now, does someone want this market to go crashing?"

if the market has to crash, i'd be killing as many birds as i could with one stone...

Exactly what I thought 2nd, let it all pile together.

Simon A

Your link to the Market Ticker Blog.... Where can I access his technical analysis video each day? Could you post the link?

Thanks

"as of 6:39PM, QID is the most requested symbol on Ticker Cloud."

short trade is getting crowded...makes you wonder if the right trade would be to sell the ultrashorts and go long on a big gap down at the open...

I don't see any news stories about pre-market orders. That usually apears on the Sunday night Marketwatch headlines, doesn't it? Pre-market orders, S&P futures bets. Maybe it's just too early still.

Don't forget, Asia, being asleep on Friday, has not yet had a chance to participate in the sell-off. Watching.

Go Sox!

2nd_ave=BOS!

mike- as of 612pm, doesn't look bad at all:

S&P 500 DEC07 1502.00 -380
E-MINI DEC07 1502.00 -375
E-MINI MAR08 1511.25 B -400
NSDQ100 DEC07 2142.25 -750
E-NASDAQ DEC07 2142.25 -750

Pretty big gaps on the asian markets so far:
NKZ07(Nikkei225 DEC07) -500
APZ7(S&P/ASX 200 DEC07) -165

Can't wait to see the Hang Seng open!

Nikkei off 445 and USD heading for 76 handle.

Of Interest to QID players:

Herb Greenberg on over-ordering in tech

http://www.marketwatch.com/news/story/herb-greenberg-genuine-demand-over-ordering/story.aspx?guid=%7BC108EDBF%2D0505%2D4156%2D91DF%2DFC6649118767%7D&dist=hplatest

76 handle is not good.

http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

I really hope the market doesn't tank, not for myself, but for friends who probably don't have the sense to get out of the way. Including one who bought RIO at my mention at 17 (split adjusted - it was about 33, I think.) He and I need to have one more talk and then I wash my hands of it. He's one of those guys who can spend three days reading about some new MP3 player, but can't spend ten minutes reading about stocks he buys. But he's been in energy the past year or two and has done OK.

That said, if the market tanks, I will be watching and watching WGDFF for possible re-entry.

Why? DX at 76. And I think, for sure we get further cuts from the fed.

I clicked by Fox Business last night and there was some show with Cramer and a couple of the money ho's. They all seemed to think a full 100 basis point cut was a done deal. I don't know about that, and I'm not taking their word on it. I think there would be uproar in Europe, were that the case.

But I think we get cuts, at least .50% and then it's look out below for the buck. And gold being the anti-buck...

So come on, everybody! Sell me some cheap WGDFF! $2 sounds good. Maybe I should start talking it down on the boards....

Just kidding.

BTW, I mentioned Fox Business a couple of times, but I really don't watch it all that much. On my cable box it's right next to an actual high quality channel with integrity (Comedy Central) so sometimes I click in to see what they are saying. But each time the bile rises faster than the last time and I have to click away before I make like Linda Blair.

Re Gold:

Gold Cartel in action:

Look at how the initial vertical action was turned back. Even as the dollar keeps dropping. It's no wonder why Goldman spent a lot of money beefing up their gold trade on the TOCOMM last year.

http://www.kitco.com/charts/livegold.html

Lastly, Times Square is once again swarming with Brits and especially Irish. Shopping and spending and having a grand old time. I expect it to reach a fever pitch as we get closer to Christmas, like last year but even more. They look kinda like how I used to feel traveling in Canada and South America. Now I just stay at home, pay off debt and hope I don't lose my job. The worm turns....

Isaiah64v4:

Here is the link to the Market Ticker blog:

http://market-ticker.denninger.net/

It's worth reading but I don't believe he (Denninger) posts a video every day. Take a look at Brian Shannon at

http://www.alphatrends.blogspot.com/

if you want an excellent daily video with technical analysis.

Simon A.

As Si02 just posted the Nikkei is dropping fast, dwn 3% and still sliding at midday Monday.
On top of the foreign markets in deep red... Cheney is wagging his finger at anyone who will stand and listen to his rhetoric about his deep concerns on Iran's weapons of mass destruction!
Has there ever been a BLACK MONDAY anyone?

TOKYO, Oct 22 (Reuters) - Japan's benchmark Nikkei average and the broad TOPIX index tumbled more than 3 percent on Monday, battered by a strong yen and following a slide on Wall Street on Friday on concerns about the U.S. economy.

By 0018 GMT the Nikkei had fallen 3.04 percent, or 511.38 points to 16,302.99, just off a low for the day so far of 16,264.70.

The TOPIX had fallen 3.02 percent to 1,543.16. ((Reporting by Elaine Lies, editing by Rodney Joyce; Reuters Messaging: elaine.lies.reuters.com@reuters.net; +81-3432-8485; elaine.lies@reuters.com))

I'm not the only one. Here's the lead-in to the NY Times story on Fox Business. Too funny.

Talking Business
Ready or Not, Here Comes the Fox Business Network

By JOE NOCERA
Published: October 20, 2007

It was Thursday around 4:30, and I couldn’t take it anymore.

http://www.nytimes.com/2007/10/20/business/media/20nocera.html

Seems to be a lot of agreement here that the bull is over here (and I greatly respect the accuracy of Bill's calls over the last couple of years, so it probably is), but to give the bull side a listen, Santoli from Barron's is calling last week as follows:

"pulling back to view the action in context, what's most clear is that the indexes have pulled back a few percent after a straight-up, two-month rally whipped up too much frothy investor sentiment and got expectations too high for earnings season. This should nicely skim away a good deal of the short-term bullish froth that's been noted here the past couple of weeks, while raising the adrenaline level of the recently frustrated bear camp. These are positives."

Says need to watch when pullback hits 5% level to see if bulls come back and that, for now, bulls deserve the benefit of the doubt.

Simon A

Thanks my friend for the links!

MikeNYC -

Great Panther isn't exhibiting here at the Cambridge Show. (Sounds like voting with your feet was the right thing to do!)

I'll try to get to Great Western Minerals. From what (little) I know, rare earths haven't ALL moved ahead with the commodity boom (just a couple)I don't know whether Great Western claims to have those particular minerals. I'll ask.

Plus, the issue of Chinese 95% market dominance in rare earths overhangs prospects of all other would-be entrants. The Chinese don't always behave like free-market participants in these markets.

Jock

I would like to urge many here to check there emotions in at the door. I read this blog everday and have to say that the past few days the emotion is running wild.

I know many of you/us have been sanguine on the markets for a while but remember we are in the "fat tail" of the market where the possible daily and weekly outcomes become greater and more varied. The end of bull markets and end of bear markets are almost the most gut wrenching and difficult to judge.

It pains me to read the fear mongering and oturight bad advice being given here by some :) Taking money out of a 401k and then thinking you're pulling a fast one on the powers to be by paying yourself back is just not right.

I suffer from all the same mental and emotional investing mistakes as anyone else. I do want to caution though that with the current events, this site may help to perpetuate a homogenous way of thinking that could reinforce what we all "want" to believe.

I have known for quite some time that bearish thinking is so much more believalble due to the fact that those that think bearish make so much dang sense. The bulls really only have hope and faith on their side. Though the twins (hope and faith) are what has made humanity survive such catastrphic events and carry on lifetimes.

Please, don't take this as a insult to anyone here, Bill or the blog in general. My intent also is not to say that anyone is worng or I have a different opinion on current events. I only ask that discourse on making money continue, and the self feeding of gloom be balanced, opinions be diverse, and emotions be checked. Opinion seems to be all on the same side of the boat this weekend and this may be feeding the animal. When Sharkie goes from calling Dow 15k to "altering" his opinion in the course of 4 market days I think a gut check or all of us is in order :) How else are we going to help each other get through the turbulence?

Time for nerves of steel I tell ya. Goodnight from the Midwest.

Nikkei down 537 points at 10 P.M. EST.

Thanks, Jock.

I saw Great Panther listed on the web site for the show, but maybe with the stock in the dumpster they decided to stay home.

I had heard that the Chinese are tring to lock up the REE and restrict exports. That's what got me watching GWG.

I guess it goes both ways because of they have it all, they can tank the market at will.

Oh boy, East is painted RED.

Japan down 3.20%
HongK down 3.6%
China down 2.7%
S.Kor down 4.34%
Aus down 2%

geckojb,
That's a 'faith-based' post.

Frankly, I don't like being told what to post or how to shape the tone of my posts, but I'm going to let that part slide.

If you some sunny upbeat points to make, feel free.

The gloomy Gus'es here usually include details on what it is that's bothering them.

So...what is it you see out there that looks rosey? There ARE dark clouds gathering. The time to protect yourself IS coming.

That said, I'm not the only smart guy with a gloom and doom outlook to lose money buying puts on the broads, so there you are right. I learned my lesson - watch and play the prices, even though I see the cancer under the surface.

asian markets-

am i the only one who thinks the drops (up to this point) feel orchestrated > orderly and contained...the "controlled burn" makes it seem as if they can take it back up anytime they're ready...things need to get out of control before i have faith it gaps down here in the morning....

maybe i'm thinking too hard- isn't there something wrong with the way it's playing out...like a (bad) movie minus the suspense...if this were roulette i'd be placing at least one chip on futures turning green by morning...wouldn't be the first time 00 comes up when you least expect it ;)

"came up..."

2nd,

I had that orchestrated feeling on Friday morning when BubbleVision aired the "doozie of a recession" interview with Julian Robertson.

On the other hand, the controlled burn feel may just be necessary, incremental institutional selling, related to the credit problems they are having.

I still don't like the underpinnings of this market and remain solidly short.

Good luck to you.

NZD/JPY Carry Trade "tell" dipped sharply below 84 at open, but is now back up over 84.5 Has a ways to go to match August lows (76 area).

Fits the orchestration suggestion by 2nd, but it is early yet.

2nd, Maybe we'll go down for an hour or two Monday so CNBC can talk about how this looks like Black Monday redux. Then maybe up from there?

BH- don't disagree with your outlook at all...simply looking for a clue to playing monday's open...not as "solidly short" as you, and still looking (maybe hoping's a better word) for an opportunity to get there sooner rather than later...good luck to you as well..

Tim- maybe...if it does move up it will be a present...i cannot imagine a (plausible) scenario where it ends up being a bear trap...

This Is Your Brain on Money
by Laura Rowley

http://tinyurl.com/2meuyc

From Yahoo Finance, maybe already read but just in case, have a look.

PS: I expect to sell my GFI in the AM and not learn another lesson.

Greenspan: Current account 'not a huge problem'
Ex-Fed chief says adjustment needn't have an impact on real economy

http://tinyurl.com/26xrht

..........
"The housing bubble wasn't the Fed's fault, Greenspan said. "Central banks have lost control of the markets," he said. The Fed raised short-term rates in 2004, but mortgage rates didn't respond, he said. Global forces kept long-term rates low, fueling the housing boom, he said. The same pattern was seen in other countries, such as the United Kingdom and Spain, he said."
..........

Notes from the Cambridge Show:

Valgold's rep, when asked how they might fare better in Venezuela than KRY, named as their largest shareholder: Gustavo Cisneros, owner of Venevision (VZ's leading TV producer and broadcaster which did NOT get shut down!)Cisneros is also VZ's richest man. On Valgold's board is a Cisneros executive and past Pres. of the Venezuelan Mining Chamber, and Venezuela's Gold Association. Impressive!

Geologix' management also made a strong impression. Their Exploration VP was 20 years with BHP. Their CEO spent 4 years with Cominco, and 8 with Wheaton River, which he left very well rewarded. Geologix is to be the crown of his career. He knew the importance of highest-level contacts. He spoke of how to get the best out of his Latin geologists, and of the potential of his projects in Mexico and Peru. He had built two mines, and done lots of exploration in the region.

I am still a novice about mining, but I DO know how to work effectively with Latin American governments. Both the above companies were most impressive in this regard.

2nd,

I just watched the Hang Seng drop nearly a full percent within the last hour. And that is right before their close. All the Euro markets opened ~1.5% down. I'm not sure about a controlled burn. I think we'll know by this afternoon. Keep in mind a controlled burn only works when everyone involved is towing the line. If one entity blinks the controlled burn could start a forest fire.

Anybody out there looking into DIA Nov puts?

robboss, it would work, but I have not had good experiences with DIA, it's too easy to control and manipulate with only 30 stocks. I prefer IWM, XLF and a bunch of others. Juts my opinion. I usually plot a graph of several of them together and see which ones has performed the best or worst to make a decision. IWM is usually my no. 1 choice because of its liquidity and small spreads. Puts are a favorite of mine, but they are dangerous, if it goes down ~30% I sell.

I meant "it could work", not "it would work".

Gold trading looks so choppy.

SiO2:

Thanks for the comment. Essentially looking to hedge my QID position - so I will look into QQQQ puts instead. Also would be a put buyer on a strong intra-day reversal.

Robboss, QQQs are good too, but do you mean QQQ calls to hedge your QID? Are you looking to hedge or leverage? I think QID is ultrashort. Also, personally I hedge on different animals (like gold and QQQ or IWM for example). Just my unexpert opinion.

Speculation of US 50BP rate cut and Hong Kong depegging from the dollar and the dollar is UP .37 this AM?!?

Regarding buying puts in times like these: When the markets get jiggy, as they are now, and the VIX soars, puts become very expensive. Once the volatility declines, you could lose 20% or so just from a decline a volatility. Think of options as you would stocks--they become over and underpriced. Rather than buying puts, it might be a time to think about selling puts given the rich pricing.

With respect to options, I think that I'm still an unconscious incompetent--but I do understand the above aspect.

It was a pleasure meeting Bill & everyone else at the Cambridge House show yesterday. I learned a lot, though I liked the boat show better.

Wait and see what Monday brings, but after today I think I'd rather "invest" $20,000 in something with a big Mercury engine than something that spits out mercury into the environment. Though both could be depreciating assets, and both pollute the environment.

I will wait and get some BC stock after today's sale... :)

I was impressed with the Valgold rep's replies to my questions, and he seems to sincerely believe in the ventures they are planning down south. Their marketing material doesn't hide the ugly side of the mines - he tried to show that they will be better than the 10,000 armed Brazillians who have destroyed the environment there in the past.

His comments about Valgold being a Guyana play with a Venezuela option seems to suggest a bit limited risk, though the stock's lack of liquidity scares me a bit.

If we're betting on Venezuela, why not bet on HL, GFI, KRY, and VAL.V?

Oh wait.. Gold Fields sold out! who's left?

Rusoro Mining... any comments?

http://www.resourceinvestor.com/pebble.asp?relid=36526

I'm still curious to know how the Venezuela Bolivar (local abbrev. BS lol) will affect them. The Bs is doing worse than the USD in recent times.

http://tinyurl.com/3c2ss8

As for today's action in the markets, I blame it on people trying to hype gold at the gold show and more specifically Doug Casey's speech about doom, gloom, End Of The World, Greater Depression, etc. etc...

http://www.caseyresearch.com/

Apparently Canada won't exist in 40 years... and gold is going to $8000/oz? Perhaps... if the USD goes to $0.02... hockey moves to China, and Tim Hortons goes under lol.

But Gold's not going to $8k today... it's tied to the equity markets and looks like it will go down along with it.

http://tinyurl.com/3295ux

I'll probably stick with seeing Tony Robbins for my motivation over Doug Casey & James Turk.

SiO2:

Right you are - at/near the money calls to hedge; puts to play an intraday bounce up in the QQQQ today.

Leisa

Having/wanting no margin acct, I cannot write options nor short stocks. I too am an unconscious incompetent hence another value of this site (you, SiO2 and a host of others).

"FEDERAL RESERVE'S KROZNER SAYS CENTRAL BANK WILL ACT AS NEEDED TO SUPPORT MARKETS"

QQQQ- bid only 0.6% below friday's close..hardly a crash...adding to QID pre-market > if goal is to build a short position, would appear there is plenty of time..this morning's bid=whopping 3.3% off the year's high?

Goldman Sachs this morning: "Hide in Techs"

CFC- will open at a new 52-wk low...
Hide in tech? If I had to buy something, would be starting a position in metals...

We have like 5 large fires in our county, San Diego. Even in my semi rural community of Fallbrook. Two way highway country. Trading is not the main topic today if you live here. The fire is moving towards the Wild Animal Park.

Six separate fires now.

2nd,
Are ou still in DUG? I hope so.

I am still in SDS as I expect a test of 1400-1450. Nibbled on GLD this AM at 43.75.

2nd, I expect the Q's will hold steady pending Apple and Amazon reporting earnings.

I just pulled up the Micron (MU) chart this a.m. It's trading below book and will probably dip into single digits today. I'm no buyer in this market, but I'm going to keep it on my list this week just in case the selling gets too extreme.

UXG bid and ask at $4.05 ouch! I guess it can only go up from here! Cheers

stktrader, good luck to you. Be safe.

stktrader, good luck to you. Be safe.

craig- no, i'll have to re-establish the DUG and SMN positions...

MikeNYC,

I was afraid that the point of my post might be missed and taken the wrong way. I most likely feel the same way about the markets as you do. I think if you read my post it's more to the point of behavorial investor emotions rather than telling you what to post. No faith based missive here.

Look at dry shippers.
Oil tankers are getting killed and dry shippers are getting hauled in with them.

Many of these shippers pay big dividends and are contracted for several years forward.

QID- adding at 37.27...

Let's see how things look after the first hour or two. PMs look like they MAYBE firming bouncing off lows.

Had an alert fire and it looks like someone stole some NLR at 27.87; then it immediately bounced back up to the 39-40 area.

QID- to paraphrase bill, printing money at these prices (JMHO)....

Hedged QID position with QQQQ Dec 53 calls

now Mr. Market is playing it a little closer to his real personality...no scripted action, plenty of cross-currents and suspense...feeling better about the QID...

Exited DUG and added to KRY, UXG and GSS

jogyp- BOS belt just passed to you ;)
> good luck...

jogyp- BOS belt just passed to you ;)
> good luck...

Long IVAN KRY GSX all this morning
Hope the dow hangs on

This all seems too neat and orderly, but I'm not complaining.

Man THAT was fun!

Entered EGLE 27 (down 10%) and got stopped out with a trailing stop at 29.50.

Let's do it again!
I think you guys are right doubting this little rally. I'd use it to buy the ultras and maybe the PM's. I know the boat is tippy, but the USD can't win for long here.

SKF in the red.

Who's buying lenders at this stage of the game?

QID- OK, now i'm "solidly short" and ready to sit back...

Brimelow out with updates from Richard Russell and Harry Schultz:

tinyurl.com/2s4843

Excerpts-

Russell:

[Russell] commented on Friday's action: "A really ugly close ... You rarely see this- all 30 Dow stocks closed down. What brought this on? My guess the subprime situation is going to turn out much worse than first feared ... Look for the Fed to drop rates again. This will be bullish for gold."

For good measure, Russell offered this interpretation of oil's Point and Figure chart: "What we see here is very simple, a dramatic upside breakout with a target of 106."

Schultz:

On Sunday, the Internet-hostile Schultz took the very unusual (for him) step of sending out a special email alert "Friday's fall was not a fluke. It was serious selling, with stock futures SEEMINGLY set for a repeat on Monday, Oct. 22 another Black Monday. Nothing is certain in market projections but the RISKS here are too big to take chances, in our opinion ... We are canceling all buy orders at under-the-market prices in gold shares or any other shares, oil, commodities, industrial, whatever. This is not a great moment to be long of stocks."

Interestingly despite his long-term bullishness on gold, Schultz is not just selling his gold shares but shorting gold against his physical positions. He writes: "When stocks fall, speculators ALWAYS sell the things where they have profits to cover their margin calls which will hit Monday. And margin calls aside, in a panic market profits will be taken in fear of losing them in all areas ..."

not calling for one, but from a contrarian POV, the opening rally jacks up the the odds for Black Monday...

Bill arranged a meeting with Rob McEwan for readers at the Cambridge Resource Show. Don McKinnon (who found the Hemlo gold) and his impressive son Gordy (Baltic Resources) joined in.

McEwan radiates steel-trap-smart, tough, determined, out-of-the-box creative, outspoken, and accessible. We heard a virtual stream of (super-lucid) consciousness regarding UXG and his views about PM markets. Headlines:

- his frank press release expressing disappointment at drilling results was a public broadside at his own too-conventional geologists. He seemed unconcerned about the short-term impact upon UXG stock price. Wow! a

- he sounded likely to issue a "US Gold Challenge" (a la Goldcorp challenge)at some point. For the moment geologic data from the newly acquired properties are on paper or otherwise incompatible with UXG's data on core land.

- he believes gold companies moving for pure exploration to production enter a "show me" zone. If they disappoint, their shares go down.

- he is accumulating more properties around UXG's expanded core, but US regulation may slow their integration.

I've met more than a few top entrepreneurs in my day. McEwan is right up there. His most disarming qualitities:

- free-ranging ideas boldly and fearlessly expressed (from undersea mining - he feels it WILL become economic, to cultivated diamonds- vs. mined ones- he seemed to think most cultivated ones will go into higher-value military applications, not jewelry, and that mineable diamonds are super-plentifuful)with an almost youthful enthusiasm.

- he also issues frequent and clear reminders of his toughness as a CEO, and his sharp strategic mind.

In my experience, the above comprise a VERY unusual and powerful combination. Put him on CNBC or Fox, and I bet he'll soon be the talk of the town!

(I have no current position in UXG)

I forgot one point about McEwan. He said he put $100M of his own money into UXG. He takes neither salary nor stock options from UXG.

How about that for aligning his interest with ours as shareholders, MikeNYC and others !

Jock, thanks a lot for that report.

My head is spinning today, picked up a few more puts but still good cash position. Picked up UNG 38 Calls, I needed something uncorrelated with the market!

Gecko,
Sorry if I came across harsh. I should stop posting after midnight.

Regards,

Mike
NYC

Cara 100 TGP and its 6%+ divy is beginning to look attractive to me here.

I just can't bring myself to go long in this environment.

Energy and gold getting taken to the cleaners again. I'm not ruling out a 30% drop in HUI and 20% in energy for my own self.

"Who's buying lenders at this stage of the game?"

Traders and shorts covering, probably. Nothing goes up or down in a straight line.

Western Goldfields (WGDFF) was raced downhill today. Clearing out stops. Same with URZ. Both were gapped down on anemic volume.

jasper- taking a hiatus or still checking in?

Jock.... thanks for the great insight on McEwan and UXG...

Did McEwan say anything that they where currently working on, that might result in the stock going back up?

IVN has now retraced 50% of its move from the August low to its most recent high. When the dust settles, this is one on my shopping list.

The way the miners have been gapped down on no volume stinks to high heaven in my book.

One more post and I'm done for this a.m. - it should be noted that the SPX held its critical 1490 support today (so far). I think many traders are waiting for that particular dam to break before they concede the bear has arrived.

Dollar Rallies thus basic materials, commodities and PM's getting punched in the gut.

"Cara 100 TGP and its 6%+ divy is beginning to look attractive to me here.

I just can't bring myself to go long in this environment."
Posted by: Bull Hunter

Agree, more downside from present 32.10; monthly RSI7 still above 30. On the other hand, you could sell some 30 strike price Feb puts and let it come to you.

MikeNYC: No problem, yesterday it appears that I had punching bag written on my forehead yesterday. First I got cussed at by a driver while driving downtown, then a sporting goods clerk got sarcastic with me when I asked him to open another checkout lane when my two year old had about another minute before he tore the store apart as we waited in line for 10 minutes. It was just my day yesterday I guess.

Thanks for the good advice, Seamus.

"Turkish Troops, Weapons Head Toward Iraq"

CNBC says the Kurds have backed off. It's sad when your maket interestes have you rooting for war, isn't it?

Emotions are defintely extreme here. Just two weeks ago many were urging me to temper my bearishness and now everyone is fearing a crash.

I sold my SKF Friday and switched to DUG this morning on the rally - much better risk/reward. S&P 1490 here is a line in the sand. You may see sideways trading here for a while as traders battle over it. Next line is 1477 where the Fed eased in September. If that fails then the wizard has no clothes.

Now is the time to be putting together a shopping list as stock prices come to us.

Thanks Jock for the Cambridge update. McEwen's view that undersea mining will become possible lends support to my Nautilus Minerals position.

Appreciate the views on GIX and VAL as well.

emotions- they seem pretty restrained here...would guess most bets on bill's call have time horizons of several months > entry points into ultrashorts this week or next will not matter much when looking into the rearview mirror if/when the bear scenario plays out...

Junior Mine Stock Evaluation.

Please see the link to the spreadsheet for an evaluation of Firestone ventures, a junior mining company.

http://www.mediafire.com/?4lmdzj0xacb

I have added 2 new lines in the Due Diligence section. The first is a line to check to see if there are any ABCP issues with their finances. The second is a check for insider trading to determine if insiders are buying or selling. Thanks to Kaimu for these suggestions that he made a long time ago and I have been using since.

Note that this is not an endorsement for Firestone Ventures. I did own them and still think they have great potential, but did sell them recently to have more cash in my portfolio.

I have just published my regular weekly article highlighting some memorable / thought-provoking quotes from market commentators during the past week, and briefly reviewing the week’s market action on the basis of economic statistics and a few performance charts.

The link to the "words from the wise" is: http://investmentpostcards.wordpress.com/2007/10/21/words-from-the-wise-for-the-week-that-was-oct-15-to-21-2007/

jogyp- congrats, looks like the GSS/UXG entries are paying off....

Nice turnaround in stocks. Do I detect the work of the PPT?

Word has reached the Street that Bill Cara has defected to the Dark Side, sending AAPL shares to new heights.

QID players jumping from skyscrapers.

Oh the humanity! :^)

shark_attack

Simply 'mazin' what a $10B TOMO shot'll do for ya! Awaiting the 3:30 hijinxs. :)

HERO really wants to stay above that 25 level. I am waiting until the RSI comes above 30 but as long as it stays above that 25 support on its closing price I am loving the way this looks.

Speaking of AAPL, it's sitting between strike prices. The 175/170 earnings strangle requires 11.6% move by Nov. expiration to make it profitable. This is not bad, and considering the volatily it may work very well.

C175 $9.10 1 $191.70 10.49%
P170 $7.60 1 $153.30 -11.64%

Cara 100 BDK up almost 6% on Dividend and Share Repurchase announcements. This is after its daily and weekly RSI's both dipped below 30. No monthly dip though.

BH- really needed the QID crowd to thin out, or it just wasn't going down...

Craig,
Baltic Dry is at an all time high.

Crude shipping rates are in the cellar and many tankers have long idle periods between loads.

The shipper that caught my eye, TOPT, made news this summer by acquiring three CanalMax dry ships. Sounds good. But I looked at their entire fleet last night and it seems they have a lot of SuezMax and other oil tankers. Not so good.

I just picked up the WSJ today at lunch and they have a cover story on shipping rates and how high they are. The article mentions that Rio Tinto picked up a new dry bulk carrier and has four more coming soon, which they ordered back in 2004. Funny how the good companies just 'happen' to have things break their way?

The WSJ article did not mention oil shippers, but I found lots of articles last night talking about their woes.

Takeaway: Dry shippers are good. But check if they have exposure to crude shipping.

BTW, The Baltic being at an all time high is a bullish leading indicator, no? Then again it reflects rates and I bet part of the jump in rates are due to higher operating costs.

2nd,

If AAPL hits it out of the park, better don your parachute. :^)

BTW, I'm not a DayTrader. I'm in QID and SKF for the economic cycle. I'll be looking to add more QID, if and when AAPL sends the 100 rocketing.

Good luck to you, my friend.

Mike,

If you don't already follow them, check out the chart on DSX, my favorite dry bulker.

Good luck.

BH- no worries...if the Naz continues up, may follow through on that thought about going 200% short...

...the action this morning helps to allay anxiety about an orchestrated decline...market crashes do not happen on schedule...

Natty gas super cheap right now, loading up on UNG hoping the effects of this coldfront (and hopefully subsequent ones) bring up the price

Bull Hunter, SKF down is not so far-fetched when the PPT can buy in the market if they want to. That would be a great time to take gold down too, wouldn't it?

Thanks Mike!

I keep a few dry shippers on my watchlist (seeking cheap dividends). I saw a story on oil shippers on Bloomberg and combined that with EGLE being 10.43% down this AM after the open.
Since the market wasn't anywhere close to 10% down and I know about the oil shipper issue (and EGLE is contracted to ship iron ore for several years, no oil) I bought more than my usual initial buy.
Ran it up to 29.50, sold, it came back to 28.50, re-loaded 1/3 position and sold it at $30.

I would like it LT in the low 20's, but I made the dividend yield plus on the trade this AM so I can't complain.

Bull Hunter -

I have also added an ultrashort mini-wing to my trading portfolio with longer projected holding time (to capture slow-moving market downdraft at a close-to-cash yield).

Because so much anticipation has been built around AAPL's earnings tonight (and a bit for AMZN tomorrow) and in light of reactions to RIMM's earnings (I don't know what to make of GOOG too subdued probably b/c of options expirations), the interpretation and the ensuing spin should carry on the prevailing bullish streak for maybe one more quarter. While brick-and-mortal retail has been getting decimated, I am asked to believe that AMZN and AAPL will not suffer any blemish at Christmastime. Maybe, Maybe not... BTW, I cannot recall a highly anticipated event in the past year taking the bulls by surprise and frustrating their case. Too much at stake for the numbers not being right what the doctor ordered. Come on, GS advises to "hide in Tech"(!); highest beta, highest risks and this is a safe haven now.

On a connected subject, the market action looks so staged and contrived. It lacks the color, blood and guts of true crisis. Friday's sell-off was no buyer; not sell at all costs (except maybe the last hour). After a weekend of angst for the media, a threatening open, market gently bounces off the well-publicized supports (so critical I hear) and goes to retrace some the heavy losses. As Tim Knight has documented for IWM/RUT, Fibonacci retracements are working with such miraculous precision that one can but be admiring. When everything is textbook, the computers run the show. When a mess arises and the algorithms are not complete, then pay close, very close attention to the much-overwrought notion of a market message.

JML

Denny,

Like you and sharky, I smell the work of the PPT in today's market.

My question is: How long can they continue to hold this market together? Indefinately?

You can bet they started pouring money into the SP500 as it neared support levels. Not sure if the NASDAQ pop is PPT or upcoming AAPL earnings.

No-one in their right mind would be buying up the stocks of lenders, yet SKF is down over 2.5%.

We certainly don't have free capital markets when the PPT intervenes in them.

I smell nefarious forces at work (our Treasury Secretary, Mr. Goldman Sachs).

With regards to the references of the PPT holding the market, does HBB want Ben to cut interest rates or not? If I understood correctly what Bill has written, HBB needs lower rates to save their bacon. I don't think the market going up is going to help them achieve this objective. There seems to be conflicting conspiracy theories.

Anyone knows why gold has the flat segments today at Kitco?

Picked up some HOV puts, same I sold last week, bought back at half price - playing profits only.

Hunter, Seamus

Re: TGP

See this article, the link:

http://www.bloomberg.com/apps/news?pid=20601109&sid=aPz43np30Y9Q&refer=home

Long FRO

Si02,
The morning segment was a pricing error. When I woke up this morning and refreshed the chart (you guys think I'm kidding when I tell you I watch it obsessively?) there was a note from Kitco saying they had a price delivery problem.

There is usually a very small half hour flat segment after the Chicago close until the next market open picks it up. I don't know why there is a large flat segment now. Probably another glitch. Netdania is a more accurate source, but like you, I watch the Kitco chart.

Best link I know of for shipping.

Link: http://shipping.capitallink.com/

gotta jump.

SiO2, at the same time, until such time as the low rates arrive, isn't it important to keep confidence alive, so that people don't start getting "bizarre" thoughts about bank runs or the financial system crashing down. If you were in power, wouldn't you want to keep up the appearance of a healthy financial system?

ALOHA !!

MikeNYC ... My pick for dry bulk shippers is EuroSeas-ESEA. I bought at $8.35 last Christmas and sold at $17.25 recently. It is correcting and is on the oversold side now. Pays around 6% dividends and has some 18mil shares out with 40% institutional. They just announced a 16% dividend increase to $0.29 per share. They have 12 Panamax/HandyMax ships and a container ship. Surprise of surprises the company is owned by a wealthy Greek family and has been in operation for some 130 years now. Those Greeks really got the shipping biz all tied up!!

I also think the Iran risk factor is weighing on the crude shippers like VLCCF and FRO and the rest. I am not prepared to buy them becasue of that!

expect the unexpected...when it finally starts gapping down in earnest, we can all look back at how well the market played us...

It seems we are days away from a Turkish invasion of northern Iraq, which the New York Times in two news stories last week asserted (without quoting anyone) would never actually happen. I don't think the market will shake that event off too easily.

At the same time the drumbeat for war with Iran has been ratcheted up with Bush threatening WWIII last week if Iran doesn't do what he asks.

MU is not following the rally in chipmakers... Does anyone have any thoughts about this?

Telestar3d . . . thanks for the capital link (bookmarked it). . .very informative on the industry . . . . I have no shipping positions . . . interest is the Australia & Brazil to China ore shipments if & when opportunity beckons.

Hey Mike,

Didja get back into GSX? That little guy's a performer!

shark,
No, I didn't. Darnit. I think there must be some more good news coming out when they release in two weeks. Why else would it just turn around like that after six months of running into the toilet? I guess Friday would have been a good day to buy it back.

I'll keep my eyes open for chance to stick my toe in. Did you reload?

Office 2008 for Mac
Preorder + discount

http://www.macoffice2008.com/

+ another reason to use Microsoft OneNote... capture text data from any image on your screen.

http://sqlrs.blogspot.com/2007/10/simons-sql-server-stuff-ocr-for-free.html

Definitely reloaded at quadruple the size. That little guy showed moxy.

ValGold share purchase

According to CanadianInsider.com:

Oct 19/07 Oct 09/07 Pinetree Capital Ltd. Indirect Ownership Common Shares 10 - Acquisition in the public market 156,000 $0.380

FWIW, looks like Pinetree continues to like prospects here

Cara 100 RSI data: http://www.tradersquest.de/cara100.html

2nd - The BOS belt really belongs to you.
I am just trying to be a copycat. I exited UXG,KRY and GSS with small gains.

Went short on BUCY and JOYG this morning and that did not play out well. I wonder if Leisa is still short BUCY.

Added QID and SDS at the close. Dow's 45 point move after a 360 point drop is not that convincing. I am still looking for pullback. GOOG and EBAY results did not help Techs last week, lets see how APPL moves the market.

jogyp- added QID also, extended-hours...

reversion to the mean- we hear it all the time, but how often do we trade like we believe it? every time things get stretched out above or below, always snaps back (no exceptions i know of)...global markets are well above right now by any measure > reversion (even if we're talking about a rising mean) will necessitate not just a return to the mean, but going well below it...

i agree...think we're going down, and today's counter-intuitive move goes a long way towards erasing the skepticism i felt last night...almost all of my trades initially go against me before they take off in the direction i'm betting on (we've all had a few near-misses, i don't know anyone who has called the exact bottom/top)...we'll see...

MU
My experience lately has been:

Fake outs going higher, then, after several sessions going to darker lows, it rebounds to see day light beyond my last buy. Don't wait to sell at this point. Then it repeats.

Somewhat of a daytrader dream stock instead of a CARA 100 long term at this point.

Aussieontop
When I open your firestone ventures file i only get your explanination of what you are doing, not the info on the stock am I doing something wrong?

RE UXG,

Stopped by the gold show after lunch today and Rob McEwan was working the booth.

What he said is that the drill results in Nevada were "a standard Nevada mine", so there were some positives, but not what he was looking for. He is really gunning for a big one, a 10 million ounce hit like was found just north of him that will move the stock big time. He said that discovery added $3 billion in market cap to (I can't remember who's mine it was, but it was one of the majors). The press release was worded in the way it was to let people know that this is a risky business, so be prepared.

There continuing to drill and he's got 18 months of cash left, so he won't be going to the market for about a year.

As a fall back position, he also talked about a base metal ore sample that they have from a location near the edge of the property which had Silver, Lead, Zinc and Copper valued at $2,400 per ton. They are doing some more drilling here as he said that this type of resource is as good as a 3 ounce per tonne gold find.

2nd. and all,

Just in case you don't visit at TheStreet.com, here's the flavor of cool aid........

http://tinyurl.com/2v9y33

TheStreet.com Ratings Initiates Coverage on Nine ETFs, Three Closed-End Funds

Four of the ETFs earned our lowest possible rating of E-, or "very weak". All have one thing in common: they all target an inverse return of twice their specified index. In other words, negative 200% of the benchmark's return. The S&P 500, S&P MidCap 400, Dow Jones Industrial Average and NASDAQ-100 Index are all up for the year ending August 31, 2007. Accordingly, ProShares Ultra Short S&P 500 (SDS - Cramer's Take - #HYPERLINK "http://www.stockpickr.com/thestreet-symbol/SDS/"Stockpickr - Rating) lost 16.41%, ProShares Ultra Short MidCap 400 (MZZ - Cramer's Take - #HYPERLINK "http://www.stockpickr.com/thestreet-symbol/MZZ/"Stockpickr - Rating) sank 19.48%, ProShares Ultra Short Dow 30 (DXD - Cramer's Take - #HYPERLINK "http://www.stockpickr.com/thestreet-symbol/DXD/"Stockpickr - Rating) was slashed by 22.44% and ProShares Ultra Short QQQ (QID - Cramer's Take - #HYPERLINK "http://www.stockpickr.com/thestreet-symbol/QID/"Stockpickr - Rating) was chopped down by 32.66%.

A protracted bear market is not likely, so these funds should continue to be laggards.

If you are not interested in the mining conference that the Bill Cara team attended in Toronto - skip this long-winded and unedited commentary. I thought it would be brief, but it isn't.

Thanks jock, wavesmash, bb and others for your feedback from the Cambridge Resource Investment Conference. After attending I might say it was the "con" conference. Buyer beware.

Okay, I am a newbie to all this. Was impressed and I'll briefly give some comments tonight. I was indifferent in attending this show. I did not go last year. Why go to this show if these stocks would only be about 5 to 10% of my portfolio or if I was smart 0%. These are definitely not Cara 100 stocks. But I am not smart so my brain will probably convince me to buy them.

Got to the show in time to listen to Doug Casey at the Speaker Hall. Topic - The Greater Depression This Way Comes. After about 10 minutes I started to pray for the people of the United States. Jock gave you the details. I left determined to sell my house on Monday. Seems I have heard all of this before. As I was listening to this 25 minute presentation, I kept saying to myself "Who writes his material?". Somehow my brain kept thinking 'kaimu'.

I went over to the entrance and couldn't find Bill. Talked to the security guard. There wasn't a post-it board to indicate where you are meet people here. Everyone seems to have a "BlackWeary" or a cell phone. I don't think I will find Bill. So I walked to the Geologic Explorations booth and was listening to Mike Mallard talking about how they will run out of money by the second quarter next year when I got a nudge from 'joey' and when I turned around to say "stop pushing" I got the "Hi Bernard" greeting. We both went our ways looking for Bill. I walked around for 10 minutes surprised at the large number of exhibitors at the show. I am estimating that I have about 60 seconds with each one. When I came up the first aisle I bumped into the Cara group at the ValGold Resource display. Told Bill that I was selling my house, in jest, re Doug Casey presentation.

Then Bill, being the good mentor, brought me back to reality. Bill related that he and myself and the others are here to learn. But the exhibitors are here to work. It is not a vacation for them. This is business. And the speakers are here not for the fun of it. Some of them are paid to be here and they are beholden to certain interests. Take what I hear with this in mind was the lesson. Bill tells me he has no interest in these speakers or presenters. Some colourful language on this topic.

Not having enough of Doug Casey I left the group and went back for 25 minutes at his speaker workshop. This was a good question and answer session but he went to far to the extreme and it makes me shake my head. After the session I find Bill and the core researchers of the Cara team still talking at the ValGold booth. Bill then relates to me about stock promotion, short selling and the issuance of warrants to the promoters. Hmmm. Then one of the group wants to know when we are going to get a report from Tony in regards to KRY. Bill then says, well Tony is right there at the other booth near us and he calls him over. Well, Tony has been busy and hasn't been able to get it done. He goes on to state that it is a large deposit and the gold is there. A discussion of permitting and evaluation ensues after Tony leaves. My thoughts are that the people in the know who want to accumulate the stock without showing their cards want to drag it out a bit more until they have their 'share' of shares before there is an announcement. lol.

I depart again from the group and wander around. Stopped at the Khan Resources booth and spoke to Martin Quick. Tells me the mine is flooded and will have to be pumped out. The neighbouring property also was flooded by ground water but the mining firm has pumped it out. Looking at the display showing when the mine will be operational has got me worried. Will be a while before some cash flow comes in. Early days for this firm.

Chatted with the Excalibur Resources promoter. Early, early days here too. Stock listed on CNU exchange and trades at about 6 cents. This exchange only takes phone orders at present and commissions are out of this world I am told. Okay. Doug Casey mentioned in his presentation that 90% of the mines here will never see the light of day. You don't know who will be a winner. He stated he has an interest in -I think he said- 200 of them. Suggested that the audience do their 'due diligence'. Got the impression that we should not buy if we are sane.

Stopped by the US Gold exhibit and joked in a very straight manner that US Gold was on sale. Asked how long the sale would be on. The young gentleman smiled with me and then the rep there stepped in and explained what was going on with the project. Said I understood and she was a very pleasant person considering the slide in the company's share price. She did say that Mr McEwen was at the show and if I wanted to speak with him she would make arrangements for me to speak to him. I was impressed but declined the offer.

Went over to the Shore Gold display and spoke with a rep there. I am impressed because this is a diamond mine in Canada in the province of Saskatchewan. The story here is that exploration is almost done and there won't be any news out until the spring and I am given the indication that early next year there will be 'the big announcement'. Impressed that the government is fully behind the project and that it is on Crown Land. Process to extract the diamonds will not be harmful to environment. Program in place to hire natives from reserves for both mining and support - something that I want to see in a mine. Impressed with the people on board. I hope Bill can comment on the senior people here. Some new personnel on board have a diamond mining background from Africa and they felt that this was the place to be. Did not have a chance to speak with them. One of the engineers was presenting later in the day at a workshop.

Now after walking around I was getting tired and got a headache. Went over to the Speaker Hall to listen to the Panel for the debate on ABP/Currencies & the World. In looking for a seat, I see 'joey' and walk over to sit down for the debate. Well, there is no debate here. All four panelists are on the same side. Summary - be in gold. Best trades are in May and December. One panelist gives a figure of $850 to 873 this fall.

Next up is the Panel: Picking Winning Juniors:

Some junior names given out: Avalon Ventures [AVL-tsx.v] global warming play. Channel Resources [CHU-tsx.v] Ecuador. Geodex Minerals [GXM-tsx.v] New Brunswick Canada. Geologix Explorations [GIX-tsx.v]. Hawthorne Gold - [HGC-tsx.v]. Kettle River Resource [KRR-tsx.to]. MetalCORP Ltd - [MTC-tsx-v]. Pediment Exploration - Mexico [PEZ-tsx.v]. Romios Gold Resources [RG-tsx.v]. Did not visit most of these names, so I have no opinion. Just telling you what I heard.

After this presentation I chatted with 'joey' about the blog and trading. Then 'joey' sees Bill at the door to the Speaker Hall walking over to us. So we chatted for a while. Bill tells us a joke that another miner at the show told him and it was interesting but I won't repeat it. Tells us about his near death experience in a plane over Vermont when the plane was about to land in turbulence. You can search for the epic story in the blog. Then Bill tells us that team Cara are with Rob McEwen and do we want to come over. What a gentleman to seek us out. I confirm Jock's impression of this gentleman, Mr McEwen. Bill told me that most people in mining are focused about the specific field that they are experienced in. Don't ask them something outside this knowledge. I found this true when I went around the exhibits. I see the intensity in Mr McEwen.

Also I found the discussion between Rob and Bill about the difference in holding gold and gold stocks to be very informative. Actually the light bulb came on and I suddenly understood the message I missed. Gold stocks can go to zero and you have nothing. You can't use share certificates to buy something. But gold has a floor. It can't go below a certain value - say $600. So no matter what happens it will never become worthless. I am sure Bill can explain this better that I can. How come I was so dense not to understand the message?

Asked Mr McEwen about undersea mining. He was very positive on this topic (he looked at Nautilus Minerals but has not invested) but explained that the process has not been solved. I wanted to go off topic so I asked him about diamonds. He has something of interest to say on this topic (see jock's and bb's commentary). He explained that a lot of environmental damage has been done to the ocean floor dragging for diamonds - something I did not know. When someone asked him if he would sell off his US Gold shares to get into something else, he thought for a brief second and was quite resolute in saying no. That comment and his explanation of the story of US Gold gave me a very impressive image of the person and that if he can whip the geologists into finding it then we will see the stock go up from here. He affirms that the gold is there. There is a trend and other mining firms are on this trend and it will be found. I forget to tell Mr McEwen that his web site for US Gold is excellent. Lots of info on gold for interested parties on this site.

And then there is Bill waving at some other exhibitors at the next table who just sat down asking/telling them to come join us. Turns out to be Donald McKinnon and his son Gordon. Both are down to earth individuals. I am impressed again as we later talk to them about their project - Baltic Resources [BLR-tsx.v]. After the round table I am getting tired and looking forward to going home. Bill tells us, when the McKinnon's leave, that the exhibitors at the show are a small family and they know each other and there is a connection here. I sense that when I see Bill talking about the past and relating stories to us. Wow. Search the blog for more on this.

As I am leaving, Bill asks me if I will be back tomorrow. Wish I could because I think there is more to learn and see here. Alas I have to work tomorrow. If I come back next year I will be better prepared. At one booth an exhibitor asked me if I had any questions. I said "I wished I knew what questions to ask you".

When I got home Sunday night I did a search of the blog to refresh the stories Bill has written in the past - even to those days before I started reading the blog. These were just stories and unconnected people that I read about in this blog. Coming back from the show, there was whole new perspective. It was as if I read a book and then later I met the author and the author introduced me to the actual people in his book. It brings everything to life. Wow. [019]

Bill: edit/delete however you feel fit if I have misrepresented anything above. Thanks again Bill for an very informative day.

have a look, thought I was reading a Kaimu post...

http://tinyurl.com/39dyad

The report was mostly written by two German economists: Holger Schmieding, chief Europe economist for Bank of America, and Policy Exchange's chief economists Oliver Hartwich.

"We're two Germans who came to Britain believing its was a free-market haven and we're disturbed by what we've found. This is the year when the state sector in the UK as a share of GDP rises above the level in Germany. It's shocking," said Dr Hartwich.

Jumble,

Thanks for the reply on QID and the market.

Telestar3d,

Really appreciate the TGP story link.

Sorry for the late reply. I have a business that needs tended to by mid-afternoon and have to leave the house.

genie- thanks for the link...

unbelievable...

my take- the TSC ratings system shares a bias with many others that (IMO) can easily lead to under-performance: funds that have done well recently are ranked high, funds that perform poorly are ranked low...(ask yourself why these rankings are required to add the usual disclaimer about past performance being no guarantee of future returns)...

even more deceptive is then using this already-flawed system to rank the ultrashort ETFs -> which merely track the inverse of an index and involve no active management whatsoever...you might as well give the ocean an A+ for high tide and an F for low tide...

in fact, if we go back to the concept of reversion to the mean, i would argue that out-performance of an index over the past year should lead to increased odds of the inverse occuring going forward...

so after we finish applauding TSC for awarding the QID an F for past performance, why don't we get back to work and place our bets on future performance...

what's really irresponsible is the statement you quoted above: "A protracted bear market is not likely, so these funds should continue to be laggards." wow...is this the columnist's opinion? maybe he should add the helpful phrase "in my opinion," along with a statement about his track record...(personally, it shouldn't matter whether a bear market is protracted or not, as returns on the QID will be based on the depth, not the length, of the bear...of course, if you need to wait another 52 weeks before you rank the QID again->then maybe you need to add another disclaimer ;)...

"Banks to customers: Drop dead!!"

Just like Bill said, the banks are trying to save their own butts....to hell with the homeowners.

An excellent column from Jim Jubak:

http://articles.moneycentral.msn.com/Investing/JubaksJournal/WhollRescueHomeownersInTheHousingMess.aspx?page=1

BernardF,
Great post. Thank you. I'm jealous. I spent today rotting in my cube and you got to hang out with Bill at a gold show. (yeah, I had bad/dull/boring/mind numbing day at work today.)

Re your comment about gold and shares..

Gold = safety

Gold shares = leverage

They are so completely not even close to the same thing.

It's why I get confused/annoyed when people say they are in gold, but they are talking about HUI or shares in some miner or the philly gold index, and yet they hold no metal at all. Coming into all this from the metal side, it sounds strange. I filled my sock drawer with silver and some gold before I ever even bought my first shares of a miner.

Yes, gold (the metal) goes up when currencies devalue. But the main reason you have gold is to protect what you have against theft via currency debasement.

Then, in those times of serious. serious, kaimu-style trouble, gold does go up 4,5, 10 times, but gold shares (some of them) rocket to the moon on 100's or 1000's of percentages. You can see how it works if you research currency collapses.

These little miners you are looking at are lottery tickets, with all that goes along with it.

No guarantee it comes in, but when it does you are like Jed Clampett, off to Beverly Hills and a fancy new ceee-ment pond.

You tell 'em 2nd.

The whole thing about ranking the ultrashorts as poor performers when we are at the tail end of an inflation driven bubble is just insane and misleading.

To see what I mean by an inflation driven bubble:

http://www.dailywealth.com/archive/2007/oct/2007_oct_13.asp

IMHO, everyone needs to look at the chart at the bottom of this issue of the Daily Wealth. It's a comparison of the S&P priced in dollars, and the S&P priced in euros, since 2003. It's an eye opener and should also tell you why, if you think about it, gold has been so important during that same timeframe.

That chart kinda takes some of the air out of the whole 'bull' market experience of recent years.

'Bull' indeed.

GIX.V - Peter Grandich just mentioned GIX as one of his 3 top pix, and as "the single largest position he has ever held" in a junior. He cited John Kaiser's (kaiserbottomfish.com) estimate at the show today that GIX could go up ten to 20 times.

PS: Grandich was speaking on BNN.

C.note

I took my position a few months ago in MU again with an ACB of 11.54 ( bought with very expensive $CDN, as it turns out ) but I am a holder. This company has more intellectual property and patents than most others and we are riding a price war where only a few have any power. I believe that MU should remain a CARA 100 and this is definitely not a short-term play. I was right about SNDK ( bought in again Fri at 3:55PM) after "waiting for the stock to come to me" again. I think MU is being pushed to where it is in order to shake out the weak hands. Chip stats always look better in the fall ( pre-Christmas ) and then some good news happens to make them move. I see much better times here, even as Rome burns.