Could I actually make it as the first comment on Bill's board? We'll see...

Haven't done much in trading, mostly rotating into cash, but took a half position in UNG in hopes of natural gas + US$ bounce.

Looks like the round number 13,300 is providing some resistance, should make for an interesting day.

Good trading to you all!

Hi!

Is it my myopia, or is the NDX melting slowly?

:-)

Bill said..

"And your sense of humor, during a day that can best be summed up as challenging for the Bulls, reminds me of the usual chatter on professional trading desk, although somewhat better mannered."

There is no humor finer than a DARK humor!

I'm short LEN, CTX and went long SKF a few days ago Mr. Cara. I was concerned that the SKF rsi was just under 70 at the time but since the financials appear to be in meltdown yet denial mode I entered anyways. Yesterday was a very rewarding day in a plethora of wooden nickels way for me.

This afternoon I see my friendly tax lady to plan out how many wooden nickles to render back to Caesar.

I considered closing my position expecting a market rebound but apparently that isn't going to happen today.

Thank you for a great site. I enjoy profiting from learning.

I am getting increasingly concerned about yesterday's huge decline in US stocks. The Dow's 361-point decline is the third 360+ decline within a period of 14 days.

It looks as if we've reached the end of the party - a tipping point so as to speak. Today's action is not particularly encouraging either - another few down days will take us closer to a Dow Theory bear signal which will spell VERY BAD NEWS.

I've posted earlier (on the November 7 discource), but would like to hear comments on how you see the lie of the land.

The link to my latest story is: http://tinyurl.com/2lgqxo

Hi...Bill;

Bought your book online this am....

I thought I should contibute something

for your great insights...I'm actually

looking forward to dragging the Wizard

along with me on my out of town trips...

Cheering the Jockey's on.....

Thanx again Bill....

Cheers............DLB

I interested in other peoples' point of view on gold sector investments now. I sold my entire position (except some KRY) when gold hit $750, and then day traded a smaller position as gold ran to where it is today. (Thanks Bill for predicting this!!!) The question is what to do about the gold sector now. I've been waiting for one of those normal corrections to reenter. Bill has suggested a significant drop will come, and then gold will head higher again. I agree with this suggestion, but want to re-enter after a correction. Any opinions on this?

From an email I just sent to Senator Charles Schumer of New York:

Senator,

I am well aware that I am not one of your direct constituents, but as Chairman of the Joint Economic Committee of the United States, I AM directly impacted by your actions.

I felt it necessary to communicate my disdain and sheer appal at some of the statements you made in today's meeting with the Fed Chairman (which is not the first time I have heard your positions).

They are as follows:

"I do want to applaud you and the Federal Reserve Board for your aggressive, and I believe appropriate, response to this summer's liquidity crisis. It is vital that we maintain the health of our financial markets, and to ensure that they function smoothly, and you deserve credit for your prompt actions."

To commend the reckless, irresponsible action taken by the Fed to allow Wall Street a few extra paydays and a prolonging/escalation of the inevitable financial day of reckoning that will be coming is bewildering. Make no mistake, it is America that will pay the price of these and any other rate cuts. You/they have introduced moral hazard into the market where risks have only upside, with artifically mitigated consequences. The dollar gets destroyed, as do the investments of normal Americans, and noone learns their lessons. And this fiasco was not unanticipated - I have been awaiting it for nearly two years with the exact implications that have come to be realized. Perhaps, you should search the internet and discover the economic data that many others have relied upon to allow them to easily contradict the Fed's statements since the beginning of the year. You should be ashamed of that statement.

"I am glad to see that so much of your statement is given over to the importance of helping distressed subprime borrowers. You mention some of the efforts my colleagues and I have made, and I won't spend more time on that right now. But I will say that it would be nice if the Administration would join us in our attempts to protect American families from the fallout of the subprime lending disaster. The policy responses from the administration have not come close to matching the magnitude of the crisis. There is a lack of confidence that anyone is in charge. Mr. Chairman, if you feel that in your position you cannot speak publicly about the changes that are needed, then I urge you to speak privately to members of the administration. Use your position to jawbone them into action. Your predecessor was not shy about putting his prestige and credibility to work behind the scenes, and I encourage you to do the same."

It is unfathomable that you and others would leverage tax dollars to "bail out" homeowners who do not deserve to be in their home in the first place. Here's a question: If you can't afford something, why should you deserve to keep it? Should I now go out and buy the biggest, most luxurious houses and cars that I can get my hands on, and when I approach default, I get in line for my hand-out as well? After all, your policy discourages accountability and stokes the insatiable consumption that has put the US in this situation. Not to mention that for a Democratic Senator who is concerned with issues such as housing affordability, all your policy would do is artificially stabilize inflated, extremely overpriced housing, thereby preventing the housing market from re-achieving a level of homeostasis, which benefits the greater good. Since when did losing a house that you never should have been in absent of the greed of Wall St, mortgage brokers, etc., mean that you were homeless. What happened to renting?

Perhaps it is all political pandering to a base that you believe doesn't truly understand the consequences of your actions, but I and many others do. I strongly urge you to reconsider your positions, because I can promise you that this is something that will be closely watched by the masses.

I'm also interested in others' thoughts on specific home builders to buy once the bottom of the residential real estate market is reached. I would guess that it's right to buy in perhaps 6 months if one follows the old suggestion to "buy when there is blood in the streets." I am considering putting about 1/6th of my portfolio into homebuilders. Which ones do people recommend watching as the best possible candidates???

MikeNYC had some comments on commercial real estate being the next one to drop. I have a different concern. It is about protectionism and potential restraints imposed by government on repatriation of profits by investors. I think after Beijing 2008 the Chinese will show the Americans that they are now the dominant global power. Foreigners have far more invested in China, and when China goes protectionist, the US does too. Tit for tat. On the drop of the US dollar, as a bettin' man, I want stuff I can buy and move quickly like heavy equipment or specialized machines (trucks, backhoes, sensitive medical gear, for example take the trucks to the oil sands and mines of Canada and Mexico) that I can buy when the Greenback is weak and companies are going bankrupt. I want to be in and out quick, package it up and get it out of the US ASAP. That way, when the controls come in, maybe you take a hit on one shipment, not your entire fixed, relatively illiquid, real estate portfolio.

REPOST

Dr. Cosa, I definitely think that the theory of XAU vs. Gold as an indicator of advances in the mining shares is not really a solid one. The prediction was that since the XAU is rising, mining share will now outperform Gold prices, but this has not occurred.

Looking that the monthly chart of XAU vs. Gold, there are peaks and valleys, but no clear trends. The weekly shows better trends, but this does not guarantee the particular equity will perform with the indicator.

You only have short term nominal indicators of when the XAU is outperforming gold, so then at a peak. Gold/Silver ratio is a better indicator of a peak, but not a very good indicator of performance in the mining shares or ETFs.

For my gold junior, I compare the $US Gold price vs. the Loonie. Over the years, this company has underperformed my derivative index, except at the peaks.

http://www.flickr.com/photo_zoom.gne?id=1806819339&size=o

The 13-week MA is now crossing the 34 week MA, signifying an uptrend. So when Gold vs. CDW outperforms my gold junior, then the junior will eventually rally along with it, as long as developments continue to occur and news comes out.

http://www.flickr.com/photo_zoom.gne?id=1842698941&size=o

Eventually, the Loonie will readjust and the $US will stop undershooting, along with a steady gold price. This means that my gold junior will be very profitable. @$850, and an electrical grid hook up the IRR is ~50%. It may not be hemlo, but there is definitely a profitable company in the making.

Given seasonality being so influential in the last couple of years, really what are the odds we will see a price peak in the usual time frame, say in May?

Allen, my opinion is six months will be too early. I expect the bankruptcies to have started by then. Here the homebuilders are slashing prices per square foot and empty and foreclosed housing is everywhere. Existing home prices haven't started matching the builder discounts yet.

You might consider extending your timeframe.

Calculated Risk is an excellent blog that covers that sector and the financials.

At this time I think it's a crap shoot (applicable since I'm in Vegas) on who goes belly up and who doesn't.

TA Alert: DJIA breaks below 200 day MA eom.

Now why would MS be up? Perhaps the multi-billion dollar write-downs and $12B subprime junk declared on the BS were lower than expected? Maybe we are at such a point now.

Also wondering if C can drop to near zero once its level 2/3 is properly valued. I was thinking that JP Morgan would be next to declare losses, so it would be a good put candidate, but seeing MS going up I am not so sure.

Don't own C or MS, but still holding some MER puts till the last minute next week.

Took a small position in FXP this am, based on the FXI chart looking decidedly toppy, but not really ready to make a major bet against Chinese gamblers.

On real estate, I've made a little in the past on SRS, but think commercial real estate could be one of the main targets for sovereign funds - I remember the first oil shock when a lot of money flowed into London from the middle east - not to buy UK companies, just property - rumor has it they liked the weather!

WHat's driving the strength in Utilities today??

Allen, Bill warns us to use a system to decide when to buy a position. Most prominently discussed is the RSI indicator. If I were going into a sector, I have been warned to not "time" the bottom but to wait for signs of life. A long term rsi and moving averages looked at in the long term might indicate. It would seem to me that watching sector news would show accumulation by others. Thats out of my level of skill at this point. My system is to read Bill Cara, The Kirk Report, Roubini, Leisa, Prier, Dagnino and then try to see what they are saying in the charts. I miss bottoms if I use that approach. The operative word is "if". Getting into a stock is NO problem.My worry is to get out before that profit slips away.
peace from North Puget Sound
Gray

Well that's it. I closed out my long position hoping for a short squeeze. I still don't remember any time that the short ratio was this high and the market tanked but there's always a first time. Luckily, I gained 20% from just before the Sept rate cut until I moved into cash in the beginning of Oct. So, being in cash again I'm still holding on to a 16% gain since mid Sept. I was hoping for more but it's hard arguing with the market.

I may buy some puts but I'll probably just watch for awhile so I don't make another mistake.

Rob.

Wow Four Horseman just went decidely negative.

Hi,

I am considering shorting MSFT at these levels, hoping that the hudge "halo gap" is to be filled, buit I would like to hear opinions about this trade.

Thanks

AlanM,

Thank you for sending him that letter. We need to raise our voices.

Did anyone see the Cramer rant on New York AG Cuomo? I have some mixed feelings about it, but I lean on agreeing with Cramer. The way I see it is that these states had no problem whatsoever with these crazy practices as long as the money was flowing into the coffers. Now that the tide has turned and the free market is adjusting back to sanity, now's the time to get tough? Give me a break.

Seamus,
Did you mean FXI 176 line in the sand or 186?

Not sure but every test of the 200 day MA seems to be met with selling just like yesterday's 13,450 level.

Here's a worry from the back of my mind. Recently someone mentioned a Grandich item about the large commercial trader's net short position being so high and that they were being squeezed. Well, since they effectively represent CB's and HBB, I don't think they're going broke any time soon, so I think there may be an inclrease in margin requirements on the exchanges, curiously only affecting speculative positions, and probably coincidentally occurring worldwide. Could be the opportunity that allen is looking for, but it'll be a BOS trade to go enter after what will probably be quite a hit.

cyderman, not sure what you mean? Go long after the downdraft?

kry---ruter's maybe soooooooooooooon!!

Whew. I'm glad I got out when I did. Since then Dow down another 100 points and Nasdaq down another 30.

The question I'm asking is why now? Why not last week? What is different about yesterday and today than the other times we bounced off support besides the rule of 4.

The only two things I see are that China announced early Tuesday that they are diversifying to higher yielding currencies.

And Ben gave up the FED put today announcing that economic growth will slow more and there will be more defaults in housing.

But we already knew both of those things. Maybe HB&B were waiting to hear it directly from Ben.

Rob.

KRY

1400 plus 5.00 Nov Strike Calls in KRY TRADED for .05

3300 Calls Traded today 6 puts...

Cyderman -

I think Bill mentioned a few days ago to look out for margin requirements being raised as this is a tool to cause a selloff in gold. That would be a great opportunity to step in.

Traders are baling from AAPL, RIMM, BAIDU, and GOOG. Once energy rolls over, watch out, as that is the last area holding up the market.

Notice that the last two days are the first time the market has gone down and gold is up while Ben is speaking publicly. Traders are losing faith as the shear duplicity is hard for anyone to take.

I'm thinking that if we keep going down tomorrow, Monday has potential for being black, although there is last ditch support at 1420.

moab,
Thanks for the heads up on Bill's note. I've been on vacation, so I'll search for it in the archives.

JVS3, Photogrey, thanks for your comments. On the homebuilders, I like the hugely negative sentiment, and suspect with a general market correction, we'll see very attractive bottom prices. But where's the bottom; that's the question. It's typically when there is a real risk of bankruptcy in the sector, and one or two bankruptcies would trigger further selling. I'm not inclined to wait til the RSI breaks above 30 because by they, there will be siginficant appreciation. It happened with AHO, IF, AES and others that I've been willing to take a chance on. By the time they break above RSI 30, they double or triple in price. So the big questions in my mind are (1) which will go bankrupt, and (2) how long will the sector's prices take to recover. I don't mind buying something that I think is a good value and holding for 3 or 4 years. I think I'll just start reading more about both the sector and specific companies now, and see where we are in 6 months.

Re gold, it was very painful to watch the price go from $750 to where it is today after I had bailed out. I have a general tendency to buy early, wait a long time, and then sell before the manic upswing. With AHO and AES, I hit it right; with gold and Asian funds, I sold early, but still made great returns. However, I believe Bill's suggestion about a second upswing because of the fundamentals over the next year or two. So I'm just going to day trade positions in GLD, GG, GFI and SLW while waiting for a correction.

I don't know if all this is right, but all comments are welcome.....

Basketguy
Thanks for the KRY info - almost forgot I still have some.

1420 might go today if this keeps up!!!!

I've got tight stops on my two remaining mining longs - G and SLW. Also have a position in the double inverse XGD ETF. Longer term I think gold goes higher and the US$ continues to decline. Short term, $GOLD has RSI values on the daily/weekly/monthly in the range of 88-92. If the markets continue to decline as they are, margin calls will beget selling, kitchen sink included.

On Toronto, keeping an eye on the Bomber BBD.B, and the Cdn rails CP/CNR which are all looking oversold, but given their dependence on economic health, I think there's more downside to come. I'd also love to get back into some of the Cdn banks for the dividends, but I can't find my barge pole just yet. In the meantime, I have no problem whatsoever with T-bills.

Oooh, look at that, my G stop was hit. High-ho Silver Wheaton, my sole remainging long miner, notwithstanding KRY, which is in the sock drawer.

Question for the community: Are option volumes reflected in stock volume? I mean, when an option is bought or sold, does that increase the daily volume by 100? Been trying to better understand how volume effects stock price and didn't see any mention of this, so I assume it does but wanted verification. Tia

To the best of my knowledge, stock, option, and single-stock futures volumes are quite separate and distinct from one another.

Allen said:

" But where's the bottom; that's the question. It's typically when there is a real risk of bankruptcy in the sector, and one or two bankruptcies would trigger further selling. "

Seems to me just after the one or two bankruptcies is your entering point. In my opinion those one or two BK's will surely happen so it wouldn't be worth the risk to me of entering before then.

A couple of days ago the topic came up of getting second or more chances after missing a move. Another example is MPEL which is occasionally discuess here. I watched it closely when it was around $10-12, was too chicken to bite, and subsequently watched it shoot to $19.

Well, it's now back to $12.50 with daily RSI7 at 18. Just need to wait for rsi upturn and voila, second chance (if I've got the balls this time :)

Call me crazy but WM and C look kind of attractive to me right here. I bought a WM Dec 22.5 call today. Not putting much on the line here, but could have a nice payoff.

Ground Zero Eco Recon

This is my first wade into the discourse pool. I have been a sponge for several months, reading and learning. I have a day job, so I am unable to day trade. This information is from that job.
I have been in the auto parts business for over 20 years. This past month my plant had 5 customer weeks of downtime with the resultant ripple effect. One plant was down for two weeks and this one is especially disturbing for two reasons.

1)This model is still a puppy. Job 1 Is not even a year old. There has always been a honey moon period for new models. The loyal customer will typically wait for the new model and they support the first years sales.
2)The second reason is the type of vehicle. It is a medium duty truck. Not the type the yummy mummies buy for the displacement derby at your local sports field. These are more likely to be found full of class 8 tires, or purchased with double wide rear tires with a cherry picker or a twenty foot box with a roll up door used to delivery granite counter tops or raspberry bidets.

These vehicles are used by all sizes of businesses and it is disturbing that they sales are this soft. I was also told the other say that there will be another down week in December. This will have a huge impact on the entire supply base. If your plant has parts on this vehicle or any of the other plants that had down time, your spending “mentality” just did a 180.

Hopefully this helps all of you see more clearly what is really going on.

Thanks for all your insights. Now thing only thing I need is to find a why to explain to my children why they will be receiving Maple Leafs and Silver Wafers as gifts.

Anyone here made an investment in any of the furniture stocks? I know their business is bad, but a lot of them are trading way, way down under book value and I'm thinking any sort of good news could cause a good bounce.

Here's a few I'm looking at

Cost Plus CPWM - p/b 0.25
Bassett BSET - p/b 0.58
Natuzzi NTZ - p/b 0.47

An FYI [just to make you look a little smarter at your next social gathering]

Fuel figures

· The United States has 2 per cent of the world's oil reserves and consumes 25 per cent of its annual production.

· 98 per cent of all energy used for road, rail, ocean and aviation transport is provided by oil products.

· A barrel of oil is 42 US gallons, or 34.97 British gallons or 159 litres.

· It is thought there are between 1,000 and 2,000 billion barrels of oil left in the planet's reserves. The world produces 75,000 barrels a day.

· It would take a man working for 25,000 hours to generate the same amount of energy that is stored in one barrelful of oil.

Filler up?

bb, when did the furniture stocks top? I wonder if they are anticipating an economic slowdown?

away from the market all morning...what a rush, the one day i wasn't able to follow things at all...down 2.5% on my WM position, down 0.5% on UNG...watching QID run away from me (can't chase it here)...only consolation is being otherwise in cash, but i see even cash (at least in USD) is a losing position right now...hope everyone able to play is having a good day...

leisa and r. saunders thanks re Citi chart, I may be mistaken but I thought Citi almost went down in early 90's and no chart I can find goes back...Could be because they were seperate enties , Sandy Weill joined to companies together for Citi didn't he?

Craig--was out for awhile, just returned

186 is the line in the sand per P&F.

Double inverse FXP trading today.

Interesting to see that MS is up, but its Dec puts are also up. Looking for an entry into MS, JPM and C puts.

It looks to me like the Nasdaq has a broadening top formation on a one month and on a five month time frame. The one month has now resolved to spike down, which is the expected resolution. The five month one is looking ominous. Take a look.

Wow, the indexes are staging a huge recovery. Are people still buying dips? Or maybe it's the PPT at work. I noticed everything started recovering around 1:15 and all indexes started recovering at the same time. Maybe there's still hope for one more short squeeze. That would be just my luck having closed out my long positions. I have to try harder to do the opposite of what I think I should do because the opposite of what I think in turbulent times is usually correct.

Rob.

Bill---And wasn't the summer of 2006 when CNBC's Griffeth was pushing what a great time it was to buy a house--"no end in sight." That would be a great youTube piece to be playing now.

Anyone here have an opinion on CRDN and OSK? Both have been beaten down hard lately. CRDN guided lower and had some uncertainty in there forecast due to a govt bidding process that was ongoing. P/E on CRDN is nearing 10 on todays sell-off, the company has no debt and a solid cash position. And last time I checked that quagmire in the Middle East was nowhere close to fixing itself.

Finger Lakes -

The 1456 level is a fibonacci 61.8% retrace from the August low to the October high, so the bulls are stepping in at this level. We will see which way it goes from there.

I see some values out there but I am not going to step in front of this train. Everything is getting sold indiscriminately.

any links to technical sites with downside targets (or ranges) in mind for the indexes?

UNG- getting a few bids, now up 1%...

2nd ave...

1420 S&P 12900 DJIA That is what I have...Or what I have been looking for...

Been looking for a bounce above the AUG LOWS...

WE HAVE TO HAVE OUR SANTA CLAUS RALLY...YEAR END BONUSES MUST BE PAID ON WLL STREET..

PROUD PAPA.

I second what BILL said...

I went short MGM today via the JAN 70 PUTS for $1.05...

Gambling not high on the list when you can't pay your mortgage...A bottle of wild Turkey that's what will be sellin...

downhillfromhere,
Thanks for the info.

I did some consulting at a small company down in Birmingham that made cherry pickers. I wonder if they put them on your trucks?

Anyway, if you want to give silver as a gift, I suggest the Australian Lunars. For example, the Horse is beautiful and I know of at least one guy who gave one (some?) to a young girl and, well, you know how they are about horses. It went over very well. The other designs are very cool, too. The Dragon, the Tiger, etc. The 2 oz,if you can find them, are a little bigger and so nicer to look at. I have an extensive hoard of 1 oz lunars. And a kilo-bunny. I like them a lot.

I guess I'm assuming you are buying for gifts and not giving from your hoard.

In an unrelated note, Jim Flaherty sure sounds unhappy with the buck.

basketguy -

What about gambling to make money to pay your mortgage?

Moab,
I agree. I'm not stepping in front of this either. I want to buy calls on JASO as it reports tomorrow AM (look at what FSLR did today) but I'm scared that good news is quickly becoming bad news no matter what sector you're in.

Rob.

mikede--my monthly chart on C goes back to end of 1992, trading around 3 bucks then. I remember the saudi prince taking a huge position in C when everyone thought it was going down the tubes. al saud made a killing. I thought he bought at 9, so the 3 handle may be split adjusted.

Mikede,

Cannot provide the chart of C for you (Do not know how to post a chart on this blog but I could email it to you if you are so inclined), but my Investools access indicates that C hit a double bottom of somewhere between $3 and $4 in the 1990-1992 period. The 3-4 range is a guess as the chart is logarithmic and the double bottom occurs in the upper portion of the $0-$5 range.

FWIW it appears to have hit $1 around 1982. Gee, considering some of the comments on this blog, is this history repeating itself?

Hope this helps.

Hey 2nd. and all,

Guess what? I did not re-enter QID, as I planned to yesterday, so there, you got company.

But I sold my SDD @ 69.04 this Morning,no regrets,my cost was $63.75. So I'm feeling fine. Don't think THEY can let this go on again tomorrow but I been burned before and learned I can wait. Am waiting with a little ABX puts, won't hurt too much if it don't go my way.

Be careful out there. It's only money. Some of us can conjure it out of thin air!!!

I agree 100% Bill. I pointed out some peculiar trading the other day where the DOW rose 80 points in 3 minutes near the close after trending down the whole day. I guess they don't want a repeat of a sell off into the close like yesterday.
Take care,
BRendan

MOAB..

The guy that can't pay his mortgage
is the same guy that is maxed on his credit cards is the same guy driving the 800.00 month sports car...Is the same guy who goes to vegas to gamble...

At some point LIKE NOW..It all comes crashing down on you like a big wave...NO WAY OUT...
NO MORE $$$$$$$$

Anyone discouraged by the miners in Toronto today in light of the BHP RIO news. I remember when FCX made the offer for PD the miners went nuts for a week or 2.

KRY UPDATE

4131 Calls traded today 158 puts..

RE: gambling. This morning, at the grocery store, I saw an elderly woman in a tattered coat, feeding dollar after dollar into a lottery vending machine.

In light of the BHP - RIO news this morning i'm surprised that the BM miners in Toronto aren't putting in a better showing. I remember the miners going nuts for a couple weeks after FCX made the offer for PD.

Allen,
"Re gold, it was very painful to watch the price go from $750 to where it is today after I had bailed out. I have a general tendency to buy early, wait a long time, and then sell before the manic upswing."

When we are looking all those trades we made too soon, it is good to keep in mind that J P Morgan said he made all his money by selling too soon.

We should all do as well as J. P.!
Wayne

At some point the central bankers around the world have to step up and support our dollar..

From Rick Ackerman today...
China, which currently holds $1.43 trillion dollars in reserves, mostly in the form of U.S. Treasury or cash. Then there’s Japan, at $923 billion, followed by Taiwan ($263 billion), South Korea ($257 billion), and Russia ($400 billion). The biggest bag-holder of them all: Europe, whose cup runneth over with green confetti. How much of it? To borrow an accounting euphemism from McDonald’s, the EU holds “too many trillions to count.”

KEEP THOSE GOLD STOPS TIGHT RIGHT NOW...

I mentioned CHTR yesterday on my buy watch list. Bill mentioned this at 2.50. It was trading yesterday at 1.78, today it is 1.15. Could be considered for an initial position, do your DD. Lots of news on it today. Revenue grew 9.9 percent to $1.526 billion, has 5.7 million subscribers, lost a net 40,200 subscribers in the third quarter, but added 15,800 digital video customers. It also added another 53,000 high speed Internet subscribers and 102,300 phone customers.

Paul Allen (MSFT) may be selling the company or turning it private.

Hello all

cae inc of montreal reported 2nd qtr results today
sales up 25% profit rises to 38.9m...keeps it's cost's under control and reduces debt every qtr it's simulation products are in high demand globally and it's simulation training for pilots is on a roll..
does anybody follow this wonderfull global company and is it's current price of $12.20cdn justified????

thanks

Will the DOW and S&P close green today? Seems strangely possible

Talk about panic buying. Somebody wants to send a message that when Ben speaks the market waxes optimistic.

It was interesting that last night I got an email from Investment University in regards to Sothebys (BID) to the effect that they were telling subscribers to short the stock due to the lack of buyers in the market for fine art. They pointed to a problem with an auction in England. Today the stock drops in premarket from a high of 48 to 31. Previous close was 50.

O.K. MY ETARD YES ETARD account is frozen again...Can't Trade..

I AM LOGGING MY COMPLAINT...

2nd - Tim Knight @ SlopeOfHope posts downside targets & methodology
http://tinyurl.com/3db39z

craig/basketguy-

major whiplash- my kinda day, but not a day i was allowed to play...hope you both did well...

Basketguy:

"The guy who can't pay...." This is a rather simplistic view...

I may have told this one here before, but I can't recall: My uncle was an accountant in a wealthy CT town. Old money, people who give millions to Yale and Harvard when they die and who have owned Coke and IBM practically from their starts. You get the idea. One day he got a call from a large chain dept. store. One of his clients used to go around dresed like a bag lady, and she wanted to try on some fur coats. The manager wouldn't let her, and she asked him to call my uncle, her accountant.

His response: "She can buy your stores ten times over. Let her try on the damn coat."

You never know...

1

2nd ave..

closed out QQQQ puts 54 and 53 strike

@ 100% profit in less than 1 week...

My take...I think we will push higher Fri and Monday...Then I will be looking for a fall next Tuesday...Just the way I am playing this right now...

Gambling stocks often do well in bad times. For obvious and sad reasons.

Ok, that'll teach me. I didn't set a stop to lock in my profits in SKF before I went to the dentist. Just got back and now it's basically even for the day. That one little mistake just kept me from locking in an $800 profit.

If we test 1490 and fail, that's probably where the real fun will start.

moab -

Actually, the market threw a good tantrum when Ben did not sound as accommodating as hoped. Fed concerned with banks' stability, let's sell them off sillier than yesterday.

The action feels too predictable (again); as if traders/machines are looking to duplicate Mar./Aug. reversals to put a bottom in. Tim Knight pointed out a few Fib support coming into play for S&P500, Nasdaq & RUT earlier this afternoon. Dow 200dma is around 13,200, I believe.

As I mentioned before, I increasingly feel that trading is under the control of the machines that operate with TA models at their core, hence the eerie rebounds/reversals at precise Fib levels for indices and stocks.

What I love most is the market coming back with oil leading or in tow (I haven't figure this one out). Since the oil trade is widely advertised as speculative, market move up with same sentiment (?).

JML

Golfer,

Simplistic Yes, I was just trying to get the point accross that debt is like riding a wave..

It builds and builds and builds then CRASH...

It all comes to an end all at once..I hope this helps to clarify..

My father-in-Law owns a tool and Die business has not been doing well for years..He keeps putting more and more of his personal money into the business..The wave for him has been growing and it is not getting any better..I have tried to help, but there is only so much I can do..Last year his takehome pay was 2000.00. Yes 2000.00 for the whole year ...At some point what needs to happen the WAVE NEEDS TO CRASH..Then things will clear for him and hopefully our family..

NTES reentry , buy stop at 19.50 looks promising; positive money flow mostly from block trades

stktrader,
The NY papers had an article about the art market collapsing about a day or two ago.

It seems the bonus babies on Wall St. (And Water and Spring) liked to pay the crazy amounts, particularly for modern art. Except for Goldman, which I think just allocated about 16.5 Billion for bonuses, more than last years obscene tally, those guys are starting to sweat what the bonus pools will look like. And so are the ones who feed off them.

OG- thanks for the link

FXP- volume > 500,000 on opening day...
EEV- volume > 1m

2nd,
Traded FXI, first a loss then a slightly better profit. Also WGW @3.77 in the midst of the selling (what the heck) and it closed @ 3.93.

Got into SDS early and sold just at the start of the closing rebound for a few hundred profit. I was expecting a fight at the close so sold while the getting was good.

Bought EGLE at 27 + and sold it for 29+ before it got hit again. I expect it will go up $10 now, or since we are still below support, sell again. Overall not a bad trading day but not holding anything but a couple thousand WGW and cash. I'll probably regret selling the FXI tomorrow AM, but a profit is a profit in this crazy volatility and I'm leaving anything lying around.

Ooops...I'm *NOT* leaving anything lying around (on the tsble).

Wayne....

"When we are looking all those trades we made too soon, it is good to keep in mind that J P Morgan said he made all his money by selling too soon."

I like that one Wayne. I'll post that on top of my monitor.

Market summary has Put/Call ratio at 1.24.

Brazil---EWZ---P&F pattern: Bullish Triangle Breakout

http://tinyurl.com/2h5q25

Mostly in cash with a few positions remaining. Heading to the airport tonight enroute to Massachusetts. Plan on returning to the markets on Tuesday. Be careful out there; it will come to you if you wait. Best of luck!

And thank you Bill!

Petrobras up 16%. "Brazil has discovered huge new petroleum reserves in its south..." If one of the deposits turns out to be as vast as it appears, Brazil will be in the same league "as the Arab countries, Venezuela and others," "Petrobras, Brazil's national oil company, said in a statement that exploration of its Tupi field offshore Sao Paulo state revealed it could produce up to eight billion barrels of light oil and natural gas." http://tinyurl.com/2en6xc

Question on CAE

I estimate this fiscal years earnings (30 April 2008) at 0.625 giving a P/E of 20 at todays price of 12.50.I think they can increase diluted earnings per share by at least 25% over the next few years giving a PEG of 20/25= 0.8 which means CAE is slightly undervalued at this price.
CAE has a good backlog and leading a group of companies sole source bidding on a large Canadian Goverment contract.CAE has had largly international sales over the last several decades so hedge currecies appropriately.
Do your own due diligence.
Cheers

Good for them. I guess now they can tell Morales to stuff it.

stktrders puts will be looking good.

"Be careful out there; it will come to you if you wait."

seamus- great advice...hard not to chase prices in this kind of mkt, but you're absolutely right- it always comes to you at some point..

"I'll probably regret selling the FXI tomorrow AM, but a profit is a profit in this crazy volatility and I'm not leaving anything lying around."

craig- impossible NOT to have regrets every hour in this mkt...i see keeping overnight positions small or finishing each day flat as safer than betting big on direction...

I rang the cash register today, too. As others have said, this market is for traders or those with a lot of patience and boat load of confidence.

Re KRY, I actually made a few $$ on this as a day trade. What caused me to sell was news of protests in VZ from students opposing Chavez's power grab.

That country and that company really do deserve one another.

MikeNYC, Re. Morales. Yes, they have been arguing about his NG, he can really stuff it very well stuffed now (or soon). Reserves can grow to 30/40B barrels.

Thanks BOB

For info on CAE INC..... it closed at 12.50 it's a keeper

Bill, hard for me to believe the action today also. Utilities were positive all day, so I view that as substantive. However, the rest of the market, I believe, was totally manipulated for the benefit of very large players who needed to reset positions.

This probably sounds terribly jaded (and I even made money today...)

Something to think about. Jeff Rubin, CIBC World Markets' chief economist and market strategist just commented on BNN that he believes that the financial crisis in the U.S. banks will result in a major reduction in I.T. spending by those banks going forward. I guess non-critical I.T. investment and upgrades would be the first thing to be cut in most businesses.

Double top in gold?

Don't forget, greedy equity market shorts and gold longs tend to get squeezed...

Fred: Cisco's CEO was on CNBC today. He rattled off all of their strong markets, then slipped in "Weaker than normal Enterprise sales". Nobody questioned him further.

Very telling.

Thanks everyone for the education!

This was from ResourceInvestor.com a few days ago:

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

http://www.resourceinvestor.com/pebble.asp?relid=37509

Other central banks getting into the mix of selling gold ... and buying
By Jon Nones
07 Nov 2007 at 11:42 AM

European signatories within the Central Bank Gold Agreement of 27 September 2004 continue to sell off gold reserves per the agreement, as reported by Resource Investor. However, other countries are selling as well.

The Philippines is leading the charge by selling over 600,000 ounces in September alone this year. But interestingly enough, the Russians added nearly 350,000 ounces over the same month.

MikeNYC,stktrader
An art market collapse would be a great "tell', wouldn't it?
When the absurdly rich stop spending, who's left?
Recent action in Southby's would confirm your theory.

London Gold Market Report
Wed, Nov 7 2007, 12:21 GMT
by Adrian Ash

BullionVault.com

Gold Surges on China's Dollar Comments as Stock Markets Slide; Private Investors Offered New Access to Gold Investment in Asia

[...]

Last week saw two central banks in Europe sell 10.6 tonnes of gold between them under the terms of the Central Bank Gold Agreement. That marked a sharp increase from the year to Sept., when members of the Central Bank Gold Agreement sold a total of only 6.7 tonnes on average.

The Swiss National Bank (SNB), however, is bucking the trend, cutting its rate of gold sales by more than one-half in October according to the Federal Statistics Agency today.

"Twelve tonnes is much less than they sold in Sept., August and July," notes Matt Turner at Virtual Metals in London, "which was around 30 tonnes per month.

"I'd say this is bullish for Gold Prices."

[...]

Bill,
It sounds like they don't know how much they've got. The estimates are all over the place. I bet they start drilling in a hurry to figure it out. Oil services in South America, anybody?

The fact that it seems to be light is very good for them, too. It's not the heavy stuff Chavez has got.

I bet we see ol' Chavez on a plane to Sao Paulo as fast as he can get there. There's probably a planeful of Chinese or two heading there right now.

This could be a game changer. Not to get political, but it's just another reason the US administration's shameful neglect and bullying of South America, ESPECIALLY Brazil, over the past 7 years, will hurt us. Now they have more oil. Lots more of it.

I'm happy for them. Brazil is a great country and all the Brazilians I met there and here in the US have been wondeful people. And the women.... Yowza!

Maybe they can put some of the guys who have been burning the rainforest to work in the oil fields.

I think the real story will come out when they figure out A) how much they've got and B) the avg. netback per barrel once they go into production. Then you can put a number on it in terms of revenue.

I would think this is positive news for Argentina, also, no? A nearby, fairly friendly source of oil can only be good news for them.

MikeNYC,
For every seller there is a buyer. You mention that the Russians are buying gold. Any idea who else is a gold bull?

While I occasionally think there must be a PPT, I'm more inclined to agree with Jumble, that it must be machines trading on technical signals (which I'm guessing means algo traders, hedge funds, pension funds, prop desks, etc).

My reasoning is that looking at a 5-day comparison chart between the TSX and DJI, they look almost identical. I'd compare further out, but yahoo barfs on anything more than 5 days. But what other explanation would there be for two indices in different countries with different economies, sector balance and currencies to behave so similarly?

Is there any other explanation? Surely the PPT wouldn't be busy proping up the Canadian indeces as well, would they?

----

As for the quality of the people on this board, i couldn't agree more. It's always a pleasure to plow through the discourse!

Perhaps one day there will be little Cara Investment clubs across the globe where Cara community members would get together to discuss investments and social equity over drinks.

But i recall on the survey we had here a while back, the map showing where people voted from only had one lone dot on Edmonton, so I guess I drink alone :(

Fred,
Central Bank buying and selling is pretty secretive, even though they put out these numbers. I think I read the Kazhaks claimed they would be buying major amounts of gold a year or two ago and then they showed up in the numbers. I also, for some reason, suspect the Russians are buying more than they let on. For some reason Vietnam comes to mind, but I don't havea citation at hand. If you Google Central Bank Gold Buying (or better yet, set up a Google News Alert for it) you can get a feel for it.

The largest buyers are Indians, for jewlery. But that's a little misleading, because the jewlery there is not just ornamental, they regard it as a store of wealth.

Basketguy:

The clarification helps as I read your statement as a generalization that everyone who is having difficulty paying their mortgage is also up to their eyeballs in debt due to overspending.

Your account of your father's situation is a reminder of a similar case with my late father who went through some tough times in the late fifties and early sixties...eerily similar conditions with the high dollar and a seemingly booming economy.

He was just starting his own construction company, bought a parcel of land for a housing development and had been approved for financing through a gov't agency. Then a funny thing happened to our dollar as it was pegged downward....the financing was cancelled and the economy went down rapidly. He never read a blueprint to build a new home for anyone for about two years but kept paying his loyal workers. Needless to say the well ran dry and he had great difficulty paying the mortgage on our house let alone trying to put food on the table and it was not because of credit card debt(it was cash in those days) or car payment debt etc.

I think you can understand why your statement was of concern to me...not everyone today that is having or going to have problems paying their mortgages is in this situation because they are over extended as a result of other debt.

I know what it is like to see a proud hard working man almost crushed because eventually he had get public assistance to take care of his family.

I hope you father and the family are able to work their way through these rough times.

Bill,
I heard about the Africa field, but I do not know a lot about it. I don't know if it's the same one, but I heard there was a quite large field there.

Put it this way: Africa seems pretty unstable. And every time you hear about a stable country that is productive, a while later it goes up in smoke. I remember reading about how stable and happy Ivory Coast was. That didn't last long.

I bet Brazil has their oil in our cars before Africa gets their new field going. It's a shame.

By the way, this oil field in Brazil is quite deep. 5 kilometers below the ocean floor? That will add to the cost of production. It's also off the coast of Rio, which will be a quite nice R&R spot for oil workers with pockets full of reals. ;-)

Colombia is turning up lots of new little oil wells of the light sweet stuff. I wonder how long it is before they get a big new field, too?

Remember how Bush campaigned on making friends in SA? See how he turned his back on them as soon as he got into power? Recall how he picked a hated and antagonistic undersecretary for Latin America? Almost no one in the US knows who the undersecretary to Latin America is, but all of Latin America knows. And of course Bush picked a hated one and did not care about the ramifications.

Recall how a hugely succesful (incredibly succesful, actually) and popluar Brazilian anti-AIDS social program came under fire from the US religious right? A religious right that was allowed to set the tone of US policies towards Brazil? And how we tried to get Brazil to restrict condom distribution by holding back money!? (How ashamed I felt the day I read that news story.) Maybe a lot of Amercians don't know about that stuff, but a LOT of South Americans do. Brazilians do, for sure.

And now they have a nice new major oil field. Good for them.

How long before remittances from migrant Americans working in South America become a major source of our revenue? The wheel turns....

NYMEX to raise gold and silver futures margins
http://tinyurl.com/2hjrdb

It took effect today at the close.

Bill
Have a look at the Nov 2,5,6 and 8 DOW INDU from 2:30 onward side by side. They look eerily similar to me.

http://tinyurl.com/26toyr

GUYANA

http://tinyurl.com/324akz

Miller must be on some other planet.LOL Maybe in 5 or 10 years this will be a great call.

Legg Mason's Miller: Buy financials, housing stocks
Fund manager says today's battered sectors are market's next leaders

Amazing Exerpt: Miller's commentary offers a revealing look at how a celebrated contrarian stock investor views a market that hasn't been kind to his stock selection and value-based investing bias for the past couple of years.

Hmmmmm!

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B61FE8C37%2DFE5A%2D45D2%2DA766%2D0FD48AA2BF8D%7D&siteid=nwhfunds

Gold and silver margins raised! You called it Bill, and only a few days ago. This could tip the scales and cause a selloff so that we can reload.

Thanks. There is a big new find in Africa, as well. Got them mixed up.

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

Novice, thanks. That's important.

That's an attempt to lower gold and silver prices.

If the knockdown operations are beginning, lookout. Tighten your stops.

You can go straight to the source, Petrobras, in English: http://tinyurl.com/2s2bkq

"... biggest oil province discovery in Brazil, comparable to the most important oil provinces in the world, area ranging from Espírito Santo, Campos, and Santos Basins [right across Rio and Sao Paulo industrial regions] in deeper horizons, and in the so-called pre-salt rocks. The volume discovered in the Tupi accumulation alone represents but a small part of the new frontier.

Petrobras is the only company that has drilled, tested, and evaluated pre-salt rocks. The first well took more than a year and cost $240 million to be drilled. Nowadays, Petrobras drills an equivalent well in 60 days for $60 million.

Discovery is 28º API light oil to be estimated at 5 to 8 billion barrels of oil and natural gas. Petrobras is the area’s operator and holds 65% of the working interest, while British outfit BG holds 25%, and Portuguese company Petrogal - Galp Energia, 10% "

Also http://tinyurl.com/2nlf7l:

The Tupi field lies under 2,140 metres of water, more than 3,000 metres of sand and rocks, and then another 2,000-metre thick layer of salt. Getting that oil out of the Earth's crust is a formidable challenge, but Petrobras has become a global leader in ultra-deep offshore oil extraction. "If the best-case scenario happens, this discovery would make Petrobras' reserves overcome those of Shell and Chevron, and put Petrobras behind only Exxon and British Petroleum,"

http://tinyurl.com/2s7r5k

Crude Promises
Tuesday, November 6th 2007

With crude oil prices likely to rise above US$100 per barrel by the end of this year, there has never been a better time for petroleum-rich countries to buy their way out of chronic debt and underdevelopment. On paper, some have made startling progress in this direction. In the eight years since Vladimir Putin assumed control, Russia's gross domestic product (GDP) has increased sixfold, its average salary is now US$540 a month - up from $65 - and nearly two thirds of its overwhelming foreign debt (70% of GDP under Yeltsin) has been settled. In Venezuela, President Chavez has arguably used his country's oil revenues even more wisely. For the first time in living memory, many of Venezuela's working class have become an active part of the country's political process, largely due to the government's widespread subsidies of food, health care and education. This has earned Chavez the unassailable trust of Latin America's poor, even though his critics have referred to the erosion of normal democratic rights and the increasing attempt to take control of all aspects of the society. Elsewhere, however, the track record of newly rich oil economies has tended to be one of general failure, punctuated by occasional success.

Consider Sudan. Human rights activists all over the world have forced the media to pay attention to the ongoing genocide in Darfur. Yet the faltering of the peace agreement which halted the country's horrific civil war has gone largely unnoticed. Before the Comprehensive Peace Agreement (CPA) was signed in 2005, Sudan endured two decades of brutal civil conflict in which an 'Arab' north tried to subdue the country's 'Black' south. That war claimed two million lives; its sequel, if allowed to happen, would almost certainly eclipse the carnage in Darfur. The CPA stipulated that the country's oil revenues, mostly generated by the south, would be shared equitably, but far from being a source of development and income redistribution these have become a catalyst for both sides to reconsider their future. So, although Sudan's proven oil reserves are the fifth largest in Africa and even though the country's GDP has tripled in the last seven years, most of the benefits of the new wealth have gone to Khartoum while much of southern Sudan continues to languish in hunger, disease and grinding poverty.

A few months ago, the human rights activist David Morse accompanied three refugees from Sudan's civil war on a return visit to their villages in the south (his moving account of this journey can be read online at the weblog tomdispatch.com). All of them were from the country's Dinka population, part of the exodus of 'lost boys' - several thousand children who fled to Ethiopia after government forces had destroyed their villages. Their escape took several months during which they were often bombed and strafed by government aircraft. Morse writes, "[s]ome died in rivers; others were eaten by crocodiles and lions. Dying of thirst, they drank any water they could find; some drank urine. Starving, they chewed on inedible plants or ate dirt." Having survived this, the boys managed to make their way to America, and by any reasonable estimate they had done very well there: two had obtained higher education, the third was a professional nurse.

Their return visit was a painful reminder of how little has really changed in southern Sudan. Soldiers, teachers and doctors had often received no salary for months, roads were impassable in bad weather, children got sick and died, often in agony, for want of drugs that should be easily available. Meanwhile, Khartoum maintains a strong military presence near the oil-wells in the south and many openly refer to a plebiscite on secession scheduled for 2011 as the date on which civil war will begin again.

From an accountant's perspective, however, the south should be booming. Last year, Khartoum paid the government of Southern Sudan just over a billion dollars as its annual share of oil revenues - based on a production level of 300, 000 barrels a day. (Since then production has slumped to 254, 000 barrels per day and there are fears that Sudan's oil, already high in sulfur and therefore less valuable than was initially forecast, may be 'maturing'.) But despite the spectacular growth of places like the city of Juba whose population has increased from 100, 000 to a million during the last two years, the government in the south does not have enough money to pay its civil service, or to tackle many of the critical human development needs that it faces. In this context, control of the country's oil is soon likely to degenerate into a lethal confrontation. And, since 40% of the national budget is currently spent on defense, the next war will undoubtedly be much bloodier than the first.

When Morse interviewed Southern Sudan's minister for oil, Dr Benjamin put the problem succinctly: "We are not getting all our oil." The line demarcating claims from the North and South has still not been definitively agreed on and unless that dispute is properly settled, war seems almost inevitable. The minister pointed out that the CPA which brokered the current, fragile peace is an international agreement. It was signed not just by the North and South but also the UN, European Union, the Arab League, African Union and the United States. In a cri de coeur that should be branded on to the hands of everyone who signs these agreements, Benjamin says: "I should not have to shout this from the rooftops! You don't give birth [to a peace treaty] and then forget . . . You need to nurse it, see that it grows properly." It is highly probable that something similar is being muttered by Iraq's bureaucrats.

"Oil don't spoil" said the Trinidadians in their first boom years. But they were wrong. It often spoils, and in spectacular ways. Societies that cannot or will not address their known failings so that they use the money for serious development, soon relapse into all the old familiar quarrels.

That has been been the case all the way from the creation of Saudi Arabia to the impending dissolution of Iraq and Sudan. If Guyana becomes a significant oil producer in the next few years, are we likely to prove an exception?


CGX Energy Lines Up Financing for Guyana Exploration Program
CGX Energy Inc. Thursday, November 08, 2007

http://tinyurl.com/yvdw2a

Bill... could yu elaborate more on this comment from your last post.... thanks...

"What I see going on today is bizarre. The downside will not be so bizarre. If you don't see it coming, you must be blind, deaf and dumb."

This following announcement is bound to impact Novagold's (NG) share price tomorrow. I'm sorry but, I really don't know who came out the better for the deal.

TORONTO, ONTARIO--(Marketwire - Nov. 8, 2007) - Barrick Gold Corporation (TSX:ABX)(NYSE:ABX) and NovaGold Resources Inc. (TSX:NG)(AMEX:NG) today announced that they have reached a mutually beneficial agreement to advance the development of the Donlin Creek project and resolve all outstanding legal disputes between the two companies. The various transactions contemplated in the settlement agreement, including the dismissal of all outstanding lawsuits, will be completed on or about December 3, 2007.

Highlights

- Barrick and NovaGold form 50/50 limited liability company to develop world-class Donlin Creek gold project
- Galore Creek Mining Corporation to acquire 100% interest in Grace claims
- Barrick and NovaGold to drop all pending litigation

http://tinyurl.com/33oecy

New oil in Brazil

from Globe and Mail today….

"Petrobras, The Tupi field lies under 2,140 metres of water, more than 3,000 metres of sand and rocks, and then another 2,000-metre thick layer of salt. Getting that oil out of the Earth's crust is a formidable challenge, but Petrobras has become a global leader in ultra-deep offshore oil extraction….giant new field containing up to eight billion barrels of light crude off the coast of Rio de Janeiro…"

From Reuters "….Company officials said commercial production could begin in five to six years. A pilot project should start in 2010 or 2011 with an aim to gradually reach an output of 100,000 barrels per day.."

This is a great find as far as new discoveries go these days, but lets keep it in perspective.

- 8 billion barrels recoverable, the Canadian tar sands are estimated at around 150 billion recoverable.

- production estimate at 100K barrels per day, world use is in the range of 85 million per day

This is great for Brazil and it will help reduce their need to import lite sweet to mix the their normal heavy crude for refining. It's probably good that it is so deep, this will economically stop them from installing too many straws and depleting the reserve life to quickly. Look at the problems with rapidly declining reserve life at Cantarell in Mexico.

From what I read tonight I don’t think this field alone will have much impact for the USA and oil prices in general. Now if they were to make 10 more this size, that would be significant and have a world impact. But at over 4 miles down this won't be cheap oil.

long or short? food for thought:

go back and read posts from the spring and summer of 2007. tone was bearish, quick to enter the ultra-shorts, disbelief in the face of every leg higher. and from a contrarian perspective, i think most of us agreed that more fence-sitters needed to be pulled into going long before the bear would start (and maybe in my wildest dreams i imagined i would be one of them->thanks to technology my "conversion" has a time stamp of 527pm 11/6). hardest thing to do (which is almost invariably the right move to make) last summer (for me) was to go long with conviction.

now it's late fall, global markets are finally taking a hit, and i find myself doubting the bear. now the hardest thing to do (for me) is going short with conviction. how the hell did that happen?

couldn't wait to buy QID when the "Q" was bouncing in the mid-forties, and now i'm afraid to buy QID as it starts to plunge on high volume in the fifties? there's something to be learned from that "picture."

does anyone disagree the "right" posture has moprhed from buying the dips to shorting the bull traps? and why am i having such a hard time with that?

will find out shortly how confident a contrarian i am ;)

Quasi, They seem pretty certain that the 8 billion is the beginning. But I expect there will be a lot more drilling to figure it out.

Bill

I do understand what you have been telling us about those talking TV heads. It was your use of the term "bizare" that sparked me to ask you to elaborate.

Thanks for responding back.

MikeNYC, I guess its just you and me and Bills bottle of Cab

Yes I agree, they are hopeful this is only the beginning for the discoveries in this offshore basin. It will be expensive but at $100 and up per barrel it becomes an opportunity, I am convinced we have passed the peak in "cheap" oil.

The reserve depletion rates world wide are accelerating, new proven reserves are not keeping up with increased demand, IMHO prices will continue the underlying trend, UP.

I remember lining up to find gas in the mid 70's, shortly after that they started making Cadillac's with 4 cylinder engines, boring, but you could find enough gas to keep em going. When things were plentiful again every one wanted a tire squealing V8 big block. Well we've gone way beyond that now, I just have to look at all the Hummers in the grocery store parking lot. I think we will see shortages again within a year or two and then people will start to change how we use energy.

Lesia,

If you see this I left a post for you on your web page.

Goodnight folks... I'm beat!

The "bears" and the "bulls" worked this "pig" over today. :-)

Quasi, you raise some good points, however those 8B are just the tip of the iceberg. They estimate at least 20B). They got 100% success rate on three consecutive wells, which is rare. Also, not sure what is the value of 150B of tar sands oil vs 8b ( light crude. The cost of each well is 60M, don't know what the cost of each well is in Alberta, but it's not cheap. Labour is definitely an order of magnitude cheaper in Brazil. Brazil already exports oil, imports a bit of light crude; more importantly this will cut their dependency on Evo as well as make them into an exporter of light crude. Agree, won't make a difference now, the point is buy PBR because lots of other results will be forthcoming.

http://www.estadao.com.br/economia/not_eco77736,0.htm
portuguese)

(Bolla Valpolicella here).

SiO2

Interesting handle, is that silicon dioxide or does it mean something else.

Wish I could read your link, is there an English translation?

Yes I agree they think the pool is much larger, I was quoting 8 B as what they might be able to recover, usually in the 10% range. Same thing for the 150 B tar sands its the recoverable estimate.

For the most part there's not much drilling in the tar sands, its surface mining. You just dig it up add a little solvent and melt it for processing (simplified version). Now in some areas where the overburden is a little thicker they are trying SAGD (steam assisted gravity drainage). Basically drill a bunch of shallow horizontal well bores, inject steam in the upper layer and let the melted oil drain into the lower pipes and pump it out.

Just finished a couple of St Peters English Ale's, but like Bill I also like the Cab's just don't wanna crack one now as they always seem to require emptying before I go to bed.

Quasi,

Many sites, including Google, will translate a Web page. Go to Google and select Language tools. Enter the link from above and specify "Portugese to English." I have done so, here, and then used tinyurl to shorten the link:

http://tinyurl.com/2hssfv

Apologies if this is a bit afield from short-term trading. But... When there is a discovery of an absolutely massive find of oil, under two miles of solid salt, which is under three miles of rock, which is under miles of water, does this not gnaw away at the theory that oil is an end-product of the degradation of a conveniently densely located mass of prehistoric plants and/or animals? Is the fossil origin of oil another one of those fairy tales we are taught? Did tens of millions of dinosaurs go to one place and become collateral damage during a Sodom and Gomorrah salt-fest? The scientist in me wants to know... If this proves to be an interesting question to ask, perhaps the answers may one day also assist fundamental long-term investing analysis by confirming or disproving theories regarding the limits on the supply of oil. Does anyone believe that geology like this seems incompatible with fossil fuel theory, or is it just me? 'night all!

Shanghai up 0.45% tonight:

http://www.sse.com.cn/sseportal/en_us/ps/home.shtml

Must read post called "WaMu and The Rep War"

"Fannie Mae is saying that WaMu will take back any loans with dubious appraisals this "independent examiner" digs up. WaMu is saying that it will "rigorously" avoid doing so."

http://tinyurl.com/35jgew

northvan

thanks, I'd forgotten about that Google translator, works quite well.

The margin increase is pretty stiff. But I wonder if it will have the effect they want, or that it used to have when COMEX was the only game around.

As far as I can tell, margins on the CBOT are the same. Dubai trades a huge number of contracts, and barely existed last time margins got raises. They haven't raised theirs. TOCOM trades a record number of gold contracts, and so on.

I think it may be more important as a sign that other facets of the'operation' on gold may kick in, too.

Of course, I may be wrong.

RE aa

Yes deep oil below historic organic levels. Interesting subject, I think the Russians were the first to start several theories on Abiotic oil created deep in the earths mantle, not from organic material.

aa,

Regarding the abiotic theory propounded by (some would say "demonstrated by") the Russians since the 1950's, here's an article from "Asia Times": http://tinyurl.com/3dsgen

Brazil's oil find, per the article Si02 flagged, involves one single field with potentially 20B barrels, and the find overall could catapult Brazil's total reserves to a level between Nigeria (70B barrels) and Venezuela (100B barrels). Also, the article says that USGS and a US oil consulting firm, HRT, were involved in the studies that underly these numbers.

It's also important to remember that PBR is considered one of the best national oil companies, and that they have developed considerable offshore expertise. I doubt that this announcement would have been made if they weren't pretty sure of a major breakthrough.

In general, Brazil has centers of high tech that are world class, such as ERJ, the world's 4th largest aircraft manufacturer, which sells regional jets to US carriers.

BTW, the NY Times article on the subject is MUCH more modest in tone than the Estado de Sao Paulo's .

AA: Not at all. The amount of biomass sinking to the bottom of the sea over millions of years would be substantial. There is far more biomass in the seas than on land, and the planet is predominantly sea. So it's not dinosaurs, it's everything from minute worms and amphipods to whales. Tons and tons of them (and their waste)over a very long time. Thats a lot of detritus under extreme pressure.

Putting the size of PBR's find into context. Ghawar, the largest oilfield on the planet, produces about 5 million barrels per day from an estimated reserve of 70 billion barrels and the largest 5 oilfields in Saudi are all 11 billion bbls+ in reserves, so the smallest is 2x this PBR find.

Putting it another way, Ghawar has been producing since the 1970's but if this PBR field could produce at Ghawar rates it would be dry in less than 3 years (assuming 5 bn bbls/5 million bpd = 1000 days)

Capital -

Every bit helps, right?

NYTimes thinks PBR's big new field has 5B barrels, You think 8B, Estado de Sao Paulo thinks maybe up to 20B.

Nobody knows. Maybe 70-100BB total in Brazil. Every bit helps!

I'm just amazed that the DX is .18 from a 74 handle and gold is just grinding along weakly. That, more than, or along with, the margin increase, has me alert for a managed stifling of gold.

Alert for a meaningful short opportunity. The London open will speak volumes. Those guys are worse than COMEX in the manipulation department.

A hammer down in gold on Friday would give the mainstream media a long couple of days to pronounce the gold bull dead.

Please pardon my tinfoil hat.

Fred,
Regarding the Barrick-Nova Gold agreement, I do not think there is any loser on this deal, except the lawyers.
Now that the uncertainty of legal disputes is removed, they can work together at the development of Donlin Creek instead of wasting time and money in courts.

Bill,
How was the 05 Mondavi Reserve Cab ?
Maybe a bit too young ?
The 87 & 91 are drinking beautifully now.
Please let me know if you plan to visit Montreal in the near future, I would be delighted to open a few bottles for you.

Thanks for the great comments about the restaurant. Talk about a free ad... I am Bruno Piras, GM of Modavie for close to 10 years now. It would be an honour to have some of your community come and enjoy our passion for food, wine and great live jazz!!!

ALOHA !!

Bill ... Regarding GEDEX. I found a number of studies on different methodology of exploration techniques published at the Ontario Ministry Of Northern Development Of Mines(MNDM). I provide a link below to the report on their website. The report reviews about ten different methods of mining exploration and GEDEX was evaluated, but unfortunately it costs $20 for the full report on a CD-ROM. They test these systems at the Abitibi and the Lake Nipigon regions of Ontario. The report is dated 2005. In the briefing they seem to give the GEDEX system high marks for its capabilities compared to other airbourne systems for exploration using AGG digital data.

Here is the info:
GEDEX
Miscellaneous Release—Data 166 Gedex Airborne Gravity Gradiometer (AGG) System; by Gedex Inc. This project focussed on research, development and testing of a prototype high-resolution airborne gravity gradiometer (AGG) system capable of detecting mineral deposits that are invisible to other airborne gravity survey systems. Extensive modelling and analysis was conducted that validated and improved the design of Gedex’s prototype gravity gradiometer instrument. Laboratory and in-flight testing of vibration isolation mounts were also conducted and precise data on acceleration and vibrations of a variety of survey aircraft were collected. Report files (in portable document format (.pdf)) are on 1 CD-ROM. $20.00.END

Link to full report: http://tinyurl.com/yr7rtu

By the way ... has anybody else noticed that at "Tiny URL" they have a "WE SUPPORT RON PAUL" banner on thei home page?

ALOHA !!

Good night ... I have a concrete pour tomorrow and the price for delivering concrete has gone up about $30/yd since my last pour back in July of this year!!! WOW ... the stuff is like gold!!! It keeps going up !!!

What inflation?

Bernanke got grilled by Ron Paul and as usual he had no real answers just like when Ron Paul used tp grill Greenspan. What can they say ... THEY ARE THE PROBLEM!!

ALOHA !!

Hummmmm ... I just discovered I can put in my URL on these posts! I guess I've been a zombie the past few years. I never noticed it before. Is that new Bill?

Thanks Bill for you "cutting edge" commentary on a wide variety of topics.

And YES gold does have many years to go ...

ALOHA !!

Just as an aside regarding oil exploration BAKER HUGHES(BHI:NYSE) makes some awesome equipment for oil exploration and drilling abandoned wells. Boy, their stock was on a tear up until mid October and has now pulled back significantly to the $86 range.

I recall my Father used to work closely with Baker Hugher techs out in the field ... Back when it was just Hughes! They have been around a long time.

Kaimu,

"What can they say ... THEY ARE THE PROBLEM!!"

Yes. Being a tumor vs. having a tumor are very different perspectives for those involved!

Futures are down... and

Get Ready For More Downgrades

From the WSJ:

In the next few weeks, debt-rating services like Moody's Investors Service, Standard & Poor's and Fitch Ratings look poised to downgrade hundreds of mortgage-related investments worth tens of billions of dollars, creating the potential for more market unrest.

....

Credit-rating firms have lowered their credit ratings on more than $70 billion in mortgage-related bonds in the past few months, setting off waves of distress in the stock and bond markets. They've also expressed concerns about the outlook for a range of related industries from banking to bond insurance. Banks and Wall Street firms including Citigroup Inc. and Merrill Lynch & Co. took large charges when they were forced to reassess the value of even their highest-rated mortgage debt.

The article also has this very revealing graphic about the breadth of the writedowns:

Calculated Risk is such a great blog. I highly recommend it. A must read article there...

http://tinyurl.com/2nnhdb