Good morning Bill, I couldn't agree more with you about our so called political and business "leaders" (what a joke). I especially agree with your comments on the Iraq War. Just this morning I was thinking about the lies and deceit that was used to get us into the war and the continuing obfuscation and deception used to pay for it. From what I understand this whole war has been funded "off Balance Sheet". I'm still not sure what that means; are we selling Treasury debt to pay the costs or are we just "creating" the money? It appears we just continue to plumb new lows in honesty and integrity.

Introducing: The History Of The French Franc

http://en.wikipedia.org/wiki/French_franc

(Any historical comparison of the $US with the £ may be discarded at this point.)

Good Morning.

Here are your Cara 100 Ratings Changes:

Upgrade:

TM - to Neutral @ HSBC

Downgrade:

DIS - to Sell @ Citigroup

Target Price Lowered:

BDK - $71 to $62 @ Sterne Agee

------------------------------------------------

"Luck is the meeting of preparation and opportunity"

2nd_ave...

Hope you caught that SNDK train...Looks like they took out the stops on the way down and now we will see the fireworks...

Anyone have clue what is going on with the banks and home builders? The rise in these stocks lately has been absolutely inexplicable.

Did anyone actually read yesterday's new home sales report?

Incredible dislocation with fundamentals here. If the story ever comes out about what actually is going on, I'll bet it's juicy.

It appears the South Africans don't have enough power plants and that is affecting the mining industry.

http://tinyurl.com/2y56m7

Dozens of other stories are on the net.

Eskom is a huge utility and for the nation to have let themselves get in this position is incredibly bad management.

It takes 3 to build a coal fired power plant excluding regulatory red tape (like we have here in the US).

I hadn't seen it mentioned on Mr. Cara's site yet.

Make that 3 YEARS.

Whoops.

Bill,

I have read that OTC Derivatives have accounted for up to 50% of Investment Banking earnings.

I know you have a background in this area, so; if a key risk today is the meltdown of said derivatives, how is that going to affect earnings estimates moving forward. A quick glance across a number of names looks like there is more downside risk to earnings estimates than upside surprises.

This came to mind with your comment on the gnomes above, btw.

I-loser..

Take a look at any bear market and look at the rally attepts...

20% rallies in the indexes even in a bear market are not uncommon..

Shakes the nerves of the Bears and even some unexpecting bulls jump back in thinking the worst is over.

When you think they have exhausted the rally, they will push it another 3-5% and we are left wondering who is doing all the buying...

I_Loser?

I don't know what is happening with banks or homebuilders but I plan to back the truck up on SRS and SKF Thursday or Friday after tomorrows rate cut. I sold them the Friday before the emergency rate cut and have been staying cash with this planned re-entry later this week.

So far the rally in their stocks and pushing down SKF and SRS has been better than I could have imagined.

My attempt to 'plan the trade and trade by the plan'.

Bill and others, good morning! I like your discourse the last two days. There can be no personal freedom without financial freedom - free societies are built on free markets. The manipulators have engorged themselves on the public weal and refuse to let go. I had a discussion with a Citibanker who said that if Citi went under, 250 thousand jobs will be lost. He expected me to be shocked. I thought that would be a good thing. There are few investment bankers left in investment banks - why take risk when you can just sell the Greenspan - Bernanke put. The investment bankers are now doing VC work in California. This country wants all the manipulators and incompetents to be swept out, and fresh blood, and real investment bankers to start allocating money. Citi and the minions at the Fed do not see that. Their short term fixes are long term ruin.

Bill and others, good morning! I like your discourse the last two days. There can be no personal freedom without financial freedom - free societies are built on free markets. The manipulators have engorged themselves on the public weal and refuse to let go. I had a discussion with a Citibanker who said that if Citi went under, 250 thousand jobs will be lost. He expected me to be shocked. I thought that would be a good thing. There are few investment bankers left in investment banks - why take risk when you can just sell the Greenspan - Bernanke put. The investment bankers are now doing VC work in California. This country wants all the manipulators and incompetents to be swept out, and fresh blood, and real investment bankers to start allocating money. Citi and the minions at the Fed do not see that. Their short term fixes are long term ruin.

bg- actually, i added a little SNDK in last night's extended hours session (still don't 'get' the bad news, there really isn't any)->taking that part of it off pre-market, but still holding a half position + of course hoping the puts i wrote will pay off...

DJIA 12,500 within sight...if that gets taken out, then of course bulls target 12,800...looking to short somewhere between...

Jock, you wrote:
"Mexican-style unbridled capitalism leads to the richest man in the world owning 1/3 of the value of the stock market -- while millions of countrymen have to risk their lives leaving the country to feed their families."

This strikes a nerve with me in many ways; please see this:

http://tinyurl.com/2mwhp9

Excellent arguments on 'social equity' and how it leads some to associate it with socialism.
What really ticks me off about the lack social equity:

for fourteen years, I've been driving up and down Biscayne Boulevard. It is a microcosm of the wealth gap between rich and poor. I see homeless men and women who ask for money while I sit in minivan comfort at a red light(and when it turns green to allow time for three cars to run their red light).
This ain't right. The local homeless shelter has given up on 'ending homelessness'; their new slogan is 'ending chronic homelessness'. So we as a community have come to this - accepting temporary homeless men and women, some of whom are sober and jobless, while the rest are mentally ill and hopeless.
Yeah, I'm in top tax bracket and I'm fortunate. I'll pay my fair share of income tax, permanent Bush tax cuts extended or not. But I'll be damned if I have to see Americans sleep on concrete for another fourteen.
To answer CaseyKochmer from yesterday re:
"How would you propose making a difference socially while working as an intelligent day trader?"

- ice in the veins for trading prices, love in the heart for seeking social equity.

Stu

Sounds like a good plan, JVS3. I suppose those stocks a rerising on the vapors of the gov't "stimulus" plan.

Regarding SNDK, remember our discussion about options volatility for MSFT? Well, yesterday SNDK option volatility was at 52-week highs.

Will it come down substantially today? For those of you who sold Feb 25 puts, I hope and expect the answer is yes.

At the risk of sounding like a dissident....yes 5 soldiers died, but according to Care, "Every minute of every day, somewhere in the world, 21 children die of malnutrition and preventable diseases." How I wish the outrage over the deaths of our soldiers would extend to the plight of the world's truly impoverished.

I'm not sure that I recognize "social equity" as being linked to "protecting our own". To this feeble brain, such a statement appears to be to be wealth-centric to the individual and doing little to promote social equity in the broader context in which I had understood it and indeed have embraced it.

"preventable diseases"

it would take a fraction of the amount allocated to maintaining our presence in iraq to fully treat the entire hiv+ population in africa...everyone waiting to die because they can't afford the cheapest antiretrovirals at the drugstore down the street would literally be up and about within 2-3 weeks...no miracle involved here...

Flying beneath the radar: Chinese renminbi has gained 1.4% in the first 3 weeks of the year!

Seems like it would take 4 months for that to happen last year. See more Chinese buying power overseas among other things. Wal Mart products becoming more expensive? Will have to ponder that later.

Cara 100 Additional Change:

New Coverage:

GOOG - Buy @ Canaccord Adams - Price Target $755

I posted a recession chart on my site below of how the market perform prior and after recessions. The only question is where are we on the line.
http://www.WallastonInvestments.com

bg- wondering if they're running the stops on VMW also...tempted to add, but respecting the fact that it's a spec play->small position opened at 60.85...currently 58 and change...

Clean pottable water would safe countless thousands of lives. Simple stuff.

2nd_ave...

P/E...Still sky high on VMW and not enough history to weigh future...

I know the products VMW have are LOVED by customers...Ask any IT person that sells their products. I do not think MSFT has a chance to compete, but the 800 lb gorilla is hovering overhead.

That is why I say look at EMC...Think you are getting better risk/reward...EMC is on my radar and I am waiting for the dust to clear...

I think the best way to beat the Gnomes and the people using the public treasury for their own gain is to vote people into office that understand and are willing to address these issues.

We need people who want to:

End the Iraq war and bring most of our troops from around the world home.

Cut spending and/or raise taxes to the point where the government runs a surplus and pay down the debt with that surplus.

Save the SS surplus in something other than treasuries. There is still 10 years of projected surplus that could shore up the system in the future but not if we have to issue more treasuries to access that surplus.

Pass term limits for Congress. Lifetime legislators are the main reason everything stays as the status quo and also makes it easier for legislators to enrich themselves on the public treasury.

Either abolish the Federal Reserve or figure out how to make it responsive to America and not to the "vested Interests". The problem is that it is run by executive bankers. Maybe the people should elect the Federal Reserve board members instead of having them appointed.

Citizens also need to be more concerned about Government than about what happend to OJ or Brittney yesterday. Citizen apathy is a major cause for our current situation.

And I know this will create a firestorm but it's my opinion. I think everyone should pay at least some taxes. We should keep citizens to a minimum that pay no taxes but receive tax money. Otherwise, those citizens have an incentive to vote for the over-spending status quo(or whichever politician promises them more goodies). People who pay for government have more of a stake in keeping government fiscally sound and honest. At last look I think it was over 50% of households who have no income tax liability. How can we expect them to vote for responsible government?

These reforms, if enacted, would go a long way towards achieving more Social Equity. Obviously, I don't have all the answers but I do think about policy quite a bit.

It's unfortunate that some of you think I'm a "right-wing hate monger". Nothing could be further from the truth. I am much more of a Constitutionalist/Libertarian. Having a 6 year old and a 1.5 year old, I really want us to turn America around so they and all the other future generations can have a brighter future.

Rob.

UYG- clearing the table at the open...

Scottrade:

Account Information and Trading is not available at this time. Please contact your local branch to place trades or to verify open orders and executions.

First time in two years I've seen that from them.

kp84, I grew up in the Chicago area in the 1970's. No one ever discussed homeless, let alone chronic homelessness, back then. Why is that?

Maybe I don't remember too well, but I don't recall homelessness emerging as a significant problem until the 80's.

It's only grown worse since then.

Back home in Chicago, I noted that during the recent cold spell they have made a homeless shelter out of an I-94 oasis (what used to be home to Howard Johnson restaurants).

FYI:

Modern Web-2.0-like tag cloud of President Bush's State of the Union:

No.1 iraq
No.2 congress
No.3 terrorists
etc

http://tinyurl.com/39mala

il- 70s-> i remember hitch-hiking from ann arbor to LA my freshman year of college..in january! back then no one was 'homeless,' we were all kids having a good time being on the road ;) some of them got carried away and ended up really down and out in the 80s...

I-Loser

Yes, your memory is correct. Back in the early 1980's,the law changed under Reagan which cleared a large number of individuals from the mental institutions. They took to the street and had to fend for themselves. Homelessness was seen everywhere. Overnight, Wash, D.C. had "grate" people sleeping on the grate vents of federal buildings. You saw the same thing with homeless all over the country. Ever been to Santa Monica at night along the beach?

BXP and SLG have both regained their 50 Day moving averages but SPG has not yet. I think Commercial Real Estate will be the next financial shoe to drop. I'm planning on buying Jan 09 puts on some of them after the FED decision.

Rob.

The current discourse about Social Equity...on a financial blog...is no less than inspiring; and I salute the quality of thinking typical of us Caraistas.

Perhaps a good starting point would be to define a short list of core values which should extend to all members of our society; then to build incrementally on it in an attempt to create a reasonable balance between guaranteed rights and opportunity.

It seems almost pedantic but such items as decent shelter, adequate food, basic education and quality healthcare might form the core building block. From there upward, negotiation and consensus could be useful; at what points do workers' rights conflict with employers' prerogatives? Who pays what share of the cost of operating a civilized society and how is that burden best apportioned? How much is set aside for later-life support and what mechanism (operated by whom) will accomplish that objective? Should assets accrued by one generation automatically pass to future generations or should some portion of it revert to the benefit of all of society?

Obviously, such an undertaking extends well beyond a blog but the intelligence expressed by Bill and others here is far more productive than the cruel gruel produced by our current crop (or is it "crap") of political midgets and self-indulgent capitalist "monsters".

It is appalling to me that these issues were resolved during the first half of the past century, starting with Teddy Roosevelt. How stupid mankind and how short his memory.

So far APPL, SNDK, MSFT, and VMW have all went down after earnings. IBM is the only tech stock I remember going up after earnings this time around.

What does this mean for GOOG? Should we expect that they will crash after earnings or maybe they'll do an IBM. I don't plan on playing it. I'm terrible at earnings plays.

Rob.

Can the $SPX break throught the resistance band of the March and August lows of 1364 - 1370?

This market feels like Bernie from Weekend at Bernies (movie where Bernie's dead body was propped up to appear that he was still alive).

Finger: I stand corrected. I don't think you are a right wing hate monger, but I'm concerned when I hear the "income redistribution" talking points manufactured by HB&B to divide us from one another.

I worry about my daughter and your kids and their kids.

I'm for all of your ideas except perhaps term limits as if the citizens want someone they should be able to vote for them regardless of terms. To fix the lifetime politicians issue I think requires completely public funding of elections so regular citizens can serve and we can let some of the wealthy go home and rest. LOL!

For instance, I understand Mitt Romney will use up to $40 million of his own money to run for a job paying a few hundred thousand dollars a year.

Hmmmm. How does that work?

I think we can all see we actually agree on the goal. Finding where we argee is key.
Firing those that divide us to get elected is first on my agenda.

don't know how much longer this market has to the upside, but have been closing out longs all morning (INTC/SNDK/TM/even FXI)...feels like we've dodged a few bullets the past week, closing up following steep drops in asia->risk/reward makes cash look good right now...

Hi Rob,

I wouldn't want to speculate against GOOG but have noticed that many high P/E stocks have been under tremendous selling pressure the last week or so.

Regards

SLW tanked -5% at the open on news that Goldcorp May Sell Silver Wheaton Stake, National Post Reports
http://www.bloomberg.com/apps/news?pid=20601082&sid=asZAw2iaczbs&refer=canada

I hope this is just a rumor, as I'm long SLW and hoping to stay that way.

SLW tanked -5% at the open on news that Goldcorp May Sell Silver Wheaton Stake, National Post Reports
http://www.bloomberg.com/apps/news?pid=20601082&sid=asZAw2iaczbs&refer=canada

I hope this is just a rumor, as I'm long SLW and hoping to stay that way.

Ronbon,
I agree totally with your statement. And I have optimism that we can do it again and turn America around. I'm willing to look at any option to turn America around.

Your core building block is a perfect starting point, which a few above have noted we don't have yet with the homelessness rampant in many cities. Ever go to Key West, tons of homeless down there. It is shameful for a country as great as America to allow our fellow citizens to live in such a way.

Instead of bailing out mortgage lenders and banks that money would be better spent taking care of our unfortunate citizens.

We need to inspire people to vote with their heart and not with their wallet. We need to vote for the good of America over personal gain. I, personally, am willing to pay more taxes if we run a budget surplus and start paying down the debt and addressing more of the social problems today.

Rob.

Craig, there has been on more than a few occasions you have felt the need to claim a side on the political battlefield an am not sure why? On more than one occassion you have come across as if you don't like or repect the right, christians or conservative thinkers. This could be wrong but you seem to want everyone to know where you stand.

Social equity cannot be had when those of diferenting opinion cannot respect the feelings, thoughts and ideals of others that are different.

Labels like right wing, left wing etc do nothing to furhter discussion and to heal a country. The media and internet have been very successful in dividing the country and making people choose sides, dig in and fight. We can no longer resolve issues like in previous generations cause were all to busy ramming our own ideals down everyone's throat and this goes for any and all sides.

I am so tired of the in-fighting going in the country.

Here's to looking forward to working on common causes and uniting the masses by first seeking to understand and respecting everyone has a different opinion. I will vote for the candidate who has these ideals regardless of economics or political affiliation. Enough is enough of the bickering of a divided country.

Craig,
Thanks! I'm glad we can stand together as Americans. I respect all of your opinions and am open to changing my mind on anything. That's what debate is for: refining our views while being open to all points.

The amount of money people spend to get elected is a huge problem and indicative of how corrupt the system has become. Why would someone spend 40 Million for a 400K a year job? Obviously they're either blindly power hungry or getting something far more than the salary for the job.

Publicly funding elections would be a good way to get business influence out of elections and allow regular people to compete for office. I just worry about how we would pay for it without running up more debt. If we could do it while running a surplus I would be all for it.

Otherwise, I would say we should have maximum limits that any politician(including any 529 or other group endorsing that politician) can spend in a run for office.

Rob.

For anyone who is looking into buying VMW you need to google 'Xen'. Xen is an open source(this means free like linux, debian and ubuntu). Xen has multiple companies who have extended it's functionality and are selling support. That support is cheaper than buying only the VMW product. I have used both in my business and I use Xen exclusively now. And this is a growing trend in the computer industry.

To give a previous example this is the the exact same thing that happened to Microsoft's IIS(webserver). Apache is an open source application that actually works better than IIS, and so Apache now has the majority of the webserver market.

Thanks Stu:

I like the answer

- ice in the veins for trading prices, love in the heart for seeking social equity.

While trading is trading. Part of the key is to also be not let go of the heart.

Bull Hunter,
I know. It's almost as if expectations are so high or prices are so high compared to earnings that no matter what they report the stock goes down. I doubt if I'll take a position though since I'm terrible at betting on earnings. For example, I was looking at buying VMW calls before earnings. That would have been my typical earnings gamble. So, now it is one of my top ten rules for trading. No earnings gambling!!

Rob.

Bill,

Boat in the water . . .like we're going around in circles because all are rowing on the same one side. What's it going to take to get both oars in the water?

Before you solve a problem, you've got to recognize the problem. Hmm, maybe we're ready for the next step.

Cara 100 Final Update:

Target Price Lowered:

SNDK - $63 to $40 @ Lazard Capital
YHOO - $36 to $30 @ RBC

Over the past 5-7 trading days it seems that the Dow has a ceiling at about 12400'ish. Are there any technical analysts looking into the major dow components for market internals and potential market direction?

Winter hitting China hard.

http://tinyurl.com/2g7yst

Two of the takeaways--agriculture land "destroyed" and coal in demand . . . rolling blackouts to conserve.

More manipulation afoot

http://tinyurl.com/2wbfkr

"NY Insurance Dept suggests that ratings agencies postpone a downgrade of bond insurers until the state can develop a bail-out package."

And then the funny line

"Moody's said we don't forbear on our ratings based on talks with government officials."

Well they sure forbear their ratings changes based on something other than reality so they must be owned by Wall Street and not Government. Unless they're just trying to hold a poker face while they do what NY wants.

Rob.

Bill,
I've been a daily reader of your site for the past 6 months, but only just now signed up as a result of your statements today.
I look forward to contributing to the discussions that take place here.
Nathan

Rob,

I try to buy into panic selling when an otherwise good company misses by a small amount, then sell it before the next earnings report. I've done this with YHOO in the past and it seems to work out well.

Regards

Server Error

JVS3 -

I am with you on SDS/SKF, although I am leaning towards SRS. SKF and SRS have sold off back to their 100 day moving averages which have been excellent buying opportunities in the past. Financials and real estate led the market higher and I expect them to lead the market lower, at least to test the bottom.

Bill,

To add to your discussion on price targets based on P/E's and future potential price targets -

I have posted examples of stock purchases on RSI weakness / buy alerts using future price targets based on P/E's. These have all been profitable trades, but that was in an uptrending market. Please critique the following scenario for community educational purposes.

Scenario with stock in AZ:

- XYZ trading at $22 with a dividend yield of 1%.
- Current earnings are $1.00 for a P/E of 22.
- Next years earnings estimates range from $1.10 to $1.30 with a median of $1.20.
- Historical 7 year P/E range from a low of 20 to a high of 30. Average is 25.

So: Based on next years estimates and historical P/E cycle, I could expect a future stock price range of $22 (low P/E of 20 * low estimate of $1.10) and a high of $39 (high P/E of 30 * high estimate of $1.30) and a reasonable price of $30 ($1.20 * 25).

I would then decide to write puts with a strike price at $20 which is 10% lower than my lowest estimated future price so I wouldn't mind owning the stock at $20.

If I simply bought the stock today at $22, I would expect a capital gains profit of 0% to 95% with a "reasonable" return target of 36% ($22 to $30) plus dividend - commission, if I gauged the cycle correctly.

Questions -

Do you use next years estimates in this way?

If so, do you take next years estimates at face value, or do you use an even lower estimate to gauge possible risk during difficult economic times?

Is a 7 year P/E cycle long enough for you?

Without any mathematical errors on my part and realizing that other factors are involved (technical analysis, sector rotation, etc.) in the trade, does this method suffice?

I know Bill is extremely busy, so maybe the community would like to help flesh this out?

IMO, this is the type of analysis that community members should have already finished on the Cara 100 stocks by the time that the next bull market starts. You will have price targets in place and when you get buy alerts, you can execute the trades in confidence.

Thanks

SCEY on the move today!
They must have stuck their oars in the water....

A year or two I proposed to to create social equity, would be to somehow inject a sense of morality into corporations, or the corporate structure itself.

To create a simple law that required any corporation has to direct 2 to 5% of it's profit towards social equity concerns. by making each company act slightly socially aware, it forces the board and it's members to act more socially responsible.

The idea was shot down, since people said it would just pass costs back to the consumers. However, I still think but forcing some socially responsible "action" into the corporations ,despite higher costs, would encourage some positive social responses since some actions would happen, rather than just forcing companies to be concern with bottom line.

Perhaps even encourage this practice by rewards companies who do the best socially responsible work , with some incentives then...

Of course with this current administration I would expect this type of system I proposed would also get abused...

Just an idea to see what other think.

Gol is flying + 7.7% - GOL Announces Share Buyback and 2008 Dividend Policy

http://biz.yahoo.com/prnews/080129/nytu063.html?.v=101

No Socialism equity please. By equity, I mean the operation of free markets. Free markets equal free society, individual freedom depends on financial freedom. All other forms of access to power are conveyed through the brokers of power, to suit their desires. Money has no preference except to those who know how to deploy it. Unfortunately, this idea seems lost on some.

Its not as dramatic as all that, when you think the future may consist of the DeuxChevaux. My advice is not to give in to the revenge of the apocalypse nerds.

Several months ago there was some discussion of sharing trading methodologies amongst ourselves. I don't know if any will find this interesting, but here is what I've found works for me. Note that I have a (very) short-term time horizon; those with a longer-term perspective may nonetheless find a variation on this method of some value, as it's purpose is to identify trades with a high probability of success and clearly defined risk points.

(Standard disclaimer: Do your own due diligence. Past performance no guarantee of future results. You are responsible for your own trades; don't sue me if you try this and lose money.)

My ideal setup (for long trades) looks like this:
3-Minute Chart
Price MUST be above EMA(12), having recently crossed
MACD(13,32,9) deeply oversold and crossing upward
STO(22,12) crossing upward down around 10
RSI(14) turning upward from below 30
BOL(20,2) - price turning up/away from lower Bollinger band
It's nice if Fidelity's little red pivot point arrow has recently made an appearance.

When the RSI gets up around 65-70 or if Stochastic gap closes, it's time to think about exiting, or at least tightening your stop. Should price surge far above upper Bollinger band (say up around BOL(20,3) or 3 standard deviations), take the money and run.

10-minute chart setup is the same, but with MACD(24,48,9) and STO(14,9). Price MUST be above EMA(25) and have recently crossed to the upside.

I place my initial stop at the Bollinger band to limit downside risk.

For an example, SDS met all of the 3-minute criteria at this morning's open, and the moved swiftly from 62.20 or so up to a high of 63.33. (As usual, I entered a bit late and exited way too soon; but it was a good trade for me nonetheless.

Short trade setups are essentially the inverse of long trade setups.

Now, what I really want to know is: How does 2nd's crystal ball work?

FranSix...you crack me up..! Love the advice..."not to give in to the revenge of the apocalypse nerds". !! Too true and too funny.

Always liked bright practical hard working people...not much time for self-righteous intellectuals.

Meantime..FranSix..is the path less travelled for gold up or down ..?

Mish has a great blog today on the business of "Walking Away" from your underwater mortgage. Perhaps this kind of consumer behavior or family business decision can help create a new mindset which precipates moves toward the social equity we seek.

http://tinyurl.com/d8q6j

Correction: When I mentioned Fideility's "little red pivot point arrow", I meant "little GREEN pivot point arrow."

Mish has a great blog today on the business of "Walking Away" from your underwater mortgage. Perhaps this kind of consumer behavior or family business decision can help create a new mindset which precipates moves toward the social equity we seek.

http://tinyurl.com/d8q6j

...sharing trading methodologies ... coincidentally I was thinking along those same lines.

I bought a book by William O’Neil (Investors Business Daily) and Gil Morales with the title, “How to Make Money Selling Stocks Short”, a few years ago but didn’t really spend much time with it because the Markets were already moving up at that time from the 2003 lows. I pulled the book back out yesterday and think I will put it beside my mouse to use along with Bill’s comments and with his system of RSI’s plus g034's trend breaks.

Warning: The book is mostly weekly charts and how to use them; so, don’t go looking for fundamental due diligence or day trading techniques there. Here is the Amazon link and the customer comments might help one better decide if the book belongs in their library.

http://tinyurl.com/27zmm4

ChicagoMark ... “Mish has a great blog today on the business of "Walking Away" from your underwater mortgage. Perhaps this kind of consumer behavior or family business decision can help create a new mindset which precipates moves toward the social equity we seek.”

Possibly, but on the other hand, and possibly more likely in this land of gov endorsed usury, we might just see a return to “debtor prisons” where to keep one from “walking away” one had to pay the debt plus costs before release.

Hopefully not.

Sorry, that was supposed to read:
"... “debtor prisons” where to keep one from “walking away” he was imprisoned and had to pay the debt plus costs before release."

Sharing and Testing trading methodologies...

OLD GOAT: Tried testing the system on Wealth Lab Pro ?

Seems to work better on EOD data like Bill's RSI system...in fact..Bill..sould you like me to test the RSI system with Wealth Lab PRo on cara 100?

Need some finagling it for market conditions..i.e. RSI settings to fit downtrend /uptrend...by the way..the RSIsystem on a 30 minute chart has a 65% win-loss rate.

In structuring a society, it seems logical to make basic determinations based on both the needs of that society and the aspirations of individuals; however, they must proceed in that order, not the reverse.

First, those resources which are needed by all should be structured so as to be available at the lowest cost without regard to individual greed. Classic example: water. Most items in this category do not require rocket-science for their operation; consequently, the delivery method should be stripped of all unnecessary ruffles and flouishes; it should be devoid of the profit motive and operated totally for the benefit of the total society.

Education, while requiring slightly more innovation, also uniquely lends itself to the non-profit approach (as has been clearly demonstrated over the past 150-or so years). This area, while appropriate for both private and public sponsorship, has historically been the part of the non-profit arena, has required certification, and has had its very integrity impugned since profit-making institutions have intruded into the space.

Other items, proceeding from the most-needed to the least-needed, should be allocated to the non-profit to the for-profit sectors, and sometimes appear in both.

Once society's basic needs have been accounted for, and in some instances due to the complexities of innovating and delivering a service or product, determination of discretionary categories can proceed in a similarly logical manner to those services/products where individual aspiration is more appropriate than societal needs.

Amazing what can be done usuing an approach based on analytical reasoning rather than knee-jerk reaction.

No. Have found WL Pro too difficult to program using my parameters, though I did experiment with it a bit many months ago.

No. Have found WL Pro too difficult to program using my parameters, though I did experiment with it a bit many months ago.

Got out of my VMW puts this morning...added a little to my AMZN puts...

Looking at SKF and QIDs going into the meeting...Since last Tuesday SKF has fallen from 148 or so to about 100 seems a bit oversold (overbought depending on perspective)....

Any thoughts?

I've been adding to my SKF position as it's been falling. If it falls below 100 I'm going to back up the truck.

5.6 million shares of UXG just traded in Canada driving the price to a low of 3.52? Now trading at $3.67. That's a huge amount of shares for Canada.

BXP and SLG back below their 50 day moving averages. It's starting to look like they're churning. I may have to buy some puts before the fED decision.

Rob.

My VLO up +9.6% and FTO +14.3% on the day.
Refiners finnaly got crackin'.

SKF: Added this AM at 100.39

Agree, would back up the truck at the intraday low of 99.85 or lower.

Placed straddle on SPY 136. Move required for profit: 4.72%

Other straddle positions:

DIA 124: 4.51%

QQQ 44: 6.53%

Re: Gold

Ok, so I've repeated my outlook for gold a couple of times now. Sorry, but you'll just have to go back through the postings. Since I look at the weekly charts, not the daily, I don't have an immediate answer for anyone.

You might imagine how tough it is to buy or sell a stock on a moment to moment basis if I only watch the weekly developments.

In FXP yesterday and just added SKF. Like to see SRS dip a little more, and will be adding TWM below 75. Entering 33% allocation in ultrashorts from now into mid Feb.

Will look to rotate into commodity futures via ETFs if the commodity stocks cannot hold up.
ie Cash Cow MOO => DBA.

There is a possibility for a strong retrace back to open gaps. ~ 13K on the Dow.

Sure is dead,
ahead
of the Fed.

Fransix...no worries..not a gold trader and frankly didnt mean to ask you to rehash your weekly viewpoint on gold. was just making conversation on a sloooow day..no offense meant and may you do very well with your weekly timeframe.

Fransix...you sound ruffled..meant no offense or to to ask you to take your time out of your schedule to rehash your viewpoints on gold on the weekly time frmae. not a gold trader, just stocks..and a slow day. may your gold investments bring you fortune undreamed of in common hours.

Hello community

Looking for advice/ideas on the safest way to invest in physical gold as per Bill's comment yesterday -

"And rather than keep our unallocated funds in the form of Dollars, Euros, Yen and Pound Sterling, it ought to be in physical Gold, or in certificates that are 100-pct backed by proven physical gold, which would then be our reserve currency."

My trading capital is my rrsp account so ETF's would be easiest but concerns raised by Kaimu's posts have held me back so far....

Currently 90% cash, 10% speculative jrs...

Thanks all - been lurking and learning here for quite some time now.

Stv

"Community Kudo" to Senators Tom Harkin, an Iowa Democrat, and Herb Kohl, a Wisconsin Democrat!

Legislation introduced in the U.S. Senate last year would aid consumers in making better sense of their 401(k)s. Senators Tom Harkin, an Iowa Democrat, and Herb Kohl, a Wisconsin Democrat, co-sponsored a proposal to require that investors get more information on fees. The new law would disclose revenue sharing and other relationships between parties with financial interests in the retirement plans.

``More and more Americans are relying on 401(k) plans to provide their retirement income,'' Kohl says. ``In spite of that, there are few requirements for fund managers to tell participants how much they are paying in fees.''

Eating Better

What really bugs the senators is that 401(k) providers may strive to keep participants in the dark. The American Benefits Council, which represents sponsors of the plans and the companies that administer them, says it's not a good idea to tell investors too much.

``If they're overwhelmed by the amount of information they receive, there is the danger that some won't participate,'' says Jan Jacobson, legal counsel for retirement policy at the council.

Daniel Peterson, who advises on 401(k)s, disagrees. ``When they put nutritional labels on food, did people stop eating?'' says Peterson, a managing director at Tualatin, Oregon-based G Fiduciary LLC, which provides 401(k)s for employers. ``No, they just started eating healthier.''

http://tinyurl.com/24gdau

Rotation continues as last years favorites are being pounded (GOOG -13.5, BIDU -20.2, ISRG -23.6, X -9.5) while money seems to be flowing into homies and select financials. Gold stocks looking heavy and would move stops up on long positions going into the Fed meeting tomorrow. Commentators have said the futures market has priced in a .25-.50 cut in rates. If the Fed wanted to drive down the price of gold and hurt speculators they may not cut rates.

SKF buyers: Please excuse my naivety but, isn't the purpose of a Fed rate cut to knock SKF down?

Re 401(k) Fees:
Lack of info re fees (and a lingering sense that they unjustifiably high), a lack of flexibility in investment options, and restrictions on what was deemed to be overly-frequent trading were the factors that induced me to move my entire 401(k) out of my employer's plan and into a 401(k) rollover IRA.

Hey,,,I just had an epiphany.

Lot easier than investing

I need a Cara attorney, so we the Caraista's can be the first ones to file a class action lawsuit against HB&B to take advantage of the huge payoffs that will be made.

For predatory lending and taking advantage of us, investing our money hap hazardly and because we did not know better.

Should be good for a few 100 million..:^)

I hoping it knocks it down below 100. But keep in mind how many times they've cut it already and look at where the 52 week high for SKF is now. They can't fix the damage in the financials by cutting rates. They can sucker some people into thinking everything is rosy for a while, but reality has this way of re-asserting itself again. :-)

Some Lehman thoughts from 28 Jan 08.

Portfolio Strategy: Nine Ways to Call the Bottom

? Finding the bottom of the market is the key issue of the year. By our reckoning, the majority of our indicators suggest that we may have passed the bottom of this current sell-off. We reiterate our year-end targets with 26% potential upside to global equities.
􀂃 Price action. The S&P, having fallen by 15%, has seen a decline in line with previous recessionary falls.
􀂃 Retail selling. This has moved into strong selling territory (and we regard this as a contrarian indicator) though we have yet to see (at least in the US) retail selling reach the extreme of previous cycles.
􀂃 Put/Call Ratio. While not as extended as some recent spikes, it seems to us as if the ratio is consistent with a near-term bottom having been achieved
􀂃 Implied volatility. In the short term, spikes in implied volatility have been good predictors of positive returns over the next three months and would be supportive for near-term market returns.
􀂃 Earnings Revisions. Although analysts have cut forecasts, there has yet to be a wholesale rush to cut numbers along the lines of previous troughs. The market usually reaches a trough as the intensity of downgrades reaches a maximum.
􀂃 Valuation. Here we have a clear signal. This week's latest market sell-off, and subsequent rally, has left the market trading on 11.9x forward earnings, the lowest such multiple in the 20 years since consensus estimates
became available.
􀂃 The Fed. The policy response has shown itself to be able to hasten a trough for equities in a recessionary cycle. In this cycle, the Fed has clearly shown itself ready to take a pro-active stance.
􀂃 Cross Border Flows. Here again we have a clear signal. Our January estimates suggest this particular measure of sentiment has crossed into 'crisis' territory.
􀂃 CFTC Signal - Our short-term market timing signal based on CFTC positioning data is in neutral territory.
􀂃 So, out of our nine indicators, six are flagging that a trough has been reached, three are unclear and none is actually bearish for the market.

BasketGuy

That isn't as bad of a idea as you might think, creating a socially responsible collection of lawyers in a company whose sole job is to act as a predatory on those who are into predatory lending and are taking advantage of us.

Fiscal Darwinism :)

Do people think a 25 rate cut would cause a sell off in gold/gold stocks?

In class actions, the plaintiffs' attorneys come out on top while most of the time the class members get little.

Steve...

That is why we would use a CARA attorney(s)...We will make them split the proceeds with us...

I think that without a 50 bp cut gold sells off short-term tomorrow, maybe even with a 50 cut. My plan is to hold current gold trades into the whites of their eyes before the announcement for a spike trade and keep core position long.

That’s my thinking, however in the final analysis, I’ll trade what I see not what I think.

g034

After lurking for a year in Billworld, I signed up today because I want to express how helpful your recent examples have been to me.

I don't think class action lawyers are allowed to split attorneys fees with class members, I think there are laws and regulations prohibiting that. The court awards attorneys fees to the class action lawyers based on such factors as amount recovered, litigation success, similar cases, and attorney experience. Please correct me if I'm mistaken.

regarding the canadian gold miners: XGD.to

a few developments in the charts:

1. the 200 MA is beggining to turn upwards, while
still in its infancy i think longer term this trend along with a continually rising 50 MA is a positive sign.

2. Barrick Gold has made new highs (ABX)on the TSX and while it represents the largest single holding of the XGD, we sit well below the recent highs, w/ declining volume along the way.

is barrick simply doing that much better or are the south african mining operations hamering some producers who make up the index?

3. Slow STO and RSI 7 are to me giving no real decisive signal, neither up nor down. i dont like that kind of picture.

4. the XGD was about %6 higher when gold reached $910 a few weeks back. with gold making more record highs in the overnight markets, the XGD is sitting lower w/ a weak volume and neutral Relative Strenght reading.

this type of divergence does not bode well for the XGD historically.

5. the above being said should gold make its run to $1000 it will float all boats, the quesiton is if gold fell back to $900 would the XGD fall an additonal %10 from here, confirming the usual pattern of falling harder than the metal during plunges?

6. the XAU/Gold ratio remains low, indicating some upside resolution, or perhaps a gold price correction, this ratio seems to be mentioned more often these days as the miner's appear to be more and more undervalued. (XGD/Gold ratio is instructive as well, appears to be bottoming, but this process is a gradual one of momentum change, its been years going down, and may be some time before the traditional leveraged relationship returns)

i find this odd considering when bank stocks plunged people spoke of how cheap they were and what great investments they would now make. with gold stocks (especially the JR's) the same calculus doesnt apply, the metal is the place to be they say, as evidenced by the underperformance of the mining shares.

when will they be "cheap" enough to warrant consideration? and when this does happen will we see a massive rush and run up beyond the metal's gains as everyone tries to get in at first on value and at second on momentum?

7. a JR ive been following for years, infamous among JR gold lovers: Miranda gold (MAD.v), sitting at $0.75, down %50 since gold was a few hundred dollars cheaper, it represents to me the pinnacle of the JR shitshow currently playing out at the moment.

why mention Miranda Gold you ask? no reason other than to vent, Miranda has no bearing on the XGD other than the instructive XGD/Venture Exchange ratio which lends credence to my "shitshow" rating.

good luck gold bugs.

Ok Ok Thanks Steve...

Just burst my bubble...Maybe we can setup something in the Bahama's where the $$$ can be deposited and held in PRECIOUS gold Bars for us to look at when we visit Bill?

Sorry to burst your bubble. Hey, it's just another system set up for the participants to get theirs before their clients.

All of this discourse reminds me of a visiting Sociology professor from the Soviet block. THis was in the mid eighties when the Russian propaganda machine was still intact. It was his first visit to the United States and he'd been well versed on the dark side of capitalism as it compared to his beneficent and paternalistic socialsitic system: capitalism fostered poverty, racism, and neglect, with a repressed segment of the population condemned without opportunity. Even before arriving at his hotel, he insisted on touring the "ghettos" of Atlanta to witness the repercussions of western philosophy first-hand.

During his visit he observed, and questioned, and took notes without comment. On his last night, however, he did comment. He said he arrived expecting to see our nation's poor, downtrodden, and unrepresented, victums of bias and exploitation... the orphans of capitalism if you will. He said he found, instead, pervassive laziness in an entitled population.

Much has changed since the eighties... with homelessness, poverty is not confined to a ghetto... and, as mentioned already, we have unconscionably turned many of our mentally ill out onto the streets to fend for themselves. But we still spend a crippling amount on entitlements... just come visit my university hospital where the uninsured and illegal immigrant population recieve the best care money can provide. Just one genetically malformed, severely retarded infant born last month to an illiterate, illegal, non-english speaking migrant mother has already received over half a million dollars worth of critical care and surgery. This child will not live to adulthood. THe child will never survive outside the confines of an institutional facility. And, as I understand it, this is the third such child born to this same mother. She has never recieved any genetic or pregnancy counseling: in each case, the first time she was seen by this hospital was when she walked into the emergency room to deliver. I have every reason to believe she will continue reproducing in this manner as she has no incentive or reason not to.

Strangely, in some ways she is already better off than a mother who arrives insured. There is no contentious haggling over care to be provided or costs to be covered. This will not continue in the future, even if it should, as financial resources become more scarce.

I fear laziness and entitlement are rampant here in the US. To be sure, there is harship and pain and injustice. But I believe we have taught at least two generations now that there are no tangible repercussions to debt accumulation and reckless spending and we have institutionalized these lessons. We reward ignorance, ineptitude, and financial malfesence with unfathomable salaries,perks, and bonuses. And we parade this obscenity before our youth in celbratory fashion in the forms of our leading political and financial personalities. What other lesson could be derived from such idiocy? Of course, these lessons will ultimately prove to be foundless.

We do a lot of things right here in the US. But we have become arrogant, smug, and complacent. We are unwise in the manner that we utilize our resources and unrepentant for this mismanagement. On the world stage we are unabashedly greedy and violently self-serving. I suspect that we are just now experiencing the very beginning of many, many new and hard lessons about frugality, humanity and proper resource stewardship.

Until we stand up in unison and demand something else from our politicians, our media,and our financial institutions, US atrocities will continue. ANd they will continue right up until the US collapses beneath the unsurmountable weight of its own debt and hubris.

Vote accordingly when possible and DEMAND that your vote is COUNTED... And, as Bill suggests, vote with your wallets and investments as these may be the only votes that ultimately count.

STV

You inquired how to hold gold in your investment portfolio.

Canadian Gold Trusts
CEF 1/2 silver 1/2 gold... unallocated vault
GTU Gold ... unallocated vault

US ETF
GLD gold ... unallocated vault
GDX gold stocks

Australia Perth Mint Government owned vault
gold coins or bars...allocated or unallocated

Gold Coins from local dealer mattress

Gold mining stocks or options

Jewelry Mr T gold chains

g034,

regarding your stock analysis, I would think that a 7 year p/e cycle would not be long enough given the shallowness of the previous bear market. In fact, given the lack of any prolonged bear market over the past 25 years, i would think you'd need to look even further back.

Obviously this doesn't work for many individual companies, so maybe index p/e ranges can serve as a benchmark. Long term avg p/e on index is what, 15? In last 7 years closer to 20? And in bear markets can go down as low as 10 or so, so I would think to be conservative you could adjust the p/e range low of 20 down to 15 or so.

It would probably also depend on the type of company as some companies will see greate P/E contraction than others.

just my thoughts, but i'm a pessimist :)

someone wants this market to rally...

How to hold gold:
I think this guy has the right idea. Load up.

http://tinyurl.com/2b4hav

Social control via the markets:
1. The date of the introduction of Uranium futures on COMEX was just about the exact peak of the huge runup we had last year. Coincidence? Not even close and as predictable as the sun coming up tomorrow. This is an example of an instrument introduced solely, in my opinion, to control Uranium prices.

2. Shanghai gold futures have been lauded as gold positive, exposing gold to the huge asian gold market. Whenever one of these new gold products comes on the market I check deliverability rules. Invariably there is no delivery or severe restrictions. Shanghai futures are deliverable only to institutions, not individuals. I hope I don't even need to expound on that and why it is gold-negative.

The official reason is to avoid having individuals speculate. However, that makes no sense, as the individual is still free go 'speculatin' all he wants on the paper, trading the futures. The only thing he can not do is help ensure integrity of the instrument by taking delivery of his gold.

This is simply a way to further control gold prices while giving the illusion of a 'gold' position. Gold shorts have no fear of being overrun by a massive wave of Chinese buying, as all they need to do is make up some new 'paper gold' contracts and start hitting bids until the selling picks up steam. At most they risk having to produce a cash settlement, with no need to produce any metal.

So far the Indians seem to be the savviest in this regard - an Indian ETF 'linked' to gold (keep your eyes open for that phrase 'linked to the price of gold' - it indicates a gold-price-negative instrument) failed last year until it was altered to allow delivery to individuals.

bigboyz - you had VMW puts? Congrats! - RU buying the next round of drinks in this bar?

kp84, Leisa: Isn't the basic problem that US is no longer a "society" with responsibilities to its members. US is a "playing field" perceived to be more level than it is. If you're a "loser", it's because you're not a good "player". It's your fault!

It's easy to shatter this myth. You just have to get to know some people in a tough situation, see the world through their eyes. But, we don't do that. Only 10% of Americans even have passports, I have read. (And surely, nobody would think of having any contact with a poor person nearby!LOL).

Well, still didnt get in SFK or QID...watching for sub 100 on SKF probably will hold off until tommorrow....

Ending Day with
Short CME
LONG NMX
SHORT AMZN
SHORT GME
SHORT SYUT
SHORT GOOG
SHORT ANF

Im still looking for some more good shorts as i think this market is only in a dead cat bounce...any suggestions stocks or ETFs would be appreciated...

MikeNYC,

Too funny! Got Gold?

http://tinyurl.com/2b4hav

Bill: Let me know how I can contribute to the cost..pay pal or whatever...

Zenob, bigboyz and other SKF hunters;
I'm really uneasy about scaling into SKF pre-FOMC.
I started at 105 and look where we are now...
Thinking a morning gap down in SKF again...
I keep repeating, "let it come to me, let it come to me"; just havent' got a good hold of what that price is.
Thoughts?
Stu

Bill,
I'll kick in to help as well.

I'm starting to think we're at a crossroads in the market here. We could climb the wall of worry up to the 13500 and 2625 area or we could crash down to the 10K and 2K area.

I think we climb if the fed cuts by .25 and the bond insurers get bailed out. In this scenario, the FED would also be supporting the dollar in the FOREX markets, thereby lowering commodities.

On the other side if ABK or MBI fail and the FED cuts .50, I think we start racing towards the floor and Gold shoots the moon.

Anybody else have a likely scenario they looking for.

Rob.

The question of financial support has come up before and I recently came across one way people might attempt to 'donate' money to Bill's cause, though it would of course still be up to him to accept.

My bank(RBC), and I'm sure others, have an 'email money' feature where you can send money to someone over email. Specifically, you set it up as a funds transfer, specify recipient as an email address, specify a passcode (question to which bill would know the answer) and done. Bill gets an email, and if he wants, follows instructions and cashes in.

Bill, if you shudder at the thought, feel free to delete this post.

You SKF guys know that if the FED does cut even .25 that helps financials.

And as Bill has said he doesn't see the financials going that much lower until the next big thing happens like MBI or ABK going under.

Be careful. Those ultra's can move very quickly.

Rob.

Seeing very strange trade in my gold junior today.

3X normal volume and anonymous trades selling into the bid.

Activedollars noticed that the market was stronger today than the bears expected

Activedollars also noticed that they took advantage of the strong Durable goods number to move the market up through a downtrend line.

Rumor about JPM in trouble on derivatives and then the obligatory denial was a nice ploy - to keep the wall of worry in tact for the day.

Tomorrow's advance GDP in the a.m. - to justify Fed's action in the afternoon?

Activedollars does not like shorterm trading around Fed meetings.

But is anyone considering this scenario: Fed doesn't cut - market rallies anyways?

proudpapa - thanks for the reply.

7 years would include back through 2001, but does not include the peak in 2000. Would that P/E be an outlier in bubble and skew the data leaving the median P/E too high? I prefer to see as much data as possible, but some research firms only show 5 or 7 years of P/E history. I used 7 years to induce discussion, which we are getting.

thanks

not median, avg

Who is activedollars?

My limit order didn't fill today so I will be waiting till after the fed's announcement to add any more SKF.

I'm still kind of newbish but the way I'm looking at SKF is that most of the move back from it's 52 week high is just vapor. I think it will move past it's 52 week high before we see a bottom in the financials. That gives it HUGE room to move from where it is presently sitting. That's why I've been adding on the down ticks and will really load up on a sub $100 price. I had my limit order set today for 98. If we get a good bounce off the fed's news I might be able to steal it for 95 or lower. But I don't think any kind of bounce will last long. There is just too much unresolved damage in the system still.

Plus, if the fed does only cut .25 I think the market is so convinced that the fed is going to cut .5 that it would react negatively and sell off rather then rally. Like I said though, I'm still newbish so I could be wrong. ;-)

dr. cosa found a website currently under construction:

http://activedollars.net/

dr. cosa wonders if this is a coy attempt to raise awareness of activedollars before eventually linking people to an outside website.

dr. cosa has seen this many times before and before he rushes to judgement he will watch carefully because activedollars has posted reasonable observations thus far, unlike dr. cosa's own ramblings on Gold.

Zenob..

Be careful with your short side in SKF. Yes we may see a quick POP in SKF after the announcement if fed only cuts by .25, but that may be short lived and continue its downward slide.

I too believe this market is headed into the abyss, but I feel the short term bullish side building and I feel you should wait to see what happens.

Your plan may work by buying on the dips, but it will work so much better is you wait till SKF is back in the AZ and then start your avg. in...

Right now you are trying to catch a falling knife, wait for it to find its own bottom then back up that truck...

dr. cosa,
I just conducted the same search as you. I found it irritating reading "ad" messages in third person. I also reserve judgement and ask "ad" if he/she/they would consider referring to itself as I.

The English language is blessed with many useful and totally un-annoying subjective personal pronouns.

ALOHA !!

I believe not even "democracies" work! Like Communism or any other "ism" sooner or later the leaders get rich on the backs of the masses. The only solution in my mind is a "Republic" where less and the most minimal government is law. What makes anyone believe that sending your hard earned money to Washington DC solves anything? What's been solved so far? Its the same old bankers and politicial elites at the top that benefit most.

Over the past couple days here in Australia there have been some protests about dredging a harhour in Melbourne. The protesters are in kayaks and boats. They fear their enviroment will be destroyed. I love how the First World citizens have the collective mandate of consumerism to dictate where the pollution resides. NOT IN MY BACKYARD-NIMBY! The protesters of the dredging consume massive resources yet they want no repurcussions in their backyard. I love people with their I-Pods and Blackberrys driving their BMW SUVs lectruring me about the ills of the mining industry. I have never understood such self serving and vane logic. Someone please show me somewhere in the World, especially in the First World where there has been less consuming? Now we have billions of Chinese and Indians clamouring for more consumerism while we here at the top of the CONSUMER PYRAMID lecture them about their sins! Nobody wants to feel the "pain"! I am the only one of my friends who have "downsized". I am here to say it was not "pain" ... it was "joy"! I was criticized harshly for my decision to pay off all my debt. The usual advice I got was ... "Use that cash to leverage profits" ... "You'll lose you mortgage tax deduction" ... "Put it in your 401k" ... All a load of crap advice. I could not have done myself a better service than to do away with my home and business loan. It has been my experience that getting off the debt "grid" the debt "matrix" has been 100% pure joy! I highly recommend it. I feel a freedom few will ever experience in America or even here in Australia. Many times I hear about "debt prisons" and "the company store" analogies ... As long as you have a loan you are owned! If you are owned then you are a "BANK PRISONER"! As long as you are ignorant about "money" you are in prison. FIAT IS PRISON ...

GOVERNMENT IS ONLY AS HONEST AS ITS MONEY ...

You cannot have social equity when you have dishonest money!

Australians have not a clue who RON PAUL is ... They see Ted Kennedy on TV yelling for CHANGE by electing Oprah's "chosen one" ... OBAMA! There is no worse endorsement anyone can have than Ted Kennedy. I wouldn't even hire him to water my orchids ... somehow he is in Congress!!! Go figure ... The two party aristocracy is in full SPIN mode!!! BEWARE ...

Gold juniors in China -

Kaimu has written that he'd never own a junior staking much of its future on China. He may be right - categorically!

This week's Economist tells how the Chinese gov't has frustrated Rupert Murdoch's designs for that market. They let him invest, and cultivate talent, build an organization, but ultimately NOT to put dishes on Chinese buildings or otherwise reach Chinese households. They learned from him, and beat him at his own game. Murdoch's only consolation prize was a Chinese trophy bride!

The man who created SKY B'casting, bought the Times, built FOX-TV and the WSJ - flattered politicians with his editorials, and got what he wanted -- except in China.

Just as media comprises a strategic sector for China - so too gold! China just surpassed S.Africa as the world largest gold producing country.

Most likely, China will allow western gold explorers to invest, to explore, to find gold - but aren't there a thousand steps along the way to a profitable mine where Chinese could wrest the benefits from a western gold company?

ALOHA !!

I believe not even "democracies" work! Like Communism or any other "ism" sooner or later the leaders get rich on the backs of the masses. The only solution in my mind is a "Republic" where less and the most minimal government is law. What makes anyone believe that sending your hard earned money to Washington DC solves anything? What's been solved so far? Its the same old bankers and politicial elites at the top that benefit most.

Over the past couple days here in Australia there have been some protests about dredging a harhour in Melbourne. The protesters are in kayaks and boats. They fear their enviroment will be destroyed. I love how the First World citizens have the collective mandate of consumerism to dictate where the pollution resides. NOT IN MY BACKYARD-NIMBY! The protesters of the dredging consume massive resources yet they want no repurcussions in their backyard. I love people with their I-Pods and Blackberrys driving their BMW SUVs lectruring me about the ills of the mining industry. I have never understood such self serving and vane logic. Someone please show me somewhere in the World, especially in the First World where there has been less consuming? Now we have billions of Chinese and Indians clamouring for more consumerism while we here at the top of the CONSUMER PYRAMID lecture them about their si