With the US dollar falling down a precipice, spare a thought for non-US investors invested in US stocks and bonds. My latest post highlights some interesting graphs, comparing US dollar and euro returns.

Here is the link: http://tinyurl.com/3yculk

TGIF

I watch Platinum too Bill.
We have commodities extremely overbought and stocks oversold.
Seems very dangerous here..

By the way, this THORNBURG debacle is what is wrong with America --> GET MINE AT WHATEVER THE COST. And thus, pervades across to the top of the system in politics/banking/finance etc wherein these people DONT CARE about stranger they dont know i.e. fellow countrymen here.

Which is why I like Ron Paul,..he cared and served the people he will never meet. Was his greatest quality I thought.

..and you you too Bill!

A race to the bottom??

Rupee hits six month low against dollar while the $Dollar keeps making record lows. Kinda brings back to mind that old, slightly famous ad in which the key line was: "Please help me! I've fallen and I can't get up." History records the horrible times of the "Black Plague" when it spread throughout the known world; wonder if this will be called the time of the "Bank Plague"?

Link to article..
http://tinyurl.com/3dqq3g

Good Morning!

This is what I am hearing to as I write this post:

http://youtube.com/watch?v=1HdGUNm6-qI

Yesterday I was away from my desk all day, as I drived multiple kms to visit several large shoping mall stores of a large institutional Client of ours which runs an European wide chain of large retail stores selling books, media, gadgets and culture.

The news is that most shopping malls were semi-desert, with only some youth sitting around in corridors and some older unoccupied people walking around, on the outside of stores.

As I talked with the store directors of this large chain, all of them complained that since January sales have basically come to a grinding halt, and not even offers of 0% interest credit are luring buyers anymore.

This is Europe today.

Now, re PoG:

My English is not good: how do you call a spring that is so contracted that it may jump at a minute's notice?

That's how I see gold right now.

With the USD in the tank, and a serious open short interest, there is litle doubt tha PoG will jum sometime.

You know, many times al it takes is a seemingly low relevance event to trigger buying.

One such event can be something like today's US employment report, coming up in about 30 minutes.

So, for gold bulls feeling apprehnsive: keep cool and keep your arms wide open to the new world.

Have a good one!

Cheers!

Maromatics:

Your English - or whatever language you're writing in on this blog - is great! very accessible commentary...I watch for it.

Many thanks.

Regards

joey

The Fed just announced that they will increase the size of the term auctions. They are, ahead of the jobs report, announcing an injection of liquidity. This can't be good....

Loss of 63000 jobs in Feb. Then Jan and Dec revised down. That ain't good for the US outlook....

DJIA 11,989...

101000 Jobs lost in the private sector in Feb. but a growth of 38000 in gov't jobs for the total loss of 63000 jobs in the month of February....

non-farm down 63,000

where's the next SP500 support level or where might it test down too ?

38,000 hired at FDIC...

gold making a run for $990,
USD index falling towards 92.50

will gold stocks break away from the rest of the market's slump this morning? hope so.

good luck.

gold up 12.50...

DJIA 11,941...

GS bid 156.10...

Looks like goldilocks woke up with morning sickness! Something tells me she is already in her second trimester of pregnancy--oops, i meant recession.

DDM/SSO/QLD...at bat...

Good Morning.

One Downgrade to report at this time.

INFY downgraded to Hold @ Kaufman Bros.

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

Should be an interesting day in the markets and a great day here on the board.

Ambak down 12% in PM, Ambac said it sold $1.25 billion of common shares at $6.75 a share, or 9 percent below their closing price on Thursday. The stock offering nearly tripled the number of Ambac shares outstanding.

The company also sold $250 million of mandatory convertible securities, paying 9.5 percent per year and with a conversion premium of 18 percent. Those securities convert to shares beginning in 2011 - if the company still exists by 2011.

Sorry to be crude, but I think goldilocks woke up this morning and immediately reached for the KY & Preparation H!

Definitely going to be an interesting day!

great discussion yesterday of the other precious metals...I would suggest looking up jack lifton at resourceinvestor.com for some more info.

re: rhodium - I remember buying my wife's engagement ring on 47th st in nyc (1998!, and having the jeweler coat it with rhodium on the spot...he had a chunk of it that was the size of a soda can! I can only imagine what it would be worth now.

aurator - antimicrobial silver is going to experience some backlash...the EPA is looking into its use because it might end up being a contaminant and human health hazard. Not sure how much silver is used for this, but it might not be part of the bull case for much longer.

oh, and whatever you do, don't use silver for
this...

http://www.foxnews.com/story/0,2933,317564,00.html

TMA/CFC/FMT have been the perfect poster companies- stylin' and profilin'->lying and denying->capitulation...closing in on time to buy-> SSO at 64.11...

So the Ambac news is out of the way, as is all the absolutely terrible economic news. The SPX is nearing a critical support level (see http://www.price-trend.com/).

Do we get a rally on all this bad news or do we find new lows? That's the question of the day, as is the weekly prospect of some unexpected news event that spikes volatility to the detriment of anyone without advanced warning.

Re: Sinclair

First TRE (TNX) is a very speculative stock. I own a small position at 1.03 in certificate from which I have never sold. I have traded it a lot since that time via my broker, buy weakness selling strength. Someone once asked Sinclair how long before TRE pays off. He stated “ten years” that was about three years ago.

What kind of person is Sinclair? I think I can answer this by saying he is a teacher for all who care to learn. He will freely give of his time and knowledge although it is clear it is becoming overwhelmingly difficult for him to respond to all. Years ago I would send him charts of my trend lines, how to calculate triangle projections etc of various gold stocks to check for validity of my knowledge in practicing his method’s of TA. He would send them back to me with corrections and comments as necessary. I was a complete stranger to him. He said that I was his 228 student doing this. By the way I consider Bill a teacher too.

Sinclair has just been dead on in his calls. Here are some excerpts from late 2006:

1) In 2007 and 2008 that monster slush of dollars is going to find gold. It will find gold because, as reported today, central banks are beginning to sell dollars, not just simply stop buying them with a preference for Euros etc. Keep in mind central banks hold few dollars. What they hold is dollar based financial instruments.
The footprint of this change is forming, and will take shape in my opinion no later than January 15th to January 29th. Thereafter gold will go to $750 and above to $1000. This is not the “end story” of the price of gold, but only chapter two of this classic story known as the “Generational Bull Market In Gold.”
2) Dear CIGAs:
You are about to start a brand new year. A year that I have waited a very long time for. This is a golden period that I believe will be the best of my personal experience. I am offering you, in the following, what I see as the entire story. It will be added to in this general form until after the first business day of the New Year.
Assuming you take the little amount of time required to understand the following then you are locked and loaded for 2007 and 2008. You have to congratulate the powers that be for having camouflaged the entire economy as expertly as they have done. Hiding the real facts, changing the indices so they read only what is preferred and spinning both economic and geopolitical news created markets that benefit those who made it all happen in the first place. “Mum” was the word because those that knew and those that got the message were those who this entire charade benefited. Those that are still in the dark benefiting from the bull market in equities and bonds never gave a damn what made it happen. Most of the experts dragged out on financial TV would put their mothers in a microwave to make a buck.
The world is broken down into those that give and those that take. The major abusers among those that take are in the financial world. Believe me, I know!
It is not that these people are immoral, they are world class amoral. As a group they are the only living heart donors. They even pride themselves in their dastardly deeds as if he who has committed the greatest sin, usually against their own benefactors, is the “Master of the Bonused Damned.”
Now the political change of the legislative guard will put this “Illusionary Prosperity” into a position where the light of day will soon shine on the powers that be. This light will not be motivated by altruism but rather another group of dastardly doers. It is revenge that will publicly, in an apparent cleaning of the house, uncover the rot of the takers within.
2007 and 2008 is the beginning of the end. The final chapter is played out from 2010 to 2012. Gold is going to all the 4 Angels and possibly more as leak in the dyke after leak in dyke misses its finger.
3) I have never had a problem with putting my cards on the table specifically. My opinion puts all this in first gear in the period of January 15th to January 29th 2007.
I have given you all the tools. For those that joined the Comets and CIGAs only a short while ago there are many articles in the compendium teaching the most simplistic means of executing the following Bull Market Strategy. It is however up to you to apply them, not demanding of some expert (God save us all from experts) to hand you profits in a basket for $19.95 a month.
You have to do it yourself, just as I have had to do it myself all my life. It is that experience refined into simplicity that I offer you. You are free to use it, abuse it, crinkle it up and throw in on the floor if you wish.

“Knowing is not enough; we must apply. Willing is not enough; we must do."
-- Johann Wolfgang von Goethe - (1749-1832)
1. Sell 1/3 into strength only, TA guided.
2. Buy back that 1/3 on weakness only, TA guided.
3. To sell a trend line break down means you are selling weakness and have not sold strength. Do it often enough and you will have nothing to do anything with. Gold is either in a bull market or not. It is in a generational bull market from my perspective.
4. Practice the Green Doctrine.
5. Take the 30 minutes that is required to learn all I have offered in the “keep it simple” TA method.
6. Fundamentals precede Technicals. If the Fundamental cases do not support the Technical cases take a pass.
7. Think for yourself. Walk away from gurus, run from experts.
Do not try to convince anyone of your position. All you need to be is right and silent.
4) Dear CIGAs,
I have waited 26 years for the next major explosion in the gold market.
We are, in my opinion, directly on the doorstep of that occurrence.
I have stood up to risk to make my point on more than one occasion.
I know of no other commentator on gold who has been willing to take one penny in risk standing behind his or her published views. This is most certainly true when I pay six figures to do this service on behalf of the community.
Let me tell you the rush in to get a free put from me on up to 200 bullion coins was like a freight train coming down the track. If I had been wrong about the gold price, I would have been buried up to my eyeballs in coins and out a major chunk of cash.
So here is another promise. I am telling you that we own 2007 and 2008. If I am incorrect about this then this page will close down with my apology. I firmly believe I will be around until 2012-2015 and gold will be way into the four figures.
Let me define what right is. It is a new high in gold above $887.50.

During this period of time 2007-2008 I expect:
1. Gold shares will return to their traditional asset based valuation. Prices will be made by what you have under your feet, where you are and how advanced you are. In general they will be multiples of what they are presently, some ten fold.
2. China will stand up to the US in economic and political matters.
3. The US Treasury International Capital report will go below the zero line.
4. The cost of the Iraq/Afghanistan conflicts will skyrocket both in $$$ and lives.
5. The NATO Coalition in Afghanistan will in practical terms break down.
6. The Federal Budget Deficit will sky rocket.
7. The US dollar will trade down to .7200
8. Consideration of a North American currency, a natural outgrowth of NAFTA type arrangements, akin to the Euro will be discussed, but will not happen.
9. The USA will go from black ops to full engagement in certain South American countries. The build up has already started.
I intend to work on a paper for you to be presented early in the New Year on why all of this is going to occur.
I have waited 26 years for this opportunity. Within a few weeks it will start. These are the Golden Years coming again. A second opportunity in one life time to tag-em and bag-em in the gold market is sitting there waiting for us.
5) My comments on number four. Did you read the above, if memory serves me he agreed to cover up 200 oz’s (for any and all people who wanted to take him up on it) but before a certain date and personally guarantee that the price would not drop below a certain price by a certain date or you could “put” the bullion coins to him and he would cover your original price.
Next he states that if gold does not hit 887.50 in 2007/2008, he will shut down this site and apologize to us all.
That’s conviction ah a big set of you now what.
The man simply has experience and uncanny sense of where the gold market is going.
If you trade or invest in gold do yourself a favor read, listen, and learn from this man.
One last point, when the Hunt brother’s cornered the silver market and lost their shirts, Sinclair was the one they tasked to unwind their positions, or so I’m told.
This is all I have to say about Jim Sinclair, if interested the rest is up to you. T3D
Willa, I do not know the answer to your questions. Sorry.

Is there a chance we are close to a near-term low?

The Investor sentiment bullishness index is very low,the put call index is very high, VIX is heading higher.

World is waking up to a case of "Bank Plague". China too, although China is talking a different game for handling its inflation. Of course, our game must be better because we have a strong Fed to protect our $Dollar.

"China confirms inflation enemy number one"
http://tinyurl.com/2tjukj

ennar- i don't know, but depending on your time horizon(s) i would keep position sizes small until things play out in your chosen direction(s)...certain it will not be uni-directional...

Cara 100 Update:

JCP Target Price Lowered $56 to $55 @ BMO

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

MRVL being brutalized

I am gld I do not have anything but cash
This is scary
all post here are great
and i love to read all of them

QLD closing on in january 23 low of 64.53...

Here is a short term technical call by a guy that has apparently been calling them spot on recently:

http://blog.stockmarketharmony.com/

He says look for double bottom trading low at 1266 or 1274 with a rally off that level. That is around the intraday lows in January so it makes sense.

vinod- glad to hear that...just make sure you don't repeat those comments walking home next to the dark alleys of boston ;)

This just out from the Fed:

http://www.federalreserve.gov/newsevents/press/monetary/20080307a.htm

Again, they're trying to solve a liquidity crisis that is rooted in lack of confidence and the absence of a bid by printing money that depresses the ask.

Nice work.

trying a little QLD at 64.74...

watch GS and GOOG coming off the lows-> are they still tells?

Rob D:
Yikes! Maybe the fellow could join that Vegas act. He'd fit in well at a Viking's home game, too.

There's going to be a good shakeout today.

BG- don't laugh, man...buying SNDK at 21.75...

Good call 2nd...

PPT rushing money into the market as fast as Ben can print it.

QLD and SSO-> clearing out at 64.70 and 65.74...(day job calls)...good luck...

switch the above numbers....

if this is a trend- up day I'll be shorting the close with vigor

Dave

This is no capitulation or panic....there will be more to come.

VIX never saw 30, too calm.

Covered my SRS short.

Bill:
I am changing the subject briefly from the debacle at hand to respond to this generalization of yours:

“Just another thorn.” How many more companies
are in the same situation? Likely all of them.

I assume you are speaking of the universe of mortgage lenders and wonder if the universe includes Canadian listed stocks. If it does, I wish to speak up for Home Capital Corp - HCG.T - market cap $1.36B - and distinguish HCG as an exception to your generalization. I own shares and have for 7 or 8 years - more than a 10 bagger for me - tho' I lightened up considerably recently, as I am learning that a retreating tide is wont to sink or strand most boats - even the seaworthy.

Here are highlights from the FY07 release of results
-diluted eps +32.81%
-ROE +28.9%
-Asset Growth +27.4%
-eff ratio 27.1% a yoy improvement
-net impaired loans .72%
-liquidity position increased markedly yoy to $627.1m
-dividend increase - the 3rd, I think, in 2yr

Confidently guiding for 2008 - the usual benchmarks for this company - 20% growth in total earnings, eps and total assets; and >25% ROE
Recollection - they missed this benchmark once in the past forever years, a year or so ago when interest rates were a hugely moving target and they got caught on their spreads - and the stock sold off hugely - tho' they still had positive double digit results...just not 20% across the board.

HCG, imo, is a beautiful rose; and I am hoping to add to my bouquet, when the florist puts her on sale.

regards.

jaketh - he could be a permanent member of the Blue Man Group!

The writing in bold letters about the loss of 63,000 jobs has a very clear outcome for the people that don't live behind iron gates. Don't worry it will take a month, but those numbers will be revised just like the Labor Dept has for the last 13 months!
It's going to take more then a government "tax hand back" disguised as a stimulus package to keep crimes of survival from escalating. Don't know if murders are on the increase yet, but I have a gut feeling they may escalate if the jobs don't come back up soon.

Thornburg Mortgage has a 52 week high of $28.40 and now trades at an over valued $1.41

Etrade has scored 9.9...9.9...and 9.9 on all the judges cards, the only thing that kept them from a perfect ten is the splash from the belly flop wasn't big enough!

Carlyle Capital Corp. (CARYF), a unit of the Carlyle Group, saw its shares suspended after it failed to meet margin calls.

craig- any bets on whether we got our rally and now we go down?

CEO SAYS THAT COMPANY HAS ENOUGH CASH TO COVER WORST ESTIMATE OF LOSSES
- Says Company has $16.5B in claims-paying resources, which covers the worst case scenario of $12B in losses, reassuring that company had sufficient cash.
- Says "has not been authorized to at this time disclose the firm names that did the deal."
- Says "there's no question there has been a erosional confidence in ABK by customers."
- When asked if ABK has written ANY new business in the past several weeks (CNBC) CEO did not answer the question.

CERBERUS bough 50M in shares in ABK

Joey,
Outstanding presentation on HCG.T. I think you learned something about advocacy from listening to all of those pitches at PDAC.

I watched American Greed on CNBC the other night. The first half hour was about Bernard Ebbers of Worldcom. I remember those days so vividly. At the time I believe WCOM was one of the top 5 most held names and evey fund owned them.

I owned it, clients owned it, albeit not much. As negative news on WCOM was coming out and the stock was dropping Ebbers would trout out and with the most honest face tell you that things were fine. He even stated on air to Maria Bartiromo that there is nothing to the SEC investigation and swore on his life.

The analysts like Jack Grubman were pounding the table day after day to buy. I remember thinking what could happen here, this is the 3rd most owned company out there? The CEO is publicly saying everything is great.

At the end of it all I felt so cheated, violated and lied to.

I see all the same things happening again. As someone who is very close to this industry I trust no one and nothing.

Very few of my brethern feel like I do. I see them all making the exact same mistakes and saying all the old same things. I ask myself how could this be happening all over again just not even 8 years later? Did they forget their sponsors lied to them? Do they really think these people are working in their best interests?

I have come to the conlcusion that it's part of human nature and we all believe what we really want to beleive.

I hope this thing doesn't end as bad as I think it could. Me, I am close to going into self-preservation mode for me and others.

I can't seperate out the liars and crooks from the honest one's.

Once we get through this it will be another couple of years of industry class actions.

Sorry just need to rant here.

Let me also add that Argus research is horrid. They are independant but their talking points lately are as if the Fed themselves are authoring them. This morning they found cause to celebrate the jobs number.

"Perhaps the most encouraging statistic was the drop in the unemployment rate to 4.812% — the lowest level since November (4.668%). This was much lower than the Street consensus, which expected an increase to 5.0%, but in-line with our estimate. We have always looked at the unemployment rate as a better barometer of U.S. employment conditions as it is mostly comprised of small businesses and self-employed workers. Small businesses represent 99.7% of all employer firms".

maro, re gold. I'm tending towards Bill's when the liquidity drains, gold is just the last one on the dancefloor thesis. It's at nosebleed levels already. I hope people don't start running in at this point. Mind you, I'm a total bull on it and have been in for a while myself. Think the gold juniors look good though....

2007 CEO Compensation
They all come from the same gated community as Bernie Ebbers and Kenneth Lay.
Hope the margins fit type key, I copied out of a word document I made the other day.

Rank Name Company Pay($mil)
1 Richard D Fairbank Capital One Financial 249.422
2 Terry S Semel Yahoo (YHOO) 230.555
3 Henry R Silverman Cendant 139.96
4 Bruce Karatz KB Home 135.53
5 Richard S Fuld Jr Lehman Bros Holdings 122.67
6 Ray R Irani Occidental Petroleum 80.73
7 Lawrence J Ellison Oracle 75.33
8 John W Thompson Symantec 71.84
9 Edwin M Crawford Caremark Rx (CMX) 69.66
10 Angelo R Mozilo Countrywide Financial 68.955
11 John T Chambers Cisco Systems (CSCO) 62.99
12 R Chad Dreier Ryland Group (RYL) 56.47
13 Lew Frankfort Coach 55.99
14 Ara K Hovnanian Hovnanian Enterprises 47.83
15 John G Drosdick Sunoco 46.19
16 Robert I Toll Toll Brothers 41.31
17 Robert J Ulrich Target 39.635
18 Kevin B Rollins Dell 39.315
19 Clarence P Cazalot Jr Marathon Oil 37.48
20 David C Novak Yum Brands 37.42
21 Mark G Papa EOG Resources 36.54
22 Henri A Termeer Genzyme 36.38
23 Richard C Adkerson Freeport Copper 35.41
24 Kevin W Sharer Amgen 34.49
25 Jay Sugarman IStar Financial 32.935

2nd: I think we see more selling. I think the rally is to pump and dump.

I've been in and out of SRS short several times which is working so far. Now it's a long again.

I used the pump to sell into and to short SRS
and was also in UYG....was unbelieveable, but a trade none-the-less.

Williams % R is my friend today. Watch trend, let W%R tell me the strength of the move and possible turning point.

Just playing the volatility and waiting to see if we close below 12000. If so I think we see 11200 at some point, maybe the 10000+ number.

craig- i'd be playing the short side now...unfortunately, my schedule today does not lend itself to intraday trading...100% cash right now...good luck...

Cash (or cash equivalents) is good!

Funny you should call the short side....W%R 90-100 on the indices/XLF....and the numbers say.....LOL!

Watch for what happens as we probe lower and test the opening lows...

Very bearish article but this guy has been right so far, as you will see from the article:

http://www.minyanville.com/articles/GS-BKX-C-jpm-bac-fnm/index/a/16181

Also, Prof. Depew thinks Bernanke's last speech was setting the groundwork for nationalization of Fannie and Freedie.

I think that investors have become all too trusting of what they are told, even with the frauds at the beginning of the decade. People should concentrate on minimizing risk, rather than on potential reward.

Very important to the condition which junior mining companies operate is the availability of financing. A very large going concern is going to have trouble raising large amounts of money that they need, while a smaller operator can rely on close contacts within the industry if they need it, solely because their financings will be an order of magnitude smaller.

Case in point:

NovaGold Not to Proceed With Offering

March 7, 2008 - Vancouver, British Columbia - Further to yesterday’s press release, NovaGold (TSX:NG)(AMEX:NG) has decided not to proceed with its previously announced financing due to pricing conditions.

http://www.novagold.com/section.asp?pageid=7152

This makes NG vulnerable to takeover at a lower price than the market would fetch.

Readers,

This week the SEC held an Open Meeting on a newly proposed anti-fraud rule (10b-21). We have taken the open meeting and converted it to written transcript. When you see in print what was stated you really have to wonder what is going on in Washington.

http://investigatethesec.com/drupal-5.5/node/225

Some excerpts;

Chairman Cox:

“Periodically there are reports that following a legitimate purchase of 100% of the outstanding shares of a microcap company, millions of phantom shares continue to be traded by naked short sellers.”

“Reg SHO has accomplished a good deal, but our experience has shown that Reg SHO can’t be effective without enforcement. The Commission’s Office of Investor Education and Advocacy has received more than 400 investor complaints related to short selling of this kind in just the last year. The Commission continues to hear from business leaders and policy makers on this issue as well because of the injury that this kind of fraud inflicts on investors, on companies, and on our economy.”

Market Reg. Director Eric Sirri:

“The elimination of the grandfather exception to Reg SHO’s closeout requirements became effective October of last year, and the one time, 35-day phase in period for that rule amendment ended on December 5th of last year. The staff has been closely monitoring the impact of the elimination of that exception on failures to deliver. Preliminary results indicate that failures to deliver have not been significantly reduced."

Commissioner Atkins
" I know in my own experience, before coming to the SEC, there have been instances of, I think, or at least where it seemed like there was a concerted effort to try to send in a lot of calls to prosecutors and to the SEC, and then to work with forces in the marketplace through shorting and whatnot to try to drive down target company stocks, and try to drive them down."

RE:Rhodium

Aurator and others were talking about Rhodium last night.

Sifting through my PDAC papers and notes, I've come across a fact sheet for Starfield Resources (SRU.t) which one of our colleagues urged me to check out, as he likes it a lot.

This sheet says it's an advanced exploration and emerging early stage development company...Ninavut, Canada...it has a base metal (nickel-copper-cobalt) and PGE (platinum-palladium-rhodium) project...they released a NI43-101 report last july and are working on a feasibility study and continuing exploration this year.
My hen scratch here says '$13.7 million cash'; so I assume my dialogue with the male company rep. included my standard "before we get acquainted, show me your bank book."

That's all I know at this stage; but SRU appears to have a compliant resource which includes Rhodium and they are preparing for mine development - eventually.

Why does the word smarmy come to mind while watching Mozilo adress Congress?

vinod Where were you Monday?

Hope you all don't mind if I bring a bucket in my office to puke after hearing all these wealthy liars testifying, I mean, reading their overpaid legal firms trumped up sob stories....poor Angelo.
I feel so bad for him, afterall he only made millions of dollars ripping regular working people off.

The idea still seems to have a lotta legs on this thread that a big bad is coming. Am I reading us right?

Peter Grant...a big bad or a big good is up to the market...or you can follow the sentiment here..follow it or trade against it. :)

Either way ..watch how the market behaves at
$SPX 1291, 1265 and 1307.

Do you believe in America...? Land of the free and home of the brave?

Or would you rather believe in yourself...?

Well, do you feel lucky...? Sounds like you need a personal system to navigate the markets...otherwise..Tom Hanks on a raft with no volleyball..

Eemtrader, nice response. I'm developing my system, thanks, with help from you and team.

Excerpt from today's Congressional hearing:

"I was the first member of my family to attend public school. Having been raised on a hog farm in North Carolina, It was a big step for me the day I was hired at Mega-Bank as the token dirt-farmer. As I child I used to awaken at dawn to help pop slaughter the hogs, as well as my 11 brothers and sisters. I used to defecate in an unheated shack at the edge of an alfalfa field and the only friends I haf were the pigs and chickens whose company was of course, fleeting. when I came to Mega-bank I was actually the only person among thirty five thousand employees whose skin was darker than a pale pinkish color. I began in the car poole, detailing, waxing and making sure the cars were fueled up for the big guys(and if you've seen stock traders, they are REAL big guys usually) and slowly, over the next 30 years I got at least one piece of dirt on everyone above me in the corporation. My big break came when, while chauffering one night for the ceo, I snapped pictures of him in the backseat with a woman not his wife. And from then on, my succession to the helm of Mega-Bank was pretty much assured. Now mind you...I didn't know a CDO from a CD. I didn't know a mortgage bond from James Bond. And that is why, when it comes to the trillion-dollar losses that occurred under my watch, I can say with absolute certainty, I knew nothing...absolutely nothing about it. Still don't. In fact, why don't you guys grill the human lizard over here and give an old dirt-farmer a break."

Seamus,

Smarmy?

You have to read this mortgage brokers' deposition:

http://tinyurl.com/2c289m

Shark...please, please. ROFLMAO. Please tell me they said thanks for telling the truth and let the poor farmer go (back to the OPM trough)

Risk keeps climbing as credit issues spread from mortgages to ARS to Munis to banks to hedge funds to municipalities to ...? Who is left?

Credit markets lead the equity markets. But as EEMTRADERS says just watch what the market is telling you.

My system is to recognize the risks first so I know what to avoid and whether to sell short at resistance or go long from support. Looks like tech is trying to rally from these levels while materials are rolling over.

ALOHA !!

FranSix ... That is the very point of my article on MICRO MINING. Below is a link to my article published in Ghana, West Africa and GATA in USA.

See link: http://tinyurl.com/ys68fy

The two companies I reference are PMI GOLD(PMV.V/PMVGF.PK) and GOLDER ASSOC. a mining engineering firm.

Peter Grant...not trying to be funny.if you are not sure.stay out of this market...if you have a system that is reliable..navigate with small positions...lots of money making opportunities...

I understand the traders on the street are having a heck of a time navigating these markets..some on here have done really well...

how in the world is someone going to figure out who to listen to or not without:

1) Examining their system
2) Examining their results in different market conditions.

Just being ruthlessly honest..

Now you know why Geckojb was suggesting the covestor site..but results without demonstrating a system is even more dangerous...short term profits can blind a trader/investor to the flaws of a system...

Listening to Mozillo testify, it is "clear" that these congressional hearings are a farce.

HEADS UP - 3 rd test of $SPX 1293...in under 4 hours..

quote by one of our elected officials to the CEO's in front of the Congressional Committee.... "I am proud to be here with these people who run the country...I mean who run the great businesses of the country
OPPS that was a truthful slip

Eemtrader, I appreciate, respect ruthless honesty. I never travel without wilson.

EEM....

Well you and I doing the same dance...Just wondering what happens when we get there..

My crystal ball says bad things for Monday..When Asia can start trading our jobs numbers...

If we close way down today..How many people will be calling their brokers on Monday to GET ME OUT ...

11896 on the dow

BG : My psychic with the plunging neckline and shrinking waistline agrees...and she constantly reminds me we are oversold..and shortly getting down to T2108.....levels...

oooo...spy testing morning lows...

EEM///

Ah Worden Makes it soo easy when we hit 20 or below...

BUY BUY BUY,,,

Sovereign Wealth Funds are handing cash to the HB&B are a pace that will just keep their nose north of the water line.
You can't convince the out of work people that those Sovereign Wealth Funds care about an unemployed worker in the good old USSA.
After all in their mind women are second rate creatures that aren't allowed to talk to anyone other then their harem leader.
If you can't defeat your enemy then crush their monetary flow.
The old saying was....beware of Greeks bearing gifts.

NEW YORK (MarketWatch) -- Shares of Washington Mutual Inc. fell more than 9% Friday after a report surfaced that the bank could be actively seeking infusions of capital from outside sources. The Wall Street Journal reported Friday that the nation's largest savings and loan has approached sovereign wealth funds and private equity firms as possible sources of emergency funding. Washington Mutual was also named in the article as one of the biggest banks seeking additional capital. The bank declined to comment. WaMu lost nearly $2 billion in the fourth quarter on mortgage-related writedowns.

Sure looks like the bear in materials and oil stocks has started. Those sectors were holding the market up.

closing shorts.

Right with you EEM...But only closing 3/4..Will keep the other 1/4 for fun

BG: So whats going to happen the rest of the hour and a half? Mor eselling into the close or a squeeze rally to scare the inveerse ETF holders?

Here is the Hail Mary of the decade.

1:29 PM Thornburg Mortgage to restate 2007 financials. Marketwatch

1:30 PM Thornburg restatement to recognize asset impairment losses. Marketwatch

1:31 PM Thornburg: Impairment losses won't hit shareholder equity. Marketwatch

1:48 PM Thornburg Mortgage said on Friday that it will restate results from 2007. The company has been getting margin calls from lenders and may need to sell mortgage assets to try to meet those demands. Because of these financing problems, the company said it will take a $427.8 million charge for the impairment of adjustable-rate mortgage assets that it held at the end of 2007. Most of the charge doesn't refect a deterioration in the credit quality of the underlying assets, Thornburg said. The charge won't have a material impact on the company's book value at the end of 2007 either, Thornburg added. Shares of the lender dropped 25% to $1.23 on Friday afternoon. Market Watch

I dunno, fellas, 1290 is a key level on the SPX and it's been breached decisively. We could head down another 70 points.

Of course, nothing moves in a straight line. And I have been killing myself setting stops too tight lately, so don't listen to me.

n2s-
I have the same problem of exiting trades too early in this market. However I feel it too risky to let the profits run in these conditions.
Covered some shorts yesterday, still holding the rest for now.

N2Son: I see your point..think FXP will be at $200 by summer? An ETF derivative split...lol

WASHINGTON (MarketWatch) -- Charging that the salaries and other financial perks of many corporate chieftains are exorbitant and not in the best interest of shareholders, lawmakers grilled past and present chief executives of three major U.S. financial firms Friday about the pay packages they received despite the implosion of the subprime mortgage market.

Angelo Mozilo, the CEO of Countrywide Financial Corp. (CFC), as well as former CEOs of Merrill Lynch & Co. (MER) and Citigroup Inc. (C), faced scrutiny of their compensation before the U.S. House Committee on Oversight and Government Reform.

"The pay they received from their companies and their stock sales was extraordinary," said Rep. Henry Waxman, D-Calif., the committee's chairman. "Any reasonable relation between their compensation and the interests of their shareholders appears to have broken down."

According to a report prepared by the committee's Democratic staff, Mozilo exercised options and sold almost $150 million of Countrywide stock from November 2006 through the end of 2007.

"Your timing was awfully good for yourself," but not for Countrywide stockholders, Waxman told Mozilo.

The report also said Stanley O'Neal, the former CEO of Merrill Lynch, was allowed to leave the firm with a $161 million retirement package, and Charles Prince, formerly CEO of Citigroup, was awarded a $10 million bonus plus $29.5 million in stock, options and annual perquisites when he left.

Prince and O'Neal both stepped down in 2007, as the subprime mortgage market was collapsing and their firms wrote off billions of dollars worth of subprime loans.

"This is a mess," said Rep. Elijah Cummings, D-Md. "I hope the [Securities and Exchange Commission] looks at this very carefully. Something doesn't smell right."

CEOs have their say

Mozilo said he did well as Calabasas, Calif.-based Countrywide, the mortgage lender that has agreed to be acquired by Bank of America Corp. (BAC), prospered. He said he's giving up about $36.4 million in severance payments and called reports that he was in line to receive as much as $115 million "grossly exaggerated."

O'Neal told lawmakers that compensation for Merrill's senior management was determined through a "rigorous and independent process" and was consistent with pay levels in the financial-services industry.

"My compensation and assets increased only when Merrill Lynch performed well for its shareholders and employees, and decreased when it did not," said O'Neal.

Similarly, Prince told the committee that Citigroup "has worked hard to align management's interests with the interests of shareholders."

But he took responsibility for the flawed risk models that the company and others used to assess some mortgage-backed securities. "In the interests of the company I had worked so hard to build, I immediately submitted my resignation," Prince said.

Richard Parsons, the former Time Warner Inc. (TWX) chairman and CEO who serves as a member of Citigroup's board of directors and as chairman of its compensation committee, told lawmakers that executive pay is set by independent directors and uses an independent outside consultant to review pay decisions.

The committee's top Republican questioned the usefulness of the hearing and said corporate boards and shareholders are addressing CEO pay issues.

"CEOs have resigned. Potential payouts have been surrendered or reduced, and so-called 'golden parachutes' trimmed," said Rep. Tom Davis, R-Va.

He also poured cold water on the need for lawmakers to get more involved in corporate pay issues. "We may not like it, but markets at times produce inequities. And they correct them. Government involvement in that process generally makes matters worse, not better," Davis said.

More than $20 billion lost

The committee's report said that the three companies lost more than $20 billion over the last two quarters of 2007 alone as a result of their investments in subprime and other risky mortgages.

"Yet Mr. Mozilo, Mr. O'Neal, and Mr. Prince continued to receive lucrative pay and retirement packages," the report said. Both O'Neal and Prince exited their posts late last fall.

The report said that the correlation between CEO pay and shareholder interests broke down in 2007. All three executives were well-rewarded despite steep declines in the performance and stock prices of their companies, it said.

Waxman isn't planning legislation about executive compensation, a committee spokeswoman said. However, there were calls at the hearing for redress to shareholders.

"The undue compensation awarded to these failed CEOs should be returned to shareholders," said Nell Minow of Corporate Library, a watchdog group.

EEM...

The problem with my numbers is my low is at 1270 on the s&P...

Correlates to the Jan low and I usually do not like that...Actually hate when that happens

The good thing is...I and everyone and their mother is looking for a retest of that number...So...Just says we bounce off that level for a short term trade IMO

I would guess a collapse to 1274 or lower into the close which then sets up the dilemma of whether to cover. If it does that then it will hit the bottom of the 60 minute downtrend channel on chart support and be very ovesold; seems like covering is prudent there, certainly for SMN which is up 9% today.

Falling apart and so much more possible. See daily.

NIHD a latin America wireless telecom play.

BG: You have a system..make money from it...again and again...times like this ..its better than sweaty sex with women I hardly know

craig (lunch)-> hey, things look good...now the question becomes does it carry thru on monday...if i had to guess->yes...a) capitulation has to happen sometime, and b) anyone who bought in the past month has gotten burned..so why would be rushing in to buy now? shoulda had a little faith before my meeting, but discipline over conviction left me high and dry and i'm stuck in cash with no reason to put it to work right now...

Its going to be an interesting final hour waiting to see how many of the shorts cover for the weekend.

Re: difficult price environment for precious metal explorers

To give you an idea of what Nova Gold is talking about with a difficult pricing environment for their cancelled financing, a company on my junior PM watchlist came into a $30m. windfall and their stock only rose about 5¢:

Yahoo.com news release from CBR.V:

Committee Bay Sells Coolgardie Gold Project for $30 Million

http://tinyurl.com/3xfyr9

Hm. Tough crowd, hey?

BH- are you still hovering, or taking profits?

Re CEO Compensation and the Uber Rich

Saw a story on TV yesterday regarding real estate in Aspen . Apparently, to expand your McMansion ski chalet, one has to buy expansion rights from another who is not using their space. $350k for the right to add on 2500/sq ft. They portrayed one gentleman from Texas who had bought two rights as he needed another 5000/sq ft. Apparently there is even an option trade developing for these rights.... greed continues
to flourish while Rome is catching on fire.

Are we going to have a LONG LIVE GS mad moment?

looks like the 3:15 buy machine started 15 min early

Argh, thar she bounces!

Just got out of SDS, FXP, DUG
looks like the dow just shot up~!

2nd,

I'll probably sit still. We have a lot further to drop in the coming weeks.

Trusty diebold trading machine and phantom shares.

TLT- surprisingly static...

we're having a pretty nasty snowstorm here in chilly Ohio and I got sent home on a very rare snow day...just like old schooldays! sweet.

Instead of sledding though, I've been watching the market (and you guys) here at home today. I don't know how you guys can stomach these wild swings on a daily basis. I'd be bald by now.

Daily summary at 3PM:

Working:

Apr40 put DBA +57%
Apr40 call DUG +23%
Mar 35 put CCJ +175%
Apr 35 call VIX +27%

Failing:

Mar43 put UNG - 33%
Mar15 call GFI -10%

More working than not today.

"I'd be bald by now."

That's not an issue if you already are. ;)

This is the long promised 3 of iii down, taking us below 9700 on the Dow. It will probably last until May.

bear trap->bull trap->bear trap...->?

2nd, all of the above.

spy popped its pivot...LONG LIVE GS..LONG LIVE PARIS HILTON

rotation into tech underway...CSCO/INTC/MU

looks like they're working the techs goog, aapl, msft, rimm all up in positive territory for the day... along w/csco which was positive already

EEM...

Paris Hilton...? you can do better...

BG: OK , Ill act my age...LONG LIVE HEATHER LOCKLEAR?

guessing EEMt's trading from his vegas hideout...

It's tempting to buy SDS or QID or another ultra into the close, but the charts look like they want to go higher. That bounce off the Jan lows will be trumpeted as reason to rally. Incredible, given that the fundamentals of the market and the economy get worse every day.

But there you are.

Any trade here is a gamble, imo. I'm going into the weekend mostly cash.

n2s- i'm going into the weekend ALL cash...

Someone trying to paint the weekend papers?

Anyone buying TMA for a weekend hold? :)

"Our portfolio of mortgage-backed securities has exhibited exceptional credit performance and comprises loans that are among the most solid in the industry. Quite simply, the panic that has gripped the mortgage financing market is irrational and has no basis in investment reality."

http://tinyurl.com/25ztan

Times are tough, but this one looks oversold right now... unless it hits zero of course.

Sell off in Agri space due to margin calls? I am not buying sector rotation into Tech.

Holding shorts through the weekend as insurance policy. They are hedging my longs so I really could care less if I open flat on a Monday morning bounce.

geckojb "margin calls"---looks like that to me

Story earlier today on FOX that producers of commodities are being denied lines of credit to hedge their positions. Discussed one trader having to buy wheat to unwind their leveraged hedges. Credit squeeze is entering the futures markets now and that out to deflate some of the wild speculation.

I was involved in high-end housing construction in Aspen... and, Oh the stories I could tell.

One of my favorites involves (can I use proper names on this blog?...Lets call her LW. This was the mid nineties, and LW was the Donald Trump of the time. I think, among other things, she controlled Reebok. Suffice it to say, she was/is very wealthy.

LW, like most high-end homeowners in Aspen, uses her house there about 2 weeks out of every year. The rest of time, the house is maintained empty by a caretaker who manages all necessary upkeep including landscaping, painting, repairs, etc.

These houses are generally very technical pieces of artwork, and those who build them are somewhat married to them as they are really the only ones qualified and knowledgeable enough to fix or change them in any way.

As usual, prior to an arrival, the caretakers calls the builder with a flurry of last minute requests... Everything from repaint the dining room, to please pick up deliver, unpack, and install Owner's new ski outfit in master bedroom closet.

So I, on builder's behalf, happened to be present the morning LW arrived for her ski vacation. The house was immaculate and fresh as she is a very demanding client.... Several grand in fresh cut flowers had just been strategically placed throughout the house (Kaimu would be drooling)when she arrives from the local airport with her entourage: chef, maid, etc. She walks into and through the house, accosts the caretaker telling her to throw all of these unacceptable arrangements out. She contacts her pilot and has him gas the leer jet up for a return trip to New York where he is instructed to pick up replacement flowers to be waiting at the airport from her florist. As pilot frantically files new flight plan and caretaker frantically makes arrangements with New York florist, LW changes into Aspen attire and heads out to slopes. But before exiting, she makes it clear she will be back Apres ski and expects new flowers to be installed accordingly upon her return. They were, but just, and at an unconscionable cost in time, energy, and effort.

I had some very nice flowers throughout my house that week, I can tell you... I drove the truck hauling out the trash that morning.

Fun times...

Thanks Aurator. Good info.

I suppose this means the talking heads will be pushing tech next week.

Ambac CEO Michael Callen just finished a CNBC interview where he talks about Buffet's tender offer to buy their Municipal bond market.

http://www.cnbc.com/id/15840232?video=652381882&play=1

How are technicians going to paint a sub 11900 close below the 50 DMA positively? There is no way. Asia sells off on the numbers and the employment situation.

Technically we now see 11200 - 10700.

2nd: Was the manic chimp again today. Short/long SRS all day for $3-400 a whack. Of course my JR's took a little pain but I eclipsed those on the SRS on one trade and bought small bites into weakness.

Added to SDS and QID when DJIA almost got to 11956, holding into next week. So far our fearless leader and CT are still calling this dance. Grab your partner....

Aside from Sharkies post where I lost all control (Shark, you should definitely be in comedy, THAT was fricking hilarious) and my yelling at my TV and Angelo the mobster and his GOP cronies, this was a really good day.

I hope everyone was hanging in there!
This is a weekend for relaxing and getting the kinks out of my shoulders. Kinda tense....LOL!

They had him on this morning as well, to follow up on the "deal" they got to add more capital. I wonder if this is just a re-hash.

"The cotton market is broken"

Cotton Comments
by Jurgens Bauer of RJO Futures
http://tinyurl.com/3bpdob

I fear that the cotton market is broken.

The cynic in me wants to say, "I've fallen and can't get up"-in regard to the current cotton market. And while that failed attempt at humor may seem crass, it also is a statement that contains an element of truth. The present cotton market doesn't seem to be able to serve the role that it dutifully has for almost 140 years now. Price discovery isn't supposed to be found off the screen or available only to those lucky enough to have secured a position in the option ring. And how about using the market to offset price risk associated with ownership of the underlying contract? Has it anything at all to do with the current cash market for cotton?

Until things settle down, I cannot legitimately and in good faith promote customers to transact business in cotton options when quotes are routinely 200 points wide. It has become a crap shoot, and the dice are in the hands of one high roller after another. In fact, the entire table is oozing with them-each eager for their turn to roll. All of the positions on the table are held by big speculative money. Trading this entire week has been so wild and wooly, that it's akin to what you read in novels about the Wild West back in the 1870s. It is gambling. I'd rather suggest that you wait until things cool, and prices trade on the screen. This transitional futures market (synthetics) means the price has disappeared from that screen.

Regular readers of my comments will know that I have been speaking of the issue of big fund investment in our market for more than a year now. The forces of fear and greed have taken over from risk transfer. And from what I understand, there's not much actual cotton business getting done. And that's a problem in my book. When a market has little (if any) reason to move about as violently as it has, moves simply in reaction to size and the current order flow, and doesn't seem to care whatsoever about fundamentals, then it's broken. From what I gather, it happened in wheat and now it's happened in cotton. What markets are next?

There is no fundamental reason for the price to be one day at $1.07, and two days later at $0.80. So, until things get sorted out and calmed down, the sideshow they used to call cotton is destined for a bunch of "whales" (I think that's a term for high rollers) and sharks. In fact, I thought I saw a couple of great whites swim by the ring today.

[snip]

Bank failure: http://www.fdic.gov/news/news/press/2008/pr08021.html

Small bank, but it's starting...

MtnGntx
are you sure LW wasn't running a bank , sounds like the smae care they take with shoreholder money. LOL

same care they take with shareholder money.
Can't spell and I haven't even poured myself a scotch yet.

Something isn't right. I was reading the report about the bank failure that moab posted. Then I read this following line:

"At the time of closing, Hume Bank had approximately $1.1 million in 33 deposit accounts that exceeded the federal deposit insurance limit. These customers will have immediate access to their insured deposits, and they will become creditors of the receivership for the amount of their uninsured funds."

$1,100,000/33=~$33,334 per person. Does this mean that there was about $33k for 33 people that was above the $100k limit? If so then ok. If not then how in the world if you only have about $33k in your account is that not insured.

Global Mortgage article. Not sure what to think about this article. If there is any truth to them going BK, and there are a supposed 100 branches involved, the FDIC is going to have to hire a few thousand good men to handle the customer insurance calls.

http://ml-implode.com/imploded/lender_GlobalMortgage,Inc._2008-03-065.html

Speaking of Scotch:

A 23 yr old financial analyst without the good sense to keep his mouth shut. Found via the 'Ville:

http://www.brightcove.tv/title.jsp?title=307736763

BTW, a few years ago four Goldman bankers celebrated bonus season with a dinner that ran into, as I recall, tens of thousands of dollars. It made the papers, with quotes from them, a photo of the tab, comments from the servers, etc.

They got fired.

This jackass ought to get canned as well.

Sometimes I think one mistimed fire at Cain on a hot night would wipe out half of the Street.

Denny,

The question is when will the music stop playing for gold.

No signs of that yet.

Enjoy your weekend.

Cheers!

Mikede,

Just did a bio search on her... she never ran banks, but it looks like she came from the same stock (pun intended).

http://tinyurl.com/2b94xt

Favorite quote of her bio... the last line.

"a career of genuine accomplishment undone by hubris"

Will probably apply to many more of her ilk in the near future.

It sounds like the $1.1 million is the sum of uninsured amounts.

I keep thinking of the Carlyle fund implosion. If they, the whitest of white shoes, are being denied credit, then we are potentially facing unprecedented deleveraging.

Thank you for recent Goldcorp report. Very interesting to read and much appreciated.

Does anyone know about credit card companies and how you could short them?

aucourant,
There's Mastercard, MA. Visa is not yet public. AFAIK both are only transaction entities, they don't have any financial relationship with the clients. If you're looking to short the next subprime, its back to the banks that issue the cards and have the loans on their books (if not securitized). So the big players would be Capital One or American Express (AXP) etc.

Kaimu, and others with historical perspective on gold.

http://www.youtube.com/watch?v=iRzr1QU6K1o

credit to themessthatgreenspanmade.com which found Nixon's speech on the decoupling of US$ from gold in 1971.

Don't worry, slick Richard says, it's just a "temporary measure" until a better new international currency regime is introduced ...

Thanks for the info, cyderman. I looked up Capital One. It has already fallen significantly in the last year. But this would not be an area where I would have much understanding or feel comfortable, I discovered.

Further question to readers of this blog: Does anyone use Resource Stock guide? I signed up for their free service, but I am considering signing up for a premium service. They have a sample newsletter that was predicting that Western Goldfields would triple when the price was recently at $2. For a relatively naive trader, such as myself, I found that letter very informative, and, in retrospect, prescient. I also like Boris Sobolev, who seems to be pretty solid. Any experience with this service, which covers uranium, gold, and silver?

MtnGntx - very interesting story. I have worked for one of her old (and more successful) competitors for many years and can attest that he is nothing like what she is ...or was as an employer. And clearly you saw the "hubris".

I found this quote to be very telling (article linked below) because I believe it's the truth when it comes to successful companies or the downfall of others.

"Klein and Schwartz credited Wachner for the success. But they worried that her management style, which led to high turnover, would damage both her business and theirs. In the suit, they characterize her variously as "abusive," "unprofessional," and "vulgar." The suit also asserts that Klein had trouble finding employees willing to work with Wachner. While Klein declined to cite specifics for this story, Wachner's style is well known. Customers say she berates staffers in front of them. Klein says he discussed the problems with Wachner. "Linda, you make them quit," he'd tell her. "You cannot treat people this way." Turnover never has fazed her, though. Division heads, an executive once heard her quip, "are like tissues from a box." (Wachner declined to comment on her management style.)

http://tinyurl.com/359g7f

The decoupling debate
Mar 6th 2008 | HONG KONG
From Economist.com

Could recession spread from America?

“DECOUPLING” is the source of a great deal of controversy. Economists argue about whether or not emerging economies will follow America into recession. The most pessimistic claim that as economies have become more intertwined through trade and finance, this should make business cycles more synchronised, not less. The slide in emerging stockmarkets on Wall Street’s coat-tails appears to endorse their view. Yet recent data suggest decoupling is no myth. Indeed, it may yet save the world economy.

Decoupling does not mean that an American recession will have no impact on developing countries. That would be daft. The point is that their GDP-growth rates will slow by much less than in previous American downturns. Most enjoyed strong growth during the fourth quarter of last year, and some speeded up, even as America’s economy ground to a virtual halt and its non-oil imports fell.

One reason is that while exports to America have stumbled, those to other emerging economies have surged (see chart 1). China’s growth in exports to America slowed to only 5% (in dollar terms) in the year to January, but exports to Brazil, India and Russia were up by more than 60%, and those to oil exporters by 45%. Half of China’s exports now go to other emerging economies. Likewise, South Korea's exports to the United States tumbled by 20% in the year to February, but its total exports rose by 20%, thanks to trade with other developing nations.

A second supporting factor is that in many emerging markets domestic consumption and investment quickened during 2007. Their consumer spending rose almost three times as fast as in the developed world. Investment seems to be holding up even better: according to HSBC real capital spending rose by a staggering 17% in emerging economies last year, compared with only 1.2% in rich economies.

Sceptics argue that much of this investment, especially in China, is in the export sector and so will collapse as sales to America weaken. But less than 15% of China’s investment is linked to exports. Over half is in infrastructure and property. It is not just China that is building power plants, roads and railways; a large chunk of the Gulf’s petrodollars are also being spent on gleaming skyscrapers and new airports. Mexico, Brazil and Russia have also launched big infrastructure projects that will take years to complete.

The four biggest emerging economies, which accounted for two-fifths of global GDP growth last year, are the least dependent on the United States: exports to America account for just 8% of China’s GDP, 4% of India’s, 3% of Brazil’s and 1% of Russia’s. Over 95% of China’s growth of 11.2% in the year to the fourth quarter came from domestic demand. China’s growth is widely expected to slow this year but to a still boisterous 9-10%.
American downturns have often caused the prices of oil and other raw materials to slump, but this time China’s surging demand is propping up prices and fuelling booms in Brazil, Russia and the Middle East. Brazil’s exports jumped by 26% in the year to February. In turn, if prices stay strong, so will China’s exports to commodity-producing countries. A sharp slowdown in China would hurt them more than an American recession will.

The popular argument that business cycles should become more synchronised in a globalised world rests on an out-dated impression that poor countries mainly export to rich ones. Instead, emerging economies’ trade with each other has risen faster and now accounts for over half of their total exports. Emerging markets as a group now export more to China than to the United States (see chart 2).

Some contend that this mainly reflects imports of intermediate goods into China for assembly; the finished goods are then exported to America and so will be hurt by slower growth. There is some truth to this, although Asian exports to China are increasingly driven by China’s own domestic demand.

Another reason why globalisation and decoupling can co-exist is that opening up economies has not only boosted poor countries’ trade, it has also spurred their productivity growth and hence domestic incomes and spending.

A severe recession in America could still have a nasty impact on the developing world if commodity prices collapsed and if it caused stockmarkets to fall more steeply, depressing global consumer and business confidence. A sharper fall in the dollar could also further squeeze emerging economies’ exports.

But for perhaps the first time ever, developing countries would be able to make full use of monetary and fiscal policy to cushion their economies. In the past, when they were net foreign borrowers, capital inflows tended to dry up during global downturns as foreign investors shunned risky assets. This forced governments to raise interest rates and tighten fiscal policy. Economies with large external deficits are still vulnerable, but most emerging economies now have a current-account surplus and large foreign reserves; many have a budget surplus or are close to balance, leaving ample room for a fiscal stimulus if necessary.

Perhaps the best support for decoupling comes from America itself. Fourth-quarter profits of big companies, such as Coca-Cola, IBM and DuPont, were better than expected as strong sales growth in emerging markets offset a sharp slowdown at home. Bits of American business are rising above their own economy. With luck, the world economy can rise above America’s.

ALOHA !!

I have been posting about farmland for years now. More to the point year-round food producing land off the "grid" like we have here in Hawaii. Today was an absolutely glorious day with sunny skies and a cool tradewind and 78F! Hard to beat this weather. Now as I type we are having a light rain! I mean you do not even have to water here most of the time its so perfect for farming! Capt. Cook called it "paradise on Earth"! It still is ...

Now on the other side of that equation is my roudy hot-tempered neighbor who is acting up again! PELE!!! She is flowing to the sea again and putting on quite a show!!! YOW!!! Truly one of the most awesome sights is watching the lava flow. Right now about a 30 foot wide hot molten river!! It makes you feel very small and insignificant when compared to the sheer power of Nature!!! I mean this is how land on planet Earth has been forming for a gazillion years now! My wife and I ride our Honda Ruckus scooters through the jungle trails finding the best vantage points for us lava junkies! We are in no danger since this flow is back in the same spot it was four years ago, imminating some 20 miles away.

Anyway here is the info on farmland ... This article nails it on the head in terms of what I have been seeing and continue to see and that is a return to "real wealth"! Food will always be REAL WEALTH ... SIVs and CDOs and all the garbage the US Banks and the US Treasury churn out are just that ... garbage! 100% risk and 0% value! The best returns will be made with the basics of REAL WEALTH, mainly food, energy, water and real money! Lets face it the Earth just has too many people and not enough resouces are being produced to keep up. Supply is short globally and four billion people want a better standard of living!

If you cashed out of US residential in 2004-2005 and then moved into farmland you have made a fortune! We cashed out of the Bay Area residential in 2003. A bit premature! If I recall Warren Buffet sold all his California property in 2005! HA!! Shoulda ... woulda ... coulda ... Warren-n-n-n!!!

The article mentions the Westchester Group in Chicago, IL for investors wishing to own a part of the farmland sector. I do not endorse the Westchester Group and I have not done any due diligence on them.

READ ON:
Investor Report: Booming Farmland Acreage

Fri, Mar 7, 2008

Prices may be sagging in housing, but they're booming in a segment of the real estate market that deserves a close look by investors: Prime farmland acreage, where global demand for biofuels and other agricultural commodities are driving up values to all-time highs.

Iowa farm acreage prices set a record last year -- it was the fifth straight record in a row -- hitting an average of $3,908 an acre. Some top-yielding corn-producing areas in the state are seeing prices as high as $6,000 an acre.

An expert on farmland acquisition and management, Murray Wise of the Westchester Group, Inc. of Champaign, Ill., says hefty annual gains in farmland values -- in the Midwest and elsewhere around the country -- are attracting what he calls "a tidal wave of investors" into the field.

Unlike the housing boom, farmland appreciation isn't being propelled by wacky financing or speculators looking to flip property. Nor is it solely based on the surging popularity of biofuels.

"This is not an ethanol bubble," Wise told a recent global land conference in Colorado. "There are several fundamentals that are showing that the next 10 years for agriculture will be extremely favorable."

A key force driving prices up is the fast-growing worldwide caloric demand for soy, wheat and corn -- to feed populations of developing countries.

For example, China used to be the world's third largest exporter of corn. Now, it's a net importer. China is importing 4 percent of America's entire annual pork production, and its demand for soybean oil -- a crop grown extensively in the U.S. - has more than doubled in recent years.

Wise, whose firm acquires, markets and manages farmland for investors, said good acreage has been returning an average of 11 percent a year -- that's better than a lot of stock and bond market alternatives.

But like all investments that sound enticing, farmland isn't a sure bet. If you haven't done your due diligence, you can lose a bunch of money.

Plus there's the perennial problem with real estate: With prices booming, could you be buying at the top of the cycle and pay too much? Absolutely!

If you do invest, you can put your money into a professionally-managed fund that specializes in farm ownership and management. Or you go out and buy a working farm yourself.

If you choose the latter, make sure you hook up with experienced professional advisors who can guide you step by step from acquisition to crop production and marketing.

Unless, of course, you're a farmer already … and you know all that good stuff. END

There is no question anymore.

We have never had two negative jobs reports in a row outside of a recession. Historically, this proves with 100% accuracy that we are in a recession.

While the stock market is down 15% from the highs, on average equities lose 30% in a recession.

This means we're only 1/2 way through average losses in the equity markets for a recession, and this recession is likely to be significantly worse than average.

This report will likely mean a negative GDP for the first quarter.

Quentusrex

reference "$1.1 mil in 33 accounts"

33 accounts had more than $100k. This could cover for example customer A who had $100,001 and another customer B who had $400k.

Total of 33 accounts which each had more than $100k in deposits. Total is $1.1 mil that is not insured. So in the aforementioned example, A is out $1; B is out $300k.

Jim re smarmy link--could you see him testifying before Congress? LOL.

Dapoopa: I hate to directly disagree, but since people's money and futures are on the line, and Caraistas are a team, I feel the need to reign in an errant teammate.

We don't trade stories or "luck", we trade reality. We trade the tape, charts, money flow.
We trade prices.

I suggest that everyone clinging to the decoupling story take a good look at Colin Twiggs daily trading log and in particular today's report. If we were the Center for Disease Control and we used charts to determine the spread of disease, we would be alarmed and sending/stockpiling medications, antibiotics and quarantining the afflicted.

ALL indices (except "Ironically" Tech) are down, and have already or are poised to break support, have long term falling money flow and negative divergences. That includes India, China, Japan, Australia, Great Britain, etc. Tech will get sick too.

The story of decoupling is not being told on the tape or on the charts. It's a nice story, but it isn't true at the present.

Jock,
Could you please forward me a copy of the Goldcorp report. TIA.

Craig: DaPoopa's post are excerpts from the economist,which he/she refers to, the full article is here.

http://www.economist.com/finance/displaystory.cfm?story_id=10809267

You are not ecouraging groupthink are you?

The charts you mentioned are at support, they could or could not break, or they could bounce.

I hope we can accomodate and encourage differing points of view, esepcially from new bloggers. all the more important since people's money are on the line as you put it.

I was thinking.....

A good group for short consideration may be the
restaurants.

High food costs.
High consumer debt.
High gas prices.
Economy in Recession/Depression.
Contracting job market.
Tight credit for business/homeowners.

Any thoughts?

Would look for companies that are already
stretched.

maggy,

Was thinking the same thing myself while out running around this morning. The restaurants looked to be nearly empty.

IMHO, you have a good short idea there.

Regards

I think there is so much buying and selling at the current levels that the market is prone to a butterfly wings effect. Some small event from some where could cause prices to collapse below the SP500 1100 line. I get that impression from looking at the 16 year time frame for the SP500. It seems reasonable that we could wind up trading between 800-1200 for another four years. However, my commitment to this scenario is worth a warm cup of spit. As soon as the SP 500 closes above 1400, I am buying:-)

EEM, No I am not encouraging group think.
I am encouraging looking at the tape and reality and not a story.

The "charts" themselves have broken support, but there is more to charts than the main body of the chart, which is history, tracks of our footsteps as Dr. Elder writes. We also use money flow, volume, moving averages, other indicators. The money flow indicates 'long-term' distribution and a breakdown of short term accumulation from the 12000-12800 bounce and back.... The moving averages indicate a downward trend. Do you trade against a moving average? If and when those indicators break the trendline to the upside, then they will have indicated a change of that distribution momentum. That THEN will be our story.

These long term indicators are like oil tankers, they have momentum of their own and are very difficult to stop or turn. We have to make that determination when we get there. So far money flow and the moving average is telling us a different story as is every other external (to the charts) economic indicator. Group think would disregard these measures, like Larry Kudlow.
Group think would disregard employment falling, inflation rising, dollar shrinking, rising oil and food prices. I do not suffer from group think.

As a matter of fact, the money flow on the Hang Seng has crossed that trendline ending the accumulation Shanghai Fly wrote us about a short time ago. THAT is reality. Not a story, which IS group think based on "luck" and "hope".
I'm not positive or negative, I'm a trader. I'll take what comes to me....in REALITY.
I'm sure as hell not going to buy a falling money flow or moving average. Those are to be shorted.
In view of the "fact" that these charts have yet to be wrong, and have determined exactly where we find ourselves presently, I intend to follow them to the letter until they say otherwise, confirmed by the plethora of economic indicators available to us.

Surely this will depend on a trader's timeline.
If you are very short term (day to day) then perhaps you trade a bounce off 11650-11800 or short the current trend, but the tanker, the money flow longterm/moving average trend is not broken and it will take considerable effort to stop that momentum. So the long term trend is still down until reality indicates otherwise.

I submit yesterday's further opening of the discount window and disasterous employment numbers as proof that the momentum is not even close to slowing. If the story were true, then would we see worldwide indices breaking?

In the face of reality, we then have a magazine/web story.

Does the story change that momentum? Does the story put money into the markets? Does the story increase liquidity or stave off insolvency?
Does the story employ people? Lower the costs of food or fuel?

I'm totally open to seeing any FACTUAL information to the contrary. Not a story, but actual proof. To the contrary, I don't want groupthink. If the fundamentals or technical analysis are down, does saying so make it group think? I don't think so.

Craig : the issue in the article was about decoupling...Economies DECOUPLING...Have you read that article?

Not how you read charts..glad elder's and livermore's book is helping you..

Whew...glad you are reading charts..dont remember your earlier posts about charts..ooo say before December...?

Decoupling: Craig and others, be careful you are not confusing "Financial" Decoupling with "Economic" Decoupling, there's a difference and sepearate.

The only thing that's been proven thus far is Emerging is still coupled to the USA by way of Financial Markets but still shows in the "charts" as Craig points out.

What is less certain and open for debate and discourse is whether these countries are still coupled economically. The story is less clear and some believe that within the next 6-15 months it will be shown that Emerging has in fact decoupled economically (this is the premise of the article), thus it will only be a matter of time before the the charts show it.

I am feel pretty good this economic decoupling will happen just not sure when.

I would like to see this discussion be kept open and debated.

*******WALL STREET LAYOFF ALERT********

They've screwed the pooch and now the chicken's coming home to roost. According to a confidential source deep inside, Lehman Brothers is planning to decimate it's workforce by firing a full 10 percent of it's workers asap, and is taking a chainsaw to it's wholly owned subsidary Neuberger Berman where it's planning to chop between 30 and 40 percent of it's workforce!

Remember, you heard it here first, on BILLCARA.COM

EEM, How did you think I was trading? With my gut? Nobody's gut is that good!
Before I ever discovered BillCara.com, I started with IBD and William O'Neill's "Making Money in the Stock Market", so used charts from the start. Certainly not the full compliment (which exxplains my results up to then) of TA until I came here in November of 2006 when Bill was using Colin Twiggs on a regular basis. I took Bill's advice immediately (regarding his RSI system) and have used CT and technical analysis on a multi-screen set-up with the full compliment of realtime charts since then.
I think I have posted/quoted Colin Twiggs more times than I can count since. That was well before December! More like since January of 07. :>)

I don't reject the decoupling story, I simply want it confirmed, which has really yet to happen. Is it domestic stasis in emerging markets or is it something else still tethered to U.S./developed market consumers? I still doubt emerging market stasis is anymore viable than it is in the U.S. What is happening in our developed market? Are we going to do well with the recession we are seeing? I'm open to hearing how a developing market losing it's primary customers will fare differently.

A good example might be an article I read last night on Minyanville on this very topic.
Decoupling may be happening, in process if you will, but the result *may* be from the exodus of American expatriots jumping from the U.S. sinking ship to places like Panama.
Thus a fleeing of U.S. capital and not true decoupling ala domestic consumption as of yet. We need to be careful as to what we think we see.

That will show up in the tracks....our charts.
It is still a story. I'm open to the story coming true and showing up where we can trade it, but it has to be on our charts before that can happen.

Has anyone come across decent historical information as to how far ahead markets lead the way up before the trough of a recession ? We know that markets typically preceed the peak of the econ cycle and b/c they are forward looking they tend to lead the way out ? anyone know of the average time in months that the market has picked up prior to the basement of a recession....? thanks, rk

BTW, just out of curiosity, I searched myself in the "Daily Commentary, which is what it was called before "Discourse", and the first post of mine I could find was June 07 back when Bill was sick. I'm so glad those days are over....I'm sure our host is ecstatic.

I remember reading for a long time before ever posting. The crystal ball had me in awe. I had so much to learn before I felt confident in my abilities enough to write, but I had that charting knowledge started from IBD and was always interested in TA.

My first post cites "support" for a junior gold miner that I was getting off a chart for another community member. Life is a journey.....

It's all so very confusing.

Re. decoupling, take a look at Brazil vs the Dow:

http://finance.yahoo.com/q/bc?t=1y&s=EWZ&l=on&z=m&q=l&c=dia

That chart looks impressive. Since the USD has depreciated that much vs. the $R, add another 40-50% on top of the EWZ!

Mind you, they are not immune, so I have been shorting EWZ and done quite well in the last 2 weeks. I am always looking at bubbles/overbought conditions to short.

-----

BCE shareholders, the bond holders was dismissed, BCE went up 9% after hours Friday. Should be a very profitable day on Monday. There is still risk, but cash in and eliminate the risk altogether.

Craig, I agree with your thought ,about Americans and their capital fleeing. Last weekend the newspaper reported G.E. Capital moving its headquarters to London. G.E. is broken into six subsidiaries each a separate corporation. Once a corporation moves off shore it dose not have to pay taxes on profits until they bring the capital back to the U.S. When ever G.E. decides that should be.As I under stand it. Bob.

LOL Bob! Would you bring it back and repatriate it or just leave it offshore if you were GE...or any other multinational corp? Or individual..:>)

Do you suppose those expatriots working for cash in places like Costa Rica or Panama pay U.S. income tax? I don't think they do anymore than they claim their Swiss accts.

Craig, Of course not..:>)

Glad that my post of that Economist article got some discussion going about economic and financial coupling/decoupling. Of course financial markets can and do get out of whack with the underlying fundamentals...but at some point - eventually - these same fundamentals will re-assert themselves. At which point we will see money flowing to those areas of the world most deserving of investment.

Here is some interesting data for EM investors on this board. EPFR Global fund flow data since December shows Russia way ahead of all emerging markets with an inflow of $1.06 bln. By comparison, all other major EM categories have seen significant outflows: Brazil $605 mln, India $747 mln, BRIC $1.4 bln, GEM $3.06 bln and the combined China + Greater China category a whopping $4.4 bln.

The problem for Russia is that the local market is still down more than 12% YTD...so this money is just sitting in fund managers' accounts and not being put to use. Or at least not yet. Apparently these managers are waiting for an even better buying opportunity...maybe when the market is down another 12-15% for an overall drop of 30%, as was the case in May-June '06. But when that moment arrives (I'm thinking 4Q08), Russia will absolutely be the place to be overweight in the EM space.

Are we headed for a Kondratieff winter?

(never heard of it...read about it here -> http://www.kwaves.com/kond_overview.htm)

Yesterday the dow broke a 26-year tendline folks!

The % of dow stocks above their 30 DMA dropped from 30 to 20.

I am of the opinion that despite being in oversold conditions we are now probably set for a major waterfall/plunge/crash.

My charts are pointing towards the dow going to 9,750.

I am a believer in the PPT, so if you are thinking of going major short, have pause to consider what the gov't might be capable of doing to prevent a catastrophe. I'm sure there are measures/scenarios that are engineered to minimize the impact.

A multi-week declining trend is most probable at this point.

If Transports (IYT) continue to decline, then a primary dow sell signal will be confirmed. If not, the further decline might abate and (unlikely) reverse creating a bull signal. Yesterday the trannies did not close at a new low but the dow did...

we shall see...

Targets for DJI & Gold

http://www.financialsense.com/fsu/editorials/2008/0307.html

onlineaces,8 Mar 5:11PM

This is another example of a semilog chart. Difficult to tell, but perhaps the data could be logistic implying carry capacity not yet reached. If that is so then the straight line appearance could represent the half of the S-curve before the inflection point. So many types of data can be made to fit a straight line when logs are used that I wonder if there is any value in this. Even Salem witchcraft trials fit this model.

A beautiful quote from Dan Norcini on Fridays "Jim Sinclair's Mineset" regarding black box algorithms:

System traders, such as these hedge funds, believe, wrongly, in my opinion, that their computerized systems produce better results than discretionary traders such as myself and a few others. Dinosaurs such as us have learned from experience that it is the person who understands the market they trade in and knows how to spot an untenable position on one side or the other, and knows how to press their advantage, who will ultimately come out on top of what is a zero sum game. After all, if you cannot call your opponent’s bluff why should they run especially if they know that your system will buckle and force you out if they can but put enough pressure on the market to kick the brainless machine into taking you out at exactly the moment in time when you should be increasingly adding on and making your enemy’s life miserable. Whoever blinks first in this war loses and those who have a machine blinking for them are doomed to lose every time until they learn to turn the thing off and THINK for themselves and then act accordingly.

When EWZ broke, I emailed my Friends and Family to go long EEV. I was long 3 weeks already. Obvious sceanrio. I say hold for several months, maybe into June. TBD. Long EEV and FXP in Roth IRA.

Managed to receive secret comm between Bernake and Paulson; first time revealed; Cara exclusive:

B: ...but I just cut the white striped red wire last week... I'm hesitant to cut more red wires as the timer went to 2x pace... P: Cut the red wire with brown stripes...; Snip! OK, R w/ B cut; What about the brown wire w/ orange?

P: leave that for next week.

B: I'm really wantin' to cut this green w/ blue stripes... P: Let's hear some more from Congress until you snip that.

B: Thanks; I think I'll snip the gray with yellow stripes before I cut anything more radical. That ought to satisfy the gray lobbyists without pissing off the yellow camp.

P: Ben, you better snip the brown with blue stripes, as we are down 300 pts on the Dow...

B: Done, and I will add $200B at the auction window.

P: Gerat job, B would be proud! Don'y worry about that Euro high...

B: Been rough, but I feel confident all is in order!

P: yes, we have deceived the public so they think we have control of everything, and they can sleep tight.

B: Thank's Hank, I am relieved and can sleep well.

P: Same to you Ben, ..., Great job! America is safe, liquid, and prosperous. Sleep well!
G will be pleased and we will all be re-appointed and draw our fat salaries until we die. What more could yiu ask for?

This is either:

The greatest transfer of wealth from the middle class, in general, to the wealthy, by the use of phony RE investments, an phony credit instruments; the two combined; or the greatest exposure of the most clueless management team, generally accepted by the majority of clueless investors, we have seen in our lifetimes.

Duh?

OR:... It Ain't your Grandpa's Oldsmobile.

Clueless investors screwed till June. Denial.

After that, we will take down the "ideologically impaired" investors, and emerge to a temp high, until thegrass browns.

Great delight here! Short and happy.
The more the morons, the better!

Aur

That was definitive!

Get out! if you haven't already been scolded!
Out of US denominated assets. What, been posted hundreds of times.

40 Oz of Gold will buy a $ today's $450K home by the time this subsides... and I need.
I have that! And I will kick arse in a couple years. Safe and sceure in a SD Box whialst you drive your Porsche Cayenne Tu. Laughing my arse off!!!

Denial is the savior of the enlightened. I'm so happy 95% of investors are clueless!!!

DB out

Hi All,

Some detail on this past week ~

Breadth for the overall market was about exactly the same as the week ending February 8th. So, we do not have a stronger downside pulse in breadth at this lower index price level compared to Feb 8th. This would suggest the Jan 22 & 23rd lows may hold the decline, at least for next week (which on a price basis still allows for quite a bit more downside, ouch).

This week only 7 sectors closed with stronger than 0% breadth out of the 273 I track! So it is a matter of the least weak and the most weak in comparing strength. You will notice some mildly strong buying in Software and a few other miscellaneous sectors. The least broad selling in Tobacco, Utilities, Semiconductors, Internet and Transportation sectors. The broadest selling was in Homebuilders, Pharmaceuticals, Health Care, Financials and Materials sectors among many others.

Good Trading All!
Ralph
http://successfulonlinetrading.com/blogs

Trend indicators are unambiguous. We are going down.

Be cute if you like.

In these kinds of times, IMHO, the Cara 100 is meaningless. You will be spanked with the best.

Cara 100 will work in secular trends, but is meaningless in secular reversals.

We are in such a reversal, and you are toast unless you really know what you are doing.

Good trading!

Aurator

I had to laugh today while reading the ticker on Bloomberg....

MBIA asking Fitch to simply stop rating them....

A little like breaking your speedometer so you won't get a ticket for speeding or little children hiding their eyes and thinking *you* can't see *them*.

It seems to be a fad at HB&B.
Denial isn't a river in Egypt. :>)

Saturday evening music selection: Horowitz in Moscow. Stuningly beautiful.....again and again.

It's been a wonderful day in the Great Northwest.
Staying light quite late. For those affected, don't forget to spring ahead.

It will be interesting to see if these predictions become true short term...

http://cotstimer.blogspot.com/2008/03/s-500-gold-setups-turn-down-but-new-rut.html

Music: I'm playing Yanni Live fron Mandalay Bay in LV. Love that performance!!! Highly recommended DVD. I need a good subwoofer!
Syetem is Definitive Technology and I love the capability so far!

You play Yanny in TX you risk being flogged! Suburban sound systen works fine here w/ Yanni! I keep an Alabama cd close in the console in case I get pulled over. ;))

Patterns for day, very s/t traders.

Excerpt from Barron's weekly Trader column by Kopin Tan:

"Through the first two months of 2008, the S&P 500 has fallen by an average 0.78% on Fridays, with the market retreating two-thirds of the time. In contrast, the sigh of relief is almost audible on Mondays, with stocks rallying 83% of the time to notch an average 0.68% gain.

In fact, a trader who shorts the market late Thursday, goes long at the end of Friday, and then takes profit after the Monday bounce would have returned 9.9% so far in 2008, Clipston notes."

No guarantee this pattern will continue.

re the music of the night, Ray LaMontange and then Robbie Robbertson & the Red Road. It was a beautiful day in the Great NW. Had the Grandkids to the beach and out for a hike. Good little troopers for 3 & 4 yo.
Bill thanks for this site.
Peace from the north Puget Sound
Gray

Back from my vacation and boy was it nice to be unplugged for a week and a half. It didn't even occur to me to go on a computer for the first week, then figured I should let my parents know we were ok :)

While there I got to sample some Bloomberg TV, and I gotta say I found it too frustrating to watch. I like that it has more price info on the ticker like commodities, futures, etc., but the news ticker seemed to repeat some headlines more frequently than others. Not to mention a lot of the headlines would state a 'fact' without a source (i.e. "GDP will be lower for next two quarters"), and usually lacked useful details like actual numbers.

But worst of all was the "Breaking News" popup. It covered the news ticker, and stayed up for well over 60 seconds despite being a 7 word sentence that could be read in 6 seconds. As if that wasn't bad enough, the same breaking news would popup over and over again, with only a 1 minute respite in between.

Lastly, sometimes when they were covering a story and put up a graph of some data sequence, they would do nothing to make it readable. My favorite was I think some employment numbers or something, and it was a bar chart with 5 bars above or below a centerline, but no bar was more than one or two pixels tall. Nice.

Sorry for the rant, but I just don't get how stuff like that gets aired. Glad to be back home to my BNN :)

Canadians don't know how lucky they are.

http://www.mises.org/multimedia/mp3/audiobooks/rothbard/money/5.mp3

My previous link....

by Murry N. Rothbard: This is a must listen, (The written version is also available on Mises) on the history of money and why money is best left to a free market.

Banks face "systemic margin call," $325 billion hit: JPM

http://www.reuters.com/article/ousiv/idUSN0832645120080308

Attached MSN article on "will we run out of food" covers the global food inflation story. Follows up on prior postings reference the seed, grain, food story that is now moving to the front page. In this declining market expect the listed equities will be thrown out with the bathwater.

http://tinyurl.com/2xyp2p

Hi,

From a TA standpoint, the equity broad market indices charts look very dangerous.

If nothing "surprising" is done, equities will be heading south big time.

That is why I believe that shorts positions at these levels are quite dangerous.

Traders in equity markets are in for a volatile week.

Enjoy the rest of the weekend.

Cheers!

i just found Don Coxe's conference call from last week and posted it up on my blog, its a macro perspective but i think one that makes me feel safer in my gold heavy portfolio at the moment.

http://jglobal.blogspot.com

It's front page today NYT (most emailed at this time) more global food price concerns.

http://tinyurl.com/2tujlz

Ken Heebner - someone to listen to....

http://www.kiplinger.com/columns/fundwatch/archive/2007/fundwatch0228.htm

Maromatics:
I'm confused. If the market is destined to "head south big time", then why are shorts positions dangerous? Seems counter-intuitive.

I always look forward to your analysis, but don't follow the reasoning here. Thanks.

Back from Barcelona, with a bushel of charts and thoughts (Not always right, but never in doubt?)

http://ronsen.blogspot.com/2008/03/sunday-morning-brunch-setups.html

for those trading Asia-related:

By V. Phani Kumar, MarketWatch
Last update: 4:58 a.m. EST March 7, 2008Print E-mail RSS Disable Live Quotes
HONG KONG (MarketWatch)

Hong Kong's Hang Seng Index shed 3.6% to 22,501.33 and the Hang Seng China Enterprises Index sank 3.5% to 12,606.83.
"Things seem to be getting worse because there is no buying. The (trend of declines) will go on until the end of this quarter and we don't expect any rebound until April," said Francis Lun, general manager at Fulbright Securities in Hong Kong.
Lun said the Hang Seng could fall as low as 22,000 in the next few days.

Elsewhere in the region, Australia's S&P/ASX 200 index sank 3.2% to 5,264 and South Korea's Kospi lost 2% at 1,663.97, Taiwan's Weighted index gave up 1.5% at 8,531.38 and New Zealand's NZX 50 index dropped 1.3% to 3,558.26.
On mainland China, the Shanghai Composite finished 1.4% lower at 4,300.52, on concerns of further monetary tightening by the central bank to control inflation.
In a note to clients, ABN Amro analyst Irene Cheung wrote that an increase of "at least 50 basis points and up to 100 basis points" in banks' reserve requirement was "imminent" in the wake of recent comments by Chinese Premier Wen Jaibao and central bank Governor Zhou Xiaochuan on rising inflation and excess liquidity.
Cheung added that the "decimation" of the U.S. dollar overnight and expectations of aggressive interest rate cuts by the U.S. Federal Reserve will provide "further momentum" to Asian currencies, many of which hit multiyear highs against the greenback recently.

Dave

FBI turning it's attention from serial killers to weapons of wealth destruction:

http://tinyurl.com/yvwfsc

Ronbon: Maro can speak for himself, but we are at key support or below, not usually the best place to take new short positions. I'm sure he is warning that reversals could trap shorts, and judging by previous occurences, some manipulation to generate a short squeeze.

That would be IF they can generate enough buying to get it going. We could go either way short term, but longterm trends appear to be down.

I still have some short positons but I'm prepared to take my gains if we get a reversal and reenter later when the squeeze and any manipulated bounce abates. From the looks of Asia I doubt we see it but I've been caught before...

craig- i would agree that the landscape has again changed and that the downside is in play->play might be the operative word here- as you point out, getting the ball down to those targets could be a wild game...if a bull market feels like climbing a switchback, then a bear market (complicated by the psychology of ingrained buy-and-holders and the interests of fund managers only able to offer long positions) might feel like a struggle at mid-field (which we may have already experienced) followed by some spectacular moves on both sides before the final set-up?

Re FDIC-

how long has the 100,000 limit been in effect? If inflation + the decline in the USD has eroded the value of bank deposits, should there not be a corresponding increase in the limit, perhaps to 150,000?

sharkie- thank you for the heads-up on lehman...

craig-/sharkie (and anyone else with fond memories of the seventies):

The recession is here (can there be any doubt), and if the market discounts the future-> starting to hint it may last longer than a few months. While no one welcomes a recession, I think we would all agree we need one. To work off the excesses of the last decade, it may take a repeat of the seventies. For those of us who lived through the seventies, not all bad, right->kinda miss the long-hair-flannel shirt-faded jeans-driving a Beetle-laid back-majoring in psychology/social work/medicine mentality...

I think the recession ends when the 2014/15 version of the VW Rabbit (or Chinese or Indian equivalent) replaces SUVs and luxury sedans as the ‘signature’ car in America, when long hair and beards replace today’s buzz cuts and precision-trimmed facial hair, when the best and brightest gravitate back to the arts and (biological/physical) sciences (replacing business and 'technology'), and when blues and ballads replace the crap (sorry, I meant rap) that passes for music today...the beat goes on (and the next sonny and cher may well emerge from the underground shanghai or mumbai entertainment scene)...

Trading the ranges may be the way to go until then…when they start using the stock quote pages to wrap meat again and CNBC goes the way of the Sweathogs (looking forward to late evening reruns of Mad Money to replace the Fonz), we can return to buy-and-hold...

can't wait ;)

Craig and 2nd:
Thanks; good explanation. I'm currently short with QID and plan to stay there for the duration, perhaps trading smaller amounts in and out. CT also makes a good case for the Russell 2000 from a short perspective.

war on terror (if we assume the chinese are accurately conveying information) taking a wrong turn...awakening a sleeping giant...

http://tinyurl.com/2pa3ey

Uh-oh...it's already starting 2nd....

My wife talked me into growing the dirt squirrel back....a lot greyer that it used to be. When does Lavern and Shirley come on?

I didn't list Friday's musical selection...Crosby, Stills, Nash and Young; "American Dream". From the title song, "How could something so good go bad so fast?"

Am I reverting/devolving? Will we get DEVO again? A sign of the times?

We already discussed the cost benefits/return on investing in a smaller, more fuel efficient car. A beetle would work...

I don't know about the jeans...my 70's jeans were layer upon layer of patches of upholstery material until patching patches forced replacement, or I turned them into "cut-offs".

This time the curve feels steeper than the 70's....but I had less to lose back then.

i sold a yellow '73 beetle for scrap in the eighties, still have a couple of faded flannel shirts and a pair of redwings in the closet...

LOL! I saw that this morning and thought..."Boy, THAT is a BIG mistake."

WE have that Constitution thing...China has no such issue. This wouldn't be your GW war on terror...this would be terrorists BEING terrorized.

You may be right...Instant Karma is back, right between the eyes.

music's never really left in a way...driving on powell street the other day heard the vaguely familiar sounds of pink floyd coming from a bearded guy in his fifties with an acoustic six-string- he was really into it, cackling with laughter after belting out 'dark side of the moon'...maybe the names have changed, but this is basically the same kid i stopped to listen to in 1973 playing 'drift away' on the steps of union square...

I HAVE a 73 beetle in my barn.....in "marina blau" parked beside a four door 1940 Ford coupe. Maybe I should finally take on that VW project. Still lots of parts in Mexico.

the beetle always handled the snow well, with the weight of the engine in the front...but those heater boxes...unless you had 10 minutes to warm up the car before in the morning, you could be driving with with one hand on the wheel and the other still scraping ice off the windshield LOL...

'before leaving'

You guys are taking me back to my 1967 MGB...British Racing Green, with tonneau cover, knock-off wheel hubs, etc.
Talk about needing time to heat up; if you didn't put a double thickness of cardboard behind the grille, you'd freeze all winter.

Ah, the "Good Ole Days"! Went 117 mph in that car once....with the top down!

Craig,

Thanks, that is exactly what I meant.

:-)

Ronbon,

Indeed, I was trying to say what was better said by Craig.

May I add: I would not discard the possibility that some so called "surprise" (which could be some news spin or some intervention, or even a surprise rate cut) can be coming in early in the trading week, in order to ease the selling pressure and create an apparent rally, in which HB&B & friends & family could sell into strength.

That is why, short term, I imgine that traders believe that there may be danger in holding short positions, especially if these are on margin or in any way leveraged.

Of course that in wider timeframes (mid-term) this is an equities bear market, and therefore short positions may be advisable as part of an investment strategy, especially if you are using them as hedge and not so much as speculation.

In my trading decisions I try to keep in mind that:

- Short positions are inherently more dangerous than long positions, even in bear markets. This is due to the fact that from a theoretical standpoint, losses in long non-leveraged positions can never exceed 100% (and never get to that level because there is allways some stink bid), whereas short positions can, in theory, originate unlimited losses.

- ETFs are the kind of investment vehicle that may be particularly subject to counterpart risk. Please refer to the many comments by Kaimu about this subject and do your dilligence by reading and fully understanding the prospectus on QID or any other ETF.

Have you ever considered that instead of holding broad market ETFs like, say, QID, you can significantly lower your Value at Risk by investing only a small part of your portfolio in options with the same outcome? You can then use the remaining of your capital more defensively, by not having it exposed to counterpart risk.

Everybody here knows that I am out of equities for quite a whle, and am limiting my trading in equities to the trade of options over the broad indices, with no more than 10% of my portfolio, and always with a short term trading perspective.

Nobody here will challenge that bull markets are easier to trade than bear markets, and today, yes TODAY, there are several bulls going on.

So why focus so much on equities, when you have a wonderful bull developping for instance in the Precious metals?

Remember that you are not a pension fund, and therefore you are free to choose which asset classes you wish to invest your money at. It is only HB&B and financial entertainment media that constantly draws your attention to equities because thet have a lot of them to sell...

So think about it:

- Equities are in a bear market. It will end when it ends, not before.

There is no use trying to pick a bottom there, so there is no real longer term investment to be made here now.

That will come, in due course. Of course you can allways make money in shorting equities, but that requires a certain mental framework, some TA knowledge, available time to follow the market intraday, and a very nimble attitude.

- Bonds: at this stage of the cycle the bond market bull is already quite extended. Some scheptics will comment that it is the fed who wishes to decrease bond rates.

I do not know. All I know is that at some stage bond rates will stop falling as the credit market vigilantes realise that the current rates on bonds are "de facto" negative rates when compared with inflation.

When that happens, it will be time to short bonds as a long term investment strategy.

- PMs in general: hudge blowoff recently in Platinum and Palladium, mostly due to massive short covering by commercial shorts. Dangerous now for new entrants. It may rise, but its dangerous anyway,

- Silver and Gold: the first stage of a massive bull (accumulation) is now coming to its end, and wll be followed by the second stage: growth. great market to trade the long side as an investor with larger timeframes. Of course there will be corrections, but bull markets allways correct. Traders use those periods to accumulate more.

- Food commodities: grand bull underway, not even close to ending, but these are very volatile markets to trade.

- Oil: too manipulated for my taste.

:-)

Cheers mate!

117 mph with the top down? hired on the spot! LOL

ALOHA !!

In the face of skyrocketing food prices watch for the various governments around the World, especially the US government(and it does not matter if 2008 goes to Dems or Reps)to install price control measures. If that is done then we face even more shortages later depending on how long price controls last. The best soultion is for the US Congress to eliminate subsidies for farmers to keep their fields empty. If ever there was a more long standing and outlandish example of government stupidty and selective welfare then that is it! Its time all of America got off its ass and became productive ... DO YOU HEAR ME U.S. GOVERNMENT? As I type this many foreign producers and exporters of grains have stopped exports in order to feed their own! Don't let these idiots in Washington DC blame it all on shortages. Even without shortages prices would be rising due to "monetary inflation"! You cannot blame it all on specualtors who play the futures. If this gets too crazy worldwide look to see governments regulate and manipulate futures markets in an attempt to thwart froth from "hot money" hedge funds! Hummmmmm??? Just who do we blame for these multi-trillions of dollars of "wealth" NOT ... "DEBT" sloshing around the World looking for a high yield return? Who prints all this "hot money" anyway?

I can't wait to get my hands on my $300USD welfare "stimulus package"! HA!! Why did the US Congress limit it to only $300USD? Why not $30,000USD each? Its all still just a mouse click!! Who cares at this point? NOW THAT WOULD STIMULATE ME!!!

FYI
The Zimbabwe $10mil note, which only buys a loaf of bread, now has an "expiration date" printed on it! I would be interested in seeing statistics on Zimbabwe census. Surely there must be a flood of Zimbabweans leaving their country as "economic refugees"! Wouldn't it be ironic if this border wall now being constructed to keep the terrorists out was really a hidden agenda to keep US citizens in! HA!!! If that came to pass then the "Minutemen" would be strung up MUY PRONTO!! The Bush FY2009 budget has increased the number of Border Patrol agents and those airport TA agents substantially. That "fear" thing works really well against the masses!! Beware of Congress bearing gifts!

Sinclair has been talking things up about a Weimar Republic scenario with the US Dollar. If it gets bad enough do not discount that theory, because if you look at a chart of US money supply you would see that the FED has chosen printing over not printing 98% of the time over the last eighty years! Just the sheer fact that prices for everything and wages have been going up ever since I was a kid is proof of that! Also do not be shocked to see either a new US currency like an AMERO or a secondary currency for our foreign friends holding US debt. Think of it as kind of a "Preferred A or B" certificate over the Common Class C shares JoeSix Pack will be stuck with! What would CNBC do with that one?

kaimu, that last post included the fact that the Zimbabwe $10mil note now has an 'expiration date' on it. That is so scary. Forced spending!
I remember watching something or hearing...alex jones maybe, they were talking about the amero (which I think is inevitable, given the Montebello meetings and such)., also I think it was he who was talking about a whole new international currency system that is in the works, which was based upon credits that people must use within a certain time period. one world, one government, one military, one currency. rfid'd. yikes!
i'm sure we are a ways off yet, but in such uncertain times it doesn't seem too far fetched.
can't wait to read the micro mining pdf.

ALOHA !!

INFLATION ALERT! Postal rates rising ...

Unwittingly the US POST OFFICE has created their own version of a stamp futures market. Now we can "invest" in stamp inflation by hedging future rate hikes by hording the "forever stamps"!! HA!! What are the chances that the US POST OFFICE just eventually either ends issuance of the forever stamp completely or sets a price lower than what it was purchased for? We even have to gamble with stamps ... Such is life in FIAT WORLD!

READ ON:
Forever stamps lock in today's prices
By SHARON HARVEY ROSENBERG

The cost of a first-class stamp will increase to 42 cents on May 12. But between now and May 11, it's possible to lock in lower rates by purchasing ''Forever stamps.'' Introduced in April 2007, Forever stamps are valid first-class stamps regardless of future price increases.

Forever stamps purchased in April 2008 for 41 cents can be used to mail a first-class letter without additional postage even after the new rate kicks in.

''In this case, forever means forever. There is no fine print,'' says David Partenheimer, a spokesman for the U.S Postal service. ``The Forever stamp is a big hit for us.''

The Post Office already has sold five billion Forever stamps and plans to issue another five billion to fill demand. They are sold at the Post Office, over the Internet (www.usps.com) and by phone (1-800-stamp24).

Some financial speculators spot a long-term investment ploy that involves purchasing and hoarding large quantities of Forever stamps and watching the value of those stamps appreciate as a result of future rate hikes.

As an investment, however, Forever stamps may not yield a practical return, according to www.PennySaved.com. Storing and cashing out on large quantities of stamps may not be realistic. Other investments -- stocks, bonds and money market accounts -- offer potentially higher rates of return.

The stamps definitely have an ''economic value,'' but convenience is the main selling point, Partenheimer said, adding that Forever stamps eliminate the need to scramble for additional penny stamps when postal rates increase.END

Hi,

A few days ago, Marc Faber gave a very good interview on Bloomberg.

Coincidently or not, the video at Bloomberg.com does not have any sound.

However, I have made some research and you can watch it here.

I strongly recommend you see this.

http://tinyurl.com/22s4zy

Cheers!

Is Pennysaved.com is run by a bunch of tools?

1. Name the last time postage went down.
2. Stocks, bonds and MM accts offer better returns? Stocks (long) have lost how much? Bonds offer negative returns compared to inflation minus taxes, MM accts, less than inflation minus taxes...apparently Pennysaved doesn't know a penny is only .72 of ONE CENT AND there is no tax on stamps used.

I don't think a person can get rich buying forever stamps except on a pretty large scale. It's more like saving money against inflation by buying consumer staples with today's dollar, which is a good idea. I also don't think they will go on sale with inflation running rampant.

Even when inflation is relatively weak, postage climbs higher and higher. The weak point to me is the decreased use of stamps, BUT if inflation keeps going could also work *for* the value as rates are set on postal volume, which is why we can;t seem to get rid of junk mail. With retail suffering, junk mail will decrease along with advertising which will drive USPS margins down while costs (labor, energy) skyrocket. Sooner or later they will raise beyond 0.42 while the USD that bought those forever stamps shrinks.

It's like buying little peices of sticky silver.
Not a huge return but they last.....increasing that value over time. How long before a letter is 0.50 and a forever stamp is returning 18% plus inflation? Pennysaved probably would have said the same about gold when it was $300.

Hi,

Some pieces of an article I found on Wikipedia:

In economics, fiat currency or fiat money is money that has value primarily because a government demands it in payment of taxes, and that government has credible enforcement of it

The unifying feature of all fiat money is that whatever form or origin, the market demand for it is dominated by the taxing government's demand for it in payment of taxes.

(...)

Fiat money is typically backed by the good faith of the government maintaining or backing the money supply, importantly faith that it will accept the fiat currency in payment of taxes.

Under a fiat money system, money ceases to be a commodity like others, and begins to have special and peculiar properties. Instead of focusing on production, investment and consumption, economic actors begin to attempt to divine the actions of government.

(my remark: does this sound familiar with all the FED buzz?)

(...)

since a government that has control over its territory can requisition, confiscate or otherwise ban the use of specie within its boundaries, or suspend promise payments (...) the presence of fiat manipulation of money is seen as being a signal that a government is intent on abrogating property rights for other purposes.

(...)

The question of confidence dominates credit-based money, the confidence that a particular central bank or government will not act in a manner contrary to its national interest by allowing the money supply to rise or fall too much. Part of the system of confidence includes holding of reserves to be able to support a currency if attacked, and the issuing of debt to regulate the supply of currency

full article @ http://en.wikipedia.org/wiki/Fiat_currency

My question:

How long will it take before Joe 6 Pack loses confidence that the FED holds enough reserves to support the current speed of printing US dollars?

Cheers!

"The equity market in 1987 and the credit market of 1998 were scary but lasted a few weeks at most and the Fed waved its magic wand and all was well. The difference is that this is truly the end of the secular expansion in the credit cycle and the extent of the bad paper that was issued in the past five years is catching even the biggest "bears (realists)"."

(Marc Faber in his latest Market Commentary)

About time !

http://www.msnbc.msn.com/id/23547346/

Re. the discussion on stamps. The rate going from .41 to .42 is a 2.4% increase. You can get a higher return on treasuries if rather than buying stamps you invest your money.

Buying 41C denominated stamps is dumb and good for the post office, who gets to invest the money paid at much higher rates of return. Buying 'Forever-denominated' stamp is a little less dumb, not so good for the post office, not no so good for the consumer either, but it is however a convenience. This has existed in many countries, in Canada for several years now, in Brazil for many years.

From a financial point of view there are much better things you can invest in.

Seamus

I requested to be out on Monday from 12.30 to 3.00p.m
But on Monday few people were out and I have to cover some area.
I wish I had way to contact to you about me not being there

2nd

Market going higher for around 200 point before it goes down to 11500
Interest rate going down and with high inflation money in CD, Money market etc will lose
It value
Money in stock market will also generate lose

Money in gold, commodity etc will not lose it value but it is ease to get into this but
Will be hard to get out when every one else wants to get out, when dollar start to rise
And it will happen in futher

This s not my view, I do not have a view; this is general discussion they had.

2nd, Craig, VW memories?

Had three of them over the years . . '68 Beetle was super at grabbing inner city tight parking spots and had a great turning radius for those quickie U turns . . . picked up a used Karhman Ghia with a flat black paint job from God know's where . . . liven it up by placing bright yellow Hopi Indian decals on both sides . . and it could move! Finally, loved the used VW camper van with folding mattress and cold box storage in the rear . . .then one day caught on fire while driving in rush hour in Detroit . . . but we're hear today from the young and foolish days to laugh and smile with the memories!

And I do remember those cold days driving, yes, with the side door window open and one arm outside scraping the windshield . . Thanks for bringing the memories back guys.

P.S. Also, was able to sell all of them when their time came.

last post typo correction
"hear" today should be "here" today.

vinod OK. If/when next time, call the restaurant and have me (or your party) paged.

Bill,

Great WIR. Familiar concepts repeated over and over until we finally grasp them and put them to use. Like GG. Thank you.

vinod- thanks

The beat goes on .... subprime, auto loans, credit card loans and next derivatives ( WMD's) as Faber suggests.

'Exotics' fears after Lehman action - FT (03/08/2008 09:07 AM)

nice overview of weak dollar/foreign currency plays, lists a few inverse dollar funds, foreign currency ETF, and Everbank:

http://tinyurl.com/2vr4vo

Ah yes the old days,

Remember them well, scraping the windshield, VW gas heaters always had a lag, I remember driving with scraper in one hand, other hand on the shifter and knees on the wheel.

Also remember my first brand new car off the lot, 1973 Ford Pinto, paid $1790 delivery taxes all in. Drove it for 10 years (without a rear end collision) then bought a Honda Accord.

Now on my second Suzuki 4WD, first one went 17 years then sold it for $1000 still ran great, current one is a little more comfortable and still built on a frame. Body can rust out and I can still drive the frame around, can't say that for the unibodies of today.

And yes I enjoy the old radio stations that still play the oldies, not crap, I mean rap of today.

Nice to read some weekend rememberings, just came in from 5 hours of snow blowing, 2 gallons of gas and lots of work. Global warning my ass, this is a pain here in Southern Ontario, Canada.

craig- common sense can take you a long way in trading...i don't anticipate conditions becoming any more 'difficult' than they have been...

basic principles remain the same, right- buy weakness/sell strength (ie, no point in chasing prices in either direction as they will always [eventually] come to you)...buy despair/sell hope->moods change...nothing moves in a straight line...trade with or against the crowd, whatever works for you...

the only change i plan to make is to decrease the number of times i hold positions overnight (and/or lower the amount at risk), as i believe a) the risk of unexpected news has just markedly increased, and b) the reaction to any news will be exaggerated...

Nikkei at 12,594.32 at 615p PST, just 22 points away from the january 22 low...

http://tinyurl.com/yrm3b

2nd: Funny, I just read and re-read the WIR (without the benefit of commodities and PM's) but the gold warning in the opening was sticking me in the ribs and I am wondering what Bill is thinking. Does he think we sell off here as support for gold is $966 (current spot price $971 on Bloomberg). So naturally I wonder if I should perhaps take partial profits on physical gold. I'll have to wait for the PM and gold portion of the WIR and take a good hard look at the charts in the meantime. Unless the fed doesn't cut or cuts less than expected I don't see how the USD strengthens much so I would then think any weakness in gold would have to be from a general market downturn which depresses everything. Maybe I should hold and simply short gold/GDX or use the various instruments mentioned here lately to hedge.

Bill, when you get here can you respond? I don't expect to get rich with gold but it is a 20% allocation and lightening up exposure would be prudent if conditions are changing to the negative....even temporarily. I don't want to incur the Wrath of Kaimu either (I know he's right about physical), but this is the one advantage of the ETF's and miner shares. Easier entries and exits and lower fees.

As far as trading my equity accts I'm fine playing it as it comes, as usual. Not as easy to trade against the market except to the upside (shorting bounces) where I would be shorting near what are now resistance levels. Buying dips now has higher level of risk as you chance it not coming back to you in an overall negative environment where down moves can be more severe.

So position size will be key as will staying glued to charts.

food for thought: "Aging Boomers could burst housing bubble"

http://tinyurl.com/yuyhqc

"As the elderly become more numerous than the young, and as they shift into seller mode, the researchers postulate, the market shift could come quickly after 2010, causing housing prices to fall.

"Myers' and Ryu's foreboding prophecies bring to mind a 1989 study by a pair of Harvard economists, who predicted a 47 percent decline in housing prices during the 1990s because Boomers would stop buying as they aged. Housing-industry economists lambasted that forecast as pure poppycock, and it eventually blew up in smoke.

"Indeed, one economist recently called their projection "one of the worst forecasts in the history of mankind."

"But Myers and Ryu maintain that Gregory Mankiw, who eventually became chairman of President Bush's Council of Economic Advisers from 2003 to 2005, and David Weil, now working in the economics department at Brown University, were simply two decades ahead of their time."

Monday

EWM..going to take a bath..election results as mentioned in one of my earlier posts.

$DJI XBD XLF weekly charts..RSI bullish divergence?

QQQQs spinning top on higher than ave volume on the dailies, @support..which for the last 6 weeks anyway..high volume days has been closer to S/T bottoms than tops

EEM FXI EWZ gravestone Doji @ key price levels, surprised by EEM's vol given fridays bad news.

CAF/FXI hanging by its fingernails..

SKF kissed 3 std bollinger band, C<O, on very high volume on dailies.

Leaning to a trend day for monday rather than consolidation...

Triggers Fri Lows. Gaps and OR wil be eye opening on Monday

I thought of that a few years ago myself. When boomers want to liquidate to go into assisted living it could be a lot of supply into less demand. I don't think I will be selling unless it's to go move out of the country to a nice tropical locale.
Unless boomers buy rentals for income, but even then you need demand to make prices rise and to find renters.

Is the population shrinking? Maybe we should switch to emerging market RE instead where populations and standards of living are rising faster. Domestically maybe Utah and the southwest? Increasing populations with Catholics and Mormons trying to outproduce one another...:>)

Keep em' coming 2nd, you are reading my mind tonight. I read the WIR and came back to bounce off of you only to find your last post....with exactly my concerns and how you were thinking about it.

craig- my take on bill's gold comment is that there is no static strategy that works (everything ebbs and flows)- he may simply be saying that he would not be a buyer of gold at these levels (or a seller of the USD)...

in fact, to be honest, while reading the falling dollar plays i posted above (which should work out long-term), the first thought that occurred to me was that (in the short term), i should be thinking of rising dollar plays, such as RDPSX...

just wondering what someone who stumbled onto EEMt's last post out of context might make of it...

assisted living? not for me, at least not in the states...if i were faced with that prospect, would think about moving to singapore...maybe faber's thinking the same thing LOL...

Gold/GLD: Alright TA fans, put up a 5 day/5 min chart for the GLD. Can you see that symetrical triangle forming over ? Notice all the times it bounces off the rising trendline into the point of the triangle? The bottom of the triangle/trendline starts at the March 4th low of $94.39 at 14:15 and runs right to the current price point of 96.05.

MACD histo is dead even, RSI is 49-50 depending on your timeline and smoothing. The 50DMA is pointing down....

Any thoughts from the community are always helpful. This of course may be resolved by the time I wake up tomorrow.

I do notice the USD is weaker still now than it was this afternoon according to the Bloomberg ticker.

Thank You Bill. Your view hasn't changed then, so I'm good with that. Get some sleep and please wish your lovely wife a Happy Birthday for all of us.
I hope she has a great trip.

Now we just have to get you throttled back to more regular hours.....how about some Island Time 'Mon?

has anyone looked at the ETFs UDN and UUP (POWERSHARES DB US DOLLAR INDEX-bull and bear) funds as having any use in the present market.

2nd : They will look at my posts and think I spend a lot of time gazing fondly at gaps, double tops and bottoms, just so that someday a dragon fly can land on my gravestone to wish me well.:)

RE:GOLD

Joe six pack, with $500K to invest... is not going to go buy 500 ozs of gold at $1000 as part of his/her long term portfolio, you think?

Its because of competing yields, liquidity and investment choices, other precious metals, and other natural resource products that have a large and growing consumer demand for the basic necessisties of food , shelter, clothing.

You cant eat gold, build a house of gold ( not joe six pack), send your kids to college with it.

its a worthy storehouse of value ( against financial dislocation, hyperinflation), but not a medium of exchange. Its a leg as part of your investment portfolio.

Jow six pack has competing choices...invest in rental income and spin off some free cash flowa business like cold stone ice cream, to spin off cash with that $500K, they will invest some in Gold as a superior hedge but it spins off no cash ( even debased cash ).

But economic value works against gold...

Are you wiling to live in a tent, home school your kids thru college, and live off bread and water to save and invest all your discretionary income in gold bars in a Swiss Bank? Come on!!

Thats for high net worth invidivduals. Joe six pack..is focused on inceasing his cash flow so he/she can send his kids to college, get their spouse off their back.

That is both a plus and a minus for gold.

This is not a knock on gold, its about pointing out competing choices, generating yields/cash flow, and maximum efficiency and return on debased currencies.

rknick- i was searching for an equivalent to RDPSX that allows continuous trading during market hours, only to jump back to the cara blog and see you have that covered...thank you

geezer52- if you haven't already, read and re-read bill's WIR/1013p post...having opened your GLD/GDX only a week ago, you may wish to consider taking profits (or even losses) and wait for another entry...JMO...

ALOHA !!

Okay ... I will relive my VW bug memeories. I also had a brown 1968 VW bug, but that was in Newport Beach, California back in 1973 ... NO SNOW! I bought it used for $2800USD from a car dealer! It ran great and I spent that Summer livng in it camped out at Doheny State Beach ... My homeless days! To camp at Doheny was $3 per day. You got your own spot with a campfire ring and they had showers and bathrooms there and of course a very nice beach and surf.

I also went on numerous surfing expeditions down as far as Acapulco, Mexico from 1974 thru 1978. Mostly we went down to San Miguel and Rosarita and Salsepuedes and and Guaymas on the Baha side. Once my friend and I spent three months camping and surfing all the way down to Acapulco. We spent most of our time in Mazatlan. That VW bug ran great!!! NO PROBLEMOS!! I collected lots of Tourista stickers! Driving through the Sonora Desert in mid Summer without air conditioning we each bought a block of ice and put it in our laps! HA !!! Next best thing! Water on the floor yes ... but it didn't last long in that heat! Got harassed by the Federales and the local Policia but the best part was having all the locals hanging out at our cabana at Playa Norte. They taught us where to go to get by cheap! A kilo of corn tortillas for 5 cents at the Tortillaria! WOW!! PEMEX gas was 40 cents a gallon. A hotel room $4 per night. If you hang with the locals its dirt cheap, but if you go where the gringo tourists go its MUCHO DINERO! Life in your twenties was easy-breezy and carefree ... at least mine was! Everything I owned I could fit in a backpack! Kind of wish that was still the case ... Well, by time our government gets done with us I just may be living on the beach with all my stuff in a backpack! HA!! Not so bad of a way to go ... Gaugin died on a beach in Tahiti! Being homeless here in Hawaii is much easier than NYC or Toronto! All you need is a t-shirt and swim trunks and nobody can even tell you're homeless!

My VW did catch fire once due to a loose gas line, but it only cost me $50 to repair it and it was back as good as new! I also recall that I rebuilt the motor myself in my garage where I was renting. I didn't have a jack so I stacked telephone books and lowered it that way! Only four engine bolts and the motor is on the ground! Easy-peasy!! I numbered the parts I wasn't so sure about so I could remember how to put it all back together again. I did it ... It worked! Brand new motor and good for another 200k!

What I'd really like to own here in Hawaii is a VW Thing. Anyone own one of them before? Yep, VW made a good relaiable car that got a lot of us older guys through our youth! Amazing it was started by Adolf Hitler ... I guess we can credit him for the idea of freeways as well ... the Autoban! Those Germans know their cars!

ALOHA !!

EEM ... Joe SixPack with $500k to invest isn't going to buy ETFs or option straddles and sit around watching the VIX either! They'll take that $500k and buy a Hummer or two, a boat, a Rolex and a half-ass house then go on a cruise and a few trips to Cancun and Vegas and call it a day! Whats left, which won't be much, will be put in a 5% CD and then get totally used up in a year paying off credit card debt! The debt will keep rising until he sells his Rolex and boat and one of his Hummers for big losses then pray to God he can hang onto his home long enough to wait and sell it for a profit so he can start racking up more credit card debt!

Do you guys really think the masses are busy reading the WIR and Bernanke's last FOMC meeting minutes? If I mentioned the Perth Mint they'd say, "I like TicTacs better!" There will always be a major part of our society that will be totally clueless and apathetic! They will be the ones that have the biggest voting block and will vote themselves welfare as often as possible and not even think twice about the consequences ... not even on their death beds! Thats the power of entitlements and the promise of a free lunch!

Bill Fleckenstein on the Next Shoe To Drop:

http://tinyurl.com/2m3u8m

Kaimu: Agree..that comment on gold was not directed to 2nd ave, it was meant to have a personal screening method for our financial choices.

Sometimes when I read some of the posts here..I get the impression that gold is being promoted vs educating ourselves on the pros and cons versus alternative instruments.

I learned about gold and the PMs by reading Bills WIR 3 years ago,

I didnt get the impression he was promoting it.

I was always looking for his screening methods, fundamental drivers, and how he evaluates entries and exits. SLW I wont ever forget that one!!

Investments has a season and drivers and when they click..strike. But to buy somethng to the exclusion of asking what else is more attractive and suit my needs is kinda dangerous.

Hyperinflation is going to cause social chaos, always turned off by salesmen peddling fear and their product was the savior. I immediately looked for alternatives.

When I brought in a 401(k) plan for the company...I threw out the first company as they mostly peddled fixed income instruments. Found someone that had greater choices like Fidelity and when we matched it dollar for dollar..most of the employees still wont save the miimum.

Found it too hard for a lot of them to suck it in to build net worth, but a lot of them were starting families..still..little drops of water...

Just want to express appreciation on the excellent posts tonight from Bill and veterans re gold.

I sold all my XGD and SLW at the peak last Wednesday based on tops in daily MACD and corresponding trough in $USD, which seems poised to rally. Once again MACD proved accurate as these have subsequently fallen.

Still long NOT.v, but starting to realize I should have sold at the 7$ top.

Bill.....My guess is your book will be or is a kind of operating manual for all you've developed here. If that's true....cut the middlemen and self publish via pdf. I know to late. But we are always moving forward. And ideas and insights always evolve as things change. Sooo....it becomes an open diary of the evolving mind of a trading wizard with monthly installments. All for pay of course, maybe via something like paypal. Just a an idea.....I'm sure this is territory already covered. Keep up the good work.

2ndAve..

Again thanks for the heads up, yes I plan on taking off my GLD position today and wait for a better re-entry point. I'm up a few shillings right now, however, won't let it ride and will await a better entry point.

Geezer

g52- glad to hear it...you don't mention GDX->if you're still long, be aware that GDX will most likely drop much farther than GLD percentage-wise...