Whatever happened to plying them with alcohol? Besides, isn't the best form of birth control marriage? So whaddya' expect?

Interesting. May be a tad premature, but per the Wizard's Wizdom, Europe cuts, the $ strengthens, and both GLD and SLV (Kaimu's invectives against the two not withstanding) are up...

Ha! Interesting stats. I asked an acquaintance with Pfizer a few years ago the number of heart-attack deaths attributed to the drug. He said avg of 10 a month worldwide. FDA says 130 US men (avg age 64) taking viagra died in a nine month period - but those stats highly suspect (suicide can hardly be blamed on viagra... or could it?)

http://www.fda.gov/cder/consumerinfo/viagra/safety3.htm

This is my problem with the global warming...or is it, climate change now...debate:

http://www.coaps.fsu.edu/~maue/tropical/

For the last two or three years the masters of meteorology have been predicting big hurricane seasons. Nahhhh. So, they can't predict patterns for six months never mind something much more global and long term.

Cara 100 Update:

Price Targets Lowered:

CSCO - from $25 to $20 @ RBC
WFMI - from $15 to $10 @ Credit Suisse

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

Today's Market Music:

http://tinyurl.com/5ndcb3

nemo- speaking of meteorology:

"The Hulbert Financial Digest's investment-letter monitoring through Oct. 31 is now available. It's a disquieting spectacle. Only 12 letters of the 180-plus followed by the HFD have made money in 2008, And the top performer -- Crawford Perspectives, up 33.6% -- uses astrology."

http://tinyurl.com/6apclp

Yesterday I forgot to provide you with the link to the blog that I am referring to. Therefor the repost:

Some days ago I asked the question what if the need for issuing new debts is outpacing the demand from abroad for the same. Brad Setser in his recent post is discussing the latest developments and what we can expect from foreign central banks who are financing the main chunk of us debts. After having read this my conclusion and worry is that Hank and his friends have to scare people into treasuries (which means that we might not see rising stock markets until the end of the year).

Here us a little excerpt from Brad's blog:
Just today the Treasury announced it expected to issue – on net – an additional $500b this quarter. That is a lot by any measure.
I would be surprised, though, if it is all bought by central banks. Or even if most of the new Treasury will be absorbed by central banks. For the first time in a long time, I suspect Americans — not the world’s central banks — will be the main source of new lending to the Treasury.

BH- Dylan's music sounds as prescient in 2008 as it did in 1968...

Sorry here is the link:
http://tinyurl.com/69jsbq

nemo

lack of sunspots, with the sun's cycle has actually cooled the earth.

maybe since the earth is slightly cooler (for a temporary time perhaps) the oceans aren't as warm and not as many hurricanes.

I have the same thoughts as you with the whole subject

2nd:

Gonna' sound strange, but a former paramour took me to have my natal chart done (once). I was kinda' amazed at the stuff she said and how some of it came to pass. I'm sure there's something to it, but I left it in the rear-view mirror.

Regarding Dylan: yeah, just the cycles. Nothing really ever changes, including people's belief they can change what can't be changed.

"Job cuts in the Internet industry, combined with a slowdown in venture capital investment, will cast a pall over the Web 2.0 Summit, an influential technology conference that start[ed] [yesterday] in San Francisco."

"Yahoo CEO Jerry Yang, Facebook CEO Mark Zuckerberg, MySpace CEO Chris DeWolfe, venture capitalist John Doerr and former Vice President Al Gore are among the speakers.

Fear of a major, lengthy downturn has fostered nervousness among startup executives, some of whom are having to scramble for funding as the venture capital spigot runs dry. Even large companies such as Google are scaling back everything from hiring to cafeteria hours in order to better weather an expected slump in Internet advertising."

http://tinyurl.com/5ffuyy

Euro area yield curve continues to sharpens significantly:

http://www.ecb.int/stats/money/yc/html/index.en.html

Gold price rises on the LME are not imaginary.

A bird in the hand is safer than one overhead.

debating if i should close my TM puts at the open...seeing as it's down some 9 points. with their profit forecast of $5 Billion for 09, slap a 12 multiple on that earnings forecast and you get a $60 target...

(Repost to yesterday's blog)

Bill,

This is what is great about your site:

• You write your commentary and help me solidify my thinking on a specific decision.
• ToddinFL is moved to ask for a clarification.
• Your detailed thought path provides a model for future situations including variables in scenarios.

For the past forty years I have done little trading (to keep my commission costs low) and would sell only if a company's fundamentals deteriorated. I have never been a believer in buy and hold as a substitute for judgment. More active trading is the only thing which makes sense in volatile times like these. Long term additions will come in time.

I am inclined to think in macro terms (my advertising background?) and we can see a globally, universal distrust apparent toward governments, financial agents and official data and pronouncements. We must be more alert and agile than ever and it may be so for some time to come.

I have written to several sources asking the same question, "What will happen if foreigners do not want to buy anymore US debt?" I have not received any direct answers, but am beginning to see the same question in a variety of articles.

Brad Tottle, Raymond James, "...those countries who have historically been large purchasers of our debt are facing problems of their own. If the big foreign central banks have to take a more defensive posture at home, it means lower reserves to invest abroad." (11-3-08)

Bill Fleckenstein, Contrarian Chronicals "I can't see why foreigners would fund a couple of trillion dollars in spending in our currency, given our recent behavior." (11-3-08)

James Jubak, MSNBC, "Global Economy Depends on China" (11-4-08) The article points out China's domestic economic needs call for most of its investment for the immediate future.

I have never had a course in economics, but it seems to me this lack of foreign "propping up" would be deflationary in the US with a strengthening of the dollar and an increase in saving. In this case in may "trickle up" from individuals (of necessity) to government spending. Lower income means fewer tax dollars for congress to play with. (Lobbyists may need to find real jobs!)

AES has suggested, Americans rather than the world's central banks, may be the main source of lending to the treasury. If so, I think it would be a major shift in group thinking and could force a national change which politicians have been ignoring — the switch from a credit to an asset economy. Savings invested at home instead of relying on the largesse of others.

[Bill Cara note:

Thanks for the compliment and the participation. Without real people like you and many others here discussing serious matters in a respectful way with people they have never met before, this community would not be as strong as it is. The public has to recognize that the leaders in business and politics are people just like us -- they put their pants on same as us, I say -- with one exception: those people have other interests to serve and we have only our interests to take care of. If we can have an honest dialog with "us", then over time we will make better decisions. Just by talking and thinking, we are learning.]

actually, i take that back. $5 Billion in profits equates to $3.33 EPS. Given its current price of $71/share price in pre market, I still think this has some 30 points downside.

Which is the indicator of long term trend?
The same is true of markets as well as weather, right?

Therefore the short term predictions and movement may not accurately indicate longer term trends.

Can't we, as total laymen, leave this to the experts? I'm not a climatologist and as far as I know we aren't blessed with one here. I also am not a Nuclear Physicist (I do have the merit badge) and pretty much avoid the intricacies of Physics for those reasons. We can all stand around and urinate in the wind on this, but it is what it is. In the end we don't have enough info to say much. The trouble starts when average "Joes" start doing work they aren't qualified for. I know I'm not qualified for anything but uninformed opinion on this topic.
I do see vast areas of the polar ice caps melting, that I can see. I have to look at the really long chart for that. Do you think Scottrade has that?

low bids on HBAN, AAI, FCP, STEM

Cara 100 Update:

Price Targets Lowered:

AMAT - from $15.25 to $11 @ Credit Suisse
INTC - from $19 to $18 @ AmTech Research

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

2nd,

The Bob is still one of my favorites. Not a great player or vocalist but his songs are top shelf.

Ever see his bizarre performance of "Things Have Changed" at the Oscars? Dressed like an undertaker with shifty eyes.....one of his strangest presentations to date.

Regards

putting in some stinky bids.

hurricane forming off Honduras, pointing at The Bahamas

[Bill Cara note:

The approaching cold front from the north should keep the storm well to the south of Nassau as it passes by on Monday. Being about +10 ft from sea level, I may have to move to higher ground on Monday. Maybe I'll take the day off. Anyway, this should be the last of the cyclones. The humid weather has gone now. The days are becoming nicer -- more sun and a constant high at about 80.]

Sharky:

Do you remember the Farside cartoon titled "How birds see the world"?

KRY - Per Otto, KRY has taken in $460M in equity offerings since 3/04, yet only spent $120M on mine development. He asks: where did the rest of the money go?

http://incakolanews.blogspot.com/

[Bill Cara note:

To be fair, the Company has made Richard Marshall, VP of IR, at your disposal. Why not somebody all or write him for an answer rather than just take the word of one source?]

nemo- i can't say whether i've seen it or not, but i'm sure the answer is target practice..

nemo - I believe in reduced radiation from the planet sun. So far, no signs of a colder winter here though, aside from my wallet girth indicator, that is.

So, why is Gold and Silver up when the Euro is down and the USD is up?

Do Gold and Silver all of a sudden follow the dollar now instead of the Euro?

Or is it just that the crowd expected Gold and Silver to drop with the Euro on the rate cuts so the big money is taking them the opposite direction?

I have more calls on GG and SLW than I have puts on GG so maybe I'll just hold my puts for now.

I did great on the UYG calls I bought last week and sold Monday but now am giving it back with the GG puts.

It's hard to catch all these curve balls lately.

Rob.

impressed with golds action right now.

even more impressed w/ the PM shares moving up against the broad market.

hopefully this is not just a morning anomaly.

a few days of a disconnect of miners and the market along w/ a gold run above $780 might be the signal many have been waiting for.

its too early to tell from my side, need to see this play out for a while longer.

[Bill Cara note:

I just said the same to my traders. As the Euro and Pound have dropped a lot and the USD gained this week, the prices I have posted in the morning for the precious metals have not fallen. They have gained. Look at gold: 738.61 (Mon am), 743.10 (Tues am), 760.81 (Wed am) (a couple hour spike), and 741.86 (this morning). Palladium: 198, 210, 214, 222. Platinum: 836, 837, 877 (same spike), 857. Silver: 10.14, 10.12, 10.26, 10.41. Do you see the trend? Yet the $USD has moved up from 85.755 to 86.11, nd the Euro moved down from 128.31 to 127.30. At the same time, oil dropped from 67.16 (Mon am) to 63.88 (this morning), as expected. This is what I told my traders on my 8:30am ET squawk box call.]

"AES has suggested, Americans rather than the world's central banks, may be the main source of lending to the treasury. If so, I think it would be a major shift in group thinking and could force a national change which politicians have been ignoring — the switch from a credit to an asset economy. Savings invested at home instead of relying on the largesse of others."

Grym: This is why when I heard of that plan where we might be offered to fork over our 401k to the gubmint, I wanted to no more. That Miller fellow, who runs the 401k oversight has also made the statement that the government can not afford to forego the tax revenue that could be collected on capital gains and dividends in deferred accounts. Why is it so unimaginable that they come up with a story on how it's better for us to give them our money? I can see it becoming mandatory...for our own good, of course.

Sharky:

Close...it's a picture of two birds sitting up in a tree, and everything they look at has a bullseye on top of it (heads, dogs, cars, etc...)

I saw Bob in Van a couple of weeks ago. Wicked band, still blowin a mean harp. All agreed it was a good ticket.

Alright, keep up the Dylan talk it's helping....

I was flipping though the XM channels on the tube last night and "Cruel to be Kind" jumped out of the TV and latched onto my tape loop.
Make it stop!

I think I'm starting to get a bar of "Everything is Broken", that should help....

RE: Global

I have to say, sunspots along with solar radiation and cloud cover do effect global temperatures or so history says it does.

Re: Europe

Did anyone catch the Trichet comment about there not being a credit crunch?

Bill does this relate to HB&B not wanting to lend or how do you see this?

still sticking with my TM puts. I see the downside of this at around $40/share.

Into QUA.to at $4.68 after selling at $6 two days ago

ALOHA !!

And here we have it!!! THIS IS WHY I NO LONGER CONTRIBUTE TO RETIREMENT. I have thought for years that a desperate US government would either tax the hell out of you when you are forced to liquidate or they will make radical changes to the rules to where your retirement funds would be virtually under government control. I believe I commented a couple weeks ago that if it ever became part of Social Security that many Americans fate might be tied to the $99.2tril of unfunded liabilities.

They have started debate and you know what that means and they wasted no time right on the day OBAMA was elected. I guess that way it would not be a campaign issue!

Man, US Voters have to be the most misinformed and manipulated entity on the face of the Earth! I almost used the word "stupid", but decided that there were more powerful forces at work via the media and the euphoria that would override just plain stupidity! Or are we headed for IDIOCRACY?

READ ON:
Carolina Journal Exclusives

Dems Target Private Retirement Accounts
Democratic leaders in the U.S. House discuss confiscating 401(k)s, IRAs

By Karen McMahan

November 04, 2008

RALEIGH — Democrats in the U.S. House have been conducting hearings on proposals to confiscate workers’ personal retirement accounts — including 401(k)s and IRAs — and convert them to accounts managed by the Social Security Administration.

Triggered by the financial crisis the past two months, the hearings reportedly were meant to stem losses incurred by many workers and retirees whose 401(k) and IRA balances have been shrinking rapidly.

The testimony of Teresa Ghilarducci, professor of economic policy analysis at the New School for Social Research in New York, in hearings Oct. 7 drew the most attention and criticism. Testifying for the House Committee on Education and Labor, Ghilarducci proposed that the government eliminate tax breaks for 401(k) and similar retirement accounts, such as IRAs, and confiscate workers’ retirement plan accounts and convert them to universal Guaranteed Retirement Accounts (GRAs) managed by the Social Security Administration.

Rep. George Miller, D-Calif., chairman of the House Committee on Education and Labor, in prepared remarks for the hearing on “The Impact of the Financial Crisis on Workers’ Retirement Security,” blamed Wall Street for the financial crisis and said his committee will “strengthen and protect Americans’ 401(k)s, pensions, and other retirement plans” and the “Democratic Congress will continue to conduct this much-needed oversight on behalf of the American people.”

Currently, 401(k) plans allow Americans to invest pretax money and their employers match up to a defined percentage, which not only increases workers’ retirement savings but also reduces their annual income tax. The balances are fully inheritable, subject to income tax, meaning workers pass on their wealth to their heirs, unlike Social Security. Even when they leave an employer and go to one that doesn’t offer a 401(k) or pension, workers can transfer their balances to a qualified IRA.

Mandating Equality

Ghilarducci’s plan first appeared in a paper for the Economic Policy Institute: Agenda for Shared Prosperity on Nov. 20, 2007, in which she said GRAs will rescue the flawed American retirement income system (www.sharedprosperity.org/bp204/bp204.pdf).

The current retirement system, Ghilarducci said, “exacerbates income and wealth inequalities” because tax breaks for voluntary retirement accounts are “skewed to the wealthy because it is easier for them to save, and because they receive bigger tax breaks when they do.”

Lauding GRAs as a way to effectively increase retirement savings, Ghilarducci wrote that savings incentives are unequal for rich and poor families because tax deferrals “provide a much larger ‘carrot’ to wealthy families than to middle-class families — and none whatsoever for families too poor to owe taxes.”

GRAs would guarantee a fixed 3 percent annual rate of return, although later in her article Ghilarducci explained that participants would not “earn a 3% real return in perpetuity.” In place of tax breaks workers now receive for contributions and thus a lower tax rate, workers would receive $600 annually from the government, inflation-adjusted. For low-income workers whose annual contributions are less than $600, the government would deposit whatever amount it would take to equal the minimum $600 for all participants.

In a radio interview with Kirby Wilbur in Seattle on Oct. 27, 2008, Ghilarducci explained that her proposal doesn’t eliminate the tax breaks, rather, “I’m just rearranging the tax breaks that are available now for 401(k)s and spreading — spreading the wealth.”

All workers would have 5 percent of their annual pay deducted from their paychecks and deposited to the GRA. They would still be paying Social Security and Medicare taxes, as would the employers. The GRA contribution would be shared equally by the worker and the employee. Employers no longer would be able to write off their contributions. Any capital gains would be taxable year-on-year.

Analysts point to another disturbing part of the plan. With a GRA, workers could bequeath only half of their account balances to their heirs, unlike full balances from existing 401(k) and IRA accounts. For workers who die after retiring, they could bequeath just their own contributions plus the interest but minus any benefits received and minus the employer contributions.

Another justification for Ghilarducci’s plan is to eliminate investment risk. In her testimony, Ghilarducci said, “humans often lack the foresight, discipline, and investing skills required to sustain a savings plan.” She cited the 2004 HSBC global survey on the Future of Retirement, in which she claimed that “a third of Americans wanted the government to force them to save more for retirement.”

What the survey actually reported was that 33 percent of Americans wanted the government to “enforce additional private savings,” a vastly different meaning than mandatory government-run savings. Of the four potential sources of retirement support, which were government, employer, family, and self, the majority of Americans said “self” was the most important contributor, followed by “government.” When broken out by family income, low-income U.S. households said the “government” was the most important retirement support, whereas high-income families ranked “government” last and “self” first (www.hsbc.com/retirement).

On Oct. 22, The Wall Street Journal reported that the Argentinean government had seized all private pension and retirement accounts to fund government programs and to address a ballooning deficit. Fearing an economic collapse, foreign investors quickly pulled out, forcing the Argentinean stock market to shut down several times. More than 10 years ago, nationalization of private savings sent Argentina’s economy into a long-term downward spiral.

Income and Wealth Redistribution

The majority of witness testimony during recent hearings before the House Committee on Education and Labor showed that congressional Democrats intend to address income and wealth inequality through redistribution.

On July 31, 2008, Robert Greenstein, executive director of the Center on Budget and Policy Priorities, testified before the subcommittee on workforce protections that “from the standpoint of equal treatment of people with different incomes, there is a fundamental flaw” in tax code incentives because they are “provided in the form of deductions, exemptions, and exclusions rather than in the form of refundable tax credits.”

Even people who don’t pay taxes should get money from the government, paid for by higher-income Americans, he said. “There is no obvious reason why lower-income taxpayers or people who do not file income taxes should get smaller incentives (or no tax incentives at all),” Greenstein said.

“Moving to refundable tax credits for promoting socially worthwhile activities would be an important step toward enhancing progressivity in the tax code in a way that would improve economic efficiency and performance at the same time,” Greenstein said, and “reducing barriers to labor organizing, preserving the real value of the minimum wage, and the other workforce security concerns . . . would contribute to an economy with less glaring and sharply widening inequality.”

When asked whether committee members seriously were considering Ghilarducci’s proposal for GSAs, Aaron Albright, press secretary for the Committee on Education and Labor, said Miller and other members were listening to all ideas.

Miller’s biggest priority has been on legislation aimed at greater transparency in 401(k)s and other retirement plan administration, specifically regarding fees, Albright said, and he sent a link to a Fox News interview of Miller on Oct. 24, 2008, to show that the congressman had not made a decision.

After repeated questions asked by Neil Cavuto of Fox News, Miller said he would not be in favor of “killing the 401(k)” or of “killing the tax advantages for 401(k)s.”

Arguing against liberal prescriptions, William Beach, director of the Center for Data Analysis at the Heritage Foundation, testified on Oct. 24 that the “roots of the current crisis are firmly planted in public policy mistakes” by the Federal Reserve and Congress. He cautioned Congress against raising taxes, increasing burdensome regulations, or withdrawing from international product or capital markets. “Congress can ill afford to repeat the awesome errors of its predecessor in the early days of the Great Depression,” Beach said.

Instead, Beach said, Congress could best address the financial crisis by making the tax reductions of 2001 and 2003 permanent, stopping dependence on demand-side stimulus, lowering the corporate profits tax, and reducing or eliminating taxes on capital gains and dividends.

Testifying before the same committee in early October, Jerry Bramlett, president and CEO of BenefitStreet, Inc., an independent 401(k) plan administrator, said one of the best ways to ensure retirement security would be to have the U.S. Department of Labor develop educational materials for workers so they could make better investment decisions, not exchange equity investments in retirement accounts for Treasury bills, as proposed in the GSAs.(more)

There is more so I have provided a link, but it is more political in nature.

Link: http://tinyurl.com/6ec7cg

Sold half TM puts and moved those into LVS puts.

long XTEX @ 8.69, do ur own homework

WGW is still "the little engine that could" today.

Discourse about global warming.

This brings to mind the Chicago Climate Exchange (CCX) and the Chicago Climate Futures Exchange (CCFE), where you can trade futures and options contracts on emission, allowances and other environmental products.

http://www.ccfe.com/

http://www.chicagoclimateexchange.com/index.jsf

I have not traded on either and provide only as information.

MORE political in nature? How could that be? LOL! What you provided was scary enough.

Outlandish and politically undoable suicide, but scary.

Kaimu,
I would think that story you mention could be the reason why Gold and Silver are strong here.

Can anyone even imagine how bad it would be for the market if the house even voted on such a bill?

It seems eerily similar to when FDR confiscated everyone's gold. Back then Gold and farms were people's major forms of wealth and both were confiscated for the "common good".

If this Bill gains any steam at all there will be a mad rush for everyone to cash in their retirement accounts all at once. A mass exodus like that would make the drop so fare this year seem like nothing.

Maybe this is what Biden was talking about before the election when he said Obama would be forced to do something extreme that not many people would agree with but we'd have to trust him more then than ever.

If Obama really does believe in the vision of our founders like he proclaims, then he must understand how wrong it is to rob Peter to pay Paul.

Rob.

Obama wouldn't have to do anything extreme, just declare monetary bullion an instrument of foreign exchange, and remove any royalty taxes, sales taxes or prohibitions on the trade of gold, and have the gold of fixing bullion prices to the amount of printed currency out there. Gold would do its work.

I'm certainly willing to accept the spectacle of a parallel rise in USD with POG, but this USD strength seems like an economic shot to the foot in terms of export trade. Perhaps it's more of a necessary evil, like re-booting a computer for instance.

Regardless, still can't get my arms around the dynamics of a prolonged parallel rise, which I'm trying desperately to comprehend.

Bottom line: Does a smart trader sell the rally in anticipation of re-loading, or sit on his hands?

proudPapa

My thanks for your doing the research and math on NBD-T yesterday. It certainly supports the anticipation that they'll have to slash their dividend. I suppose that leaves me with the question of whether the stock price already has that factored in or whether I'm better to take the loss and look for greener pastures, (the metaphor would better suit and agri-stock, but I can't think of one for building products right now).

CP, you have a low interest rate environment in two of the largest economies in the world, U.S. and Japan. Now, Europe is about to join them.

VZ developers: GRZ up 9%, KRY down 4%

This fits with Otto's thesis that GRZ at .60 has value and will be forced to sell to Rusoro, while KRY will simply have their contract cancelled.

Why bother with this? 30-50M oz. of cheaply mineable gold in a country which needs Cash is in the balance.

http://incakolanews.blogspot.com/

SLW -getting killed even though SLV is up!

ABX,GG,WGW,RBY all holding in there for me.

80% cash, just miners for me right now.

Chicken,
I would have sold the rally in SLW and GG if they had gotten higher but neither went high enough for me to sell at this level.

That's why I'm hoping the puts work out to reduce my cost basis on the longs.

We could also see dollar weakness tomorrow if the jobs report is really bad.

So, with the current trend will that mean Gold goes down tomorrow or is it trading by itself now because of a lack of confidence in everything coupled with the fear of confiscation of paper assets?

Rob.

EWV - I just witnessed +8%

stopped out of SSRI at 9.96. yahoo.

re:EWV

50 DEMA is 110.88

re:LAMR

buy limit 12.21.

If the USD weakens tomorrow then gold goes higher. It is strong today with the USD because the Euro and Pound are down on their rate cuts.

With possible weaker USD then all three fiat currencies mentioned will be weaker vs gold.

ALOHA !!

All the "what ifs" aside it seems more prudent to me that paying off one's DEBT would be wiser than throwing hard earned money into a money pit subject to US government whims. Can anyone say for sure the US government will still be solvent in five years? Ten years? Twenty years? Next Summer? I do guarantee you that your elected politicians will siphon every bit of "wealth" they can before the US government declares a default. When it comes to politics the US government has shown it is no different than that of Argentina. Which one of us here voted for the $700bil US BANK BAILOUT? Show of hands!

All you have to do is ask any retiree who is now burdened with DEBT, living on a fixed income, just how prudent it was to hold that DEBT into retirement? My guess is that 99% would say they should have paid off their homes and cars first before retiring or before contributing to retirement funds. Now many are being forced to liquidate portfolios at market lows, since there are very few mutual funds that are up in this environment. I am sure most who took control(self managed)over their IRAs are not faring much better and maybe even worse.

IT ALL WORKS UNTIL IT DOESN'T ...

I personally trust no government!

Cara100: JCP

Last Price Today’s Change...a discretionary stock fighting the rough retail waters.

23.90 +1.67 (+7.51%)

On 401k confiscation. Remember also Miller said that the government cannot afford to forego the tax revenue from the deferred capital gains and dividends. If just talking about it, and perhaps introducing legislation induces people to cash in their 401k, they can then drop the legislation and have accomplished what they want.

Rob - "neither went high enough for me to sell at this level."

Agree completely! Simply waiting to see what happens then sell when prices come to me. Still expecting higher prices but maybe not until Obama's medicinal prescription is penned.

how quickly things reverse course from this morning.

spot gold moving down to $742, shares getting hammered again. TCK taking back some of this monday's gains.

USD hovering in the 85.10 range. wondering if rate cuts abroad really had an effect on the USD.

im reading Eric Sprott's piece published on 321gold and he is begining to sound like mr. john embry and his recycling of the same old arguments for gold to rise... eventually... no mention of gold stocks which much of sprott's precious metal funds are holding, and suffering through.

i find this point interesting.

if currency crisis are what's causing much of the flight to the US dollar, then wouldnt the new round of crisis ahead in other nations only continue to feed the USD rally as opposed to all the top callers saying its done? again no logic to back up their claims.

11 am price curfew in effect for bullion when the LME closes down for the day.

Craig,
So it sounds like you're thinking that Gold is starting to decouple from the fiat currencies now, instead of following them.

If that is true we could see a major move up in Gold and Silver as soon as tomorrow right?

Rob.

I'm watching GSP, total commodity index, for a potential buy. RSI 7 day is 35.

re:XTEX.

per usual, I bought too soon.

I'll put a buy stop above the 3PM price.

Steel sector is getting pummeled again today.

MT hit a low of $19.14 on 10/27 and then topped out at $33.13 on 11/04 and has been killed after reporting earnings - currently trading at $21.40.

Double bottom would be a huge positive. I am looking for indications of a double bottom and eyeing Jan10 calls on $20 strike for MT.

Fransix - Please help me to understand what you posted also I can't find LME is that a stock symbol?

LME - London Metal Exchange

Rob: We have interrelationships between fiats and the resultant moves as each holder tries to hedge loss....which is at this point the dollar and PM's for euro and pound holders. If the dollar gets weak then it just adds to the demand for a hedge from one more fiat. The compounding relationship is USD/Yen which just confuses the issue and adds another hedge (or not).

Then of course one changes and throws everyone off, like today.

EWV - I see $110 DEMA 50 on one month chart but completely different conflicting story on shorter charts.

Here is link for lurkers of this blog who are afraid to ask questions on trading terms, ie buy stop, stop limit etc.

http://tinyurl.com/65pyge

ronK

Chickie,

I'm using the Sharpcharts on stockcharts.com. Daily charts, 50 day exponential moving average=111. 10 day ATR (13.995).

It doesn't matter, just stick to one charting package/site and trade off that.

Daily MACD is turning up BUT the weekly is about to cross to the downside. My guess is that these moves don't last more than another couple days.

A decline in oil prices has been causing a demand for dollars, as there are probably innumerable hedge funds betting on a price rise.

On a day like today, though the dollar is only up a smidgeon while all other currencies and oil sell off. Could denote a change in the dynamics of oil and currency.

Looks like Geologix (GXEXF) is finally finding some footing. This may be related to an increase in resource estimate in one of their locations. If the junior miners are beginning to hold up, maybe.....

http://tinyurl.com/6gy47y

Good day to go fishing

November put volume on LVS is EXTREMELY high. I believe they will be bankrupt within the next few weeks.

POG - Paper money deflation in process, these runs into gold make me think there's going to be a large pop at some point. Flat, like an rotten old tire. Perhaps we should be trading the rate cuts?

Sharkie,

I was thinking about splitting some wood. LOL

If it weren't raining so bad, I'd go hunting...

Craig,

I can agree to some degree with you wanting to "leave this to the experts", but only in the "wanting" part.

For years I did so. I think we can no longer afford to do it. Look at what the "experts" have done to us and are doing to "solve" the result.

Short term on the weather I look out the window and dress or plan accordingly — I will now do the same with my money.

Hey Kaimu!

You're late to the party...that's different...we were talking about that yesterday.

out qua.to at $4.4, small loss, into Tck.b at $11.72

this plunge here in the POG is interesting as its following weakness in the broad market.

USD not up that much today, so more is at play.

whatever it was that was sending gold and the market lower remains a powerful force and there is nothing beyond speculation that this patten will change. when it changes it changes and the evidence will be clear from price and volume action, and not articles about bond defaults, swaps, COMEX failures, currency arbitrage and interest rate cuts.

none of the above have come true yet and have had no impact yet on the markets as they hover around the recent bottom.

"this plunge" in bullion did not follow "that plunge" in European markets on the LME, or in Asian markets on the TOCOM last night.

http://finance.yahoo.com/intlindices?e=europe

In the U.S. all trades in commodities are tied to the oil price fall, so if oil falls, then everything falls. One of the only commodities to have held up is gold, primarily because of macroeconomic factors such low interest rates, currency declines on the forex. A heavy handed assist in the form of investor demand, even in a trapped market overwhelmed by secondary lien financing in derivatives has prevented an utter collapse in bullion prices even as prices have utterly been smashed in oil futures, or just about every other commodity.

A decline in gold prices at this point in this kind of a market means that the total supply of hard currency must be dwindling.

Like watching an inchworm crawl.

I don't understand this doubting experts thing.
It only results in trouble.

We have all kinds of sayings about this problem, "The lawyer that represents himself has a fool as a client" and so on. None of us does surgury on ourselves, we leave it to experts.
Do they make mistakes? Yes, they are human, but for the most part people with good lawyers do well and people routinely get surguries that improve or save their lives.

That is true for almost all areas of expertise.
There are good and bad. The bad rarely overcome the good and by and large experts know more than the average joe, which is why we call them experts.

For example, there were some professional results listed here a few days ago by a real professional. An expert by any measure.
Can you get those kind of returns with your average skill? I can't.

I can learn how and in the process become somewhat of an expert, but right now I'm just like you.....I look out the window and dress accordingly.

Of 208 Morningstar sub-industries only 16 are positive.

Looks like we're going to test the 10/10 and 10/28 lows !

Craig:
I hear what you're saying, but on something as far reaching, I simply don't think they've proved anything. How can they know. The market has many less variables than the climate, or at least many more have been defined upon which certain individuals create outstanding performance.

I have yet to see such outstanding performance from meteorologists/climatologists.

LVS down 40% now.

Hi, I'm a long time Bill Cara fan, long time lurker and long time trader...just humbly introducing myself so I'm not a total stranger.

F6: Hence the higher treasury yield?

Kaimu,

Fortunately I did exactly hat you described — paid for the home, cars, etc — no debt since 1981 (temporary car loan) I am retired. (Well, forced out of business by the Free Market exporting of all my manufacturing clients.)

In my view as a former businessman, the US government has been insolvent (by any legal accounting method) for as long as I can remember. From what I have read our present way of dealing with the financial crisis is the traditional government/Wall St. unified approach.

In The Great Depression first they bailed out the banks, insurance and railroads — now banks, insurance and perhaps the autos. (?)

We must NEVER trust government. The writers of the Constitution knew this would always be the case, hence the provisions of checks and balances and the Bill of Rights.

I recently read in Terkel's "Hard Times," there was a planned attempt to set up a fascist dictatorship here in the mid-1930s.

It will only work to the degree that we make it work. I wish Obama well, but will want to see delivery on the promises he has made. He has a lot of loopholes available not to do so.

good point craig,

the difference is, many "experts" get paid very well for giving advice that has often proven wrong.
these people are claiming to experts at a skill who's ultimate goal is to make you money.

if they dont make you money they are just financial weatherman and earn their keep the same way a charismatic preacher does.

being wrong doesnt mean one is no longer an expert, though being wrong for a certain period on multiple issues damages one's credibility.

i dont get paid for being wrong, i only get it if im right. mabye i should have spent less time learning to trade and more time learning to set up a newsletter writing subscription service!!!!

My local weather people tend to get it right in a far higher percentage than the average trader with all those supposedly well defined variables.

We all know the average trader isn't right more than 50% of the time and my local weather forcasters are right at least in the 70th percentile.

Trade the rythym.......

That is where research comes into play.

When we go to Doctors for instance, we tend to get references and check them out...same for Certified financial Planners, etc.

We only have their record of success as a guide.

That doesn't prevent quacks and charlatans from giving it a go. That's why we have professional organizations, to weed the creeps out.

I know your issues with newsletter writers....
but until they are made to list their actual investments and returns then all you have is their word.

I was speaking about Bill...Craig.

An a 3 day forecast is about all they're good for.

Am I the only one that gets the feeling this might accelerate to the downside.

Nemo,

I mentioned my bat sense tingling yesterday. The 10 day ATR is 469 so we're not there...yet.

BUT I'll be putting sell stops under the 3PM price of the shorts. And some buy stops above the 3PM price for some etfs/stocks I've been watching.

I don't know I can do it longer myself.
Right now I predict it's going to get colder for several months. It's going to rain and snow more than it has in the last few months if you live in the northern tier states or Canada. Then it's going to get warmer after that. :>)

GG looks to be going down on higher volume than any day since it's advance started on Oct 23rd.

The low then was 15.39.

I'm thinking if it starts to fill the gap from 18.73 to 20.30 it made between Monday and Tuesday, I'll sell my puts.

Rob.

"I've been completely successful at learning to swim on my own, along with helpful advice from experts. We must realize they can only provide the lesson, the objective is to execute the strokes and swim for yourself."

Mark Spitz

blue bluff - Welcome!

Grym - RE post: "I recently read in Terkel's "Hard Times," there was a planned attempt to set up a fascist dictatorship here in the mid-1930s."
Do you recall some of the well known names of those implicated?

Craig...I think you have a career ahead of you

stopped out of BC at 3.3. Took a beating on that one.

Bought it in my pre capitulation indicator days as in "This POS CAN'T get any lower"

I watch the squirrels. If they're really busy collecting acorns it usually means a cold winter. This year is average to slow, I'd say. It feels colder to me though.

happy not to be green so far. HBAN FCP even; AAI, STEM (+01, +08) and (toot-toot) UAUA +.65

How paltry compared to Bill's spectacular results. 3,500% on rio!!!

sorry, xxx "not to be red"

Pookster: No acorns, what do the squirrels do?

LOL! It's not hard Nemo.
I could wake up and without looking tell you with probably 80% accuracy it's going to be raining here until next July. Easily until March.

Looks like Bill is going to get some heavy weather...http://tinyurl.com/5nb97c

I did make some money on the long side on Bill's last week call but more and more I have seen in the last couple of months that the put side is working out extremely well. Maybe the market is telling me something.... If its going to be a traders market for a while, i might just be better off playing the range & volatility

MS Strategist's call......http://tinyurl.com/58nxhe

nemo - No acorns are nature's way of controlling population growth and creating migration so as not to deplete resources. Humans experience the same, except for the ability to evolve externally.

bsi
Just bootstrapping along with a mighty assist to you bsi. I'm working a day job so have no time to get up to speed on charting technique right now, but I appreciate info on charting over past 24hrs. Thanks a bunch. It looks manageable even to a luddite like me. Enjoying the ride on EWV, SIJ, SKF, and EEV. So EWV is now over 50DEMA of $110. Is it time to leave the party? Or wait til 3PM and then place the stops. If you've got a minute, can you post the 50day EMA on the others?

I appreciate that your path has covered my forays into metals producers today.

Direxion launched 3x etfs yesterday with more to come, just sold some sds @93.50 bought 2 days ago at $ 78.00, nice 20%, dont want to wait till 3 o clock and get greedy, i only had 100 shares and with the 2x was enough to get me going silly, can you imagine 3x, ouch.

yvrapx - For comparison, if they even exist, it would be interesting to see those indicators for the period 1929-1933

WC,

When I can generate some 15-20% gains in a couple days, I want to protect those gains. There's always another bus (stock). I'm gonna put sell stops under the 3PM prices. If the big boys don't want to take them home, I don't either. Keep in mind that opts expiration week is generally (not always) positive AND as John Crudele has said, the big boys will do what they have to to earn their yr end bonuses.

I'm not sure the 50 DEMA means much but here's my calculated stops which is the 10 day ATR X 5%.

EEV 1.18
FXP 1.07
TWM .66
QID .40
TLL .60
DXD .43
SDS .53
EWV .72

I'll probably use those as the stop and 2X as the limit esp if ask/bid is wide.

Your mileage may vary, objects appear closer, etc.

thankyouverymuch!

Interesting that treasury yields don't seem to be moving any lower today, which would indicate this equity sell-off isn't prompting a flight-to-safety into US debt. Have all the bond-shorts who would have provided support by covering been killed off? How long before treasuries fall and smart money starts chasing PMs ?

http://www.safehaven.com/article-11755.htm

The thought of "Pent Up Demand" keeps eating at me.

Shipping is down... noise says it is due to decrease in demand for goods but that much?,,, deeper one finds that the freeze-up in Letters of Credit may be a bigger reason... how much demand is there for these Letters of Credit? From my readings there appears to be a goodly amount.

Automobiles etc, which I still think are a bigger driver (pardon the pun) of the economy than we are hearing about... I come from an auto town and have lived 65 years thru downturns that some of you haven't.... I cannot believe that there isn't PENT UP Demand...

New Issues, IPOs etc.... Pent up demand

Money on the sidelines... as Bill says where is the volume?.... pent up demand

It takes me back to my coaching days when I would get that gut feeling that the team was going to explode to the positive side very, very soon.

My generation learned to save more and would hunker down for a long while after times like this but we are becoming a blip in the human demographics. Today's world is made up of spenders and when the money starts to flow they are going to spend again.

Rusoro up 28% on one trade of 250K shares. Go, Russkies!

$indu ATR is 476 points so this move is just "average". ;)

Back in SOL at 6.13 = approx fib 38.2% retracement.

These prices are silly. They are on avg reporting 200-280% increase in net revenue for the qtr year-over-year and 40% sequentially.

Mkt cap is $421M at $6.20. Thats less than this yrs revenue, if SOL stays on track.

Last earning release
http://tinyurl.com/6zrn9g

They report again Nov 18

If my old saws "What everyone knows isn't worth knowing" and "The market will do what will hurt the most people in the worst way" come thru, the employment report will be just awful and the markets will rally inspite of it. LOL

A note of thanks to dapoopa
His post on Oct 17, 7:47pm on the Russian markets
gave us a view to consider, specifically the big picture in emerging markets and the russian stocks in the CARA 100.
If you looked at VIP that day, you had four trading days to watch it collapse from 14 to 7, then two trading days to see the 6 handle. It then quickly rose on heavy volume to 19. Oh the humanity! I'm not knowledgeable enough to comment on whether the tools of TA could have spotted this reversal, but that was one nice move.

Congrats to anyone who bought and sold. But not I. After considering the risks, I placed a stink bid at 7 during those two days. Did I get it? No, because I psyched myself out; "ooh, this is going lower still. I'll pull the bid." Oh Well. Kicking myself to this day. I guess successful traders give themselves a moment to scream and then calmly say, "Next!"

Dapoopa's piece is a prime example of the thousands of sets of eye Bill mentions. I appreciate everyone's opinions, the arguments that follow,the detailed TA discourse and everything else off topic.
I'm not a day trader, just a middle aged guy trying to independently manage a 401k who wants to say "I can beat the market indices!"

Thank you Bill for all you're doing here.

And a shout out to blue bluff; welcome aboard.

stopped of SYT. quick and the dead.

Disconnect on market decline and safe haven activity in Treasuries explained as follows by Bloomberg today ---

As mortgage rates rise, investors may enter into swap contracts to make fixed-rate payments and receive floating-rate payments to reduce the duration, or average maturity, of their portfolios. Dealers who accept the fixed-rate payments in turn often sell Treasuries to hedge their risks, fueling the trend of rising rates.

Not sure I fully follow this, but for what its worth with this downdraft I would expect the 10 year yield to be moving down more with the rise in pricing.

re:FTSE down 114 pts in first 30 minutes.

Last hour down 17 pts.

JohnE agreed but it would have little relevance unless you used a true dollar value on the index.
I think the point is, and it seems like a stretch on days like this, that there is more opportunity going long now than short in the composite.

i guess this is when fundamentals can help with my confidence. Do i know SOL or others wont go down futher, prob not. but some of the prices have come to a point where if i had Warren Buff money, i would be buying some of them on the cheap right here.

Letters of credit...almost anything shipped in a container requires letters of credit. Without them world trade isn't world trade anymore.

^HSI Hang Seng

Down 915 in first 30 minutes.

Down 26 in last hour.

Still looking at getting back into SLW in the $3.66(CDN) $2.82usd area.

Being nimble in today's market is a pre-requisite but bear in mind that optimism at the end of the day is what drives society. Negativity keeps the over optimistic from getting out of hand but the bias is to the positive. Once enough bad Q's are cooked into the market sunlight will shine again and the world will not have ended. Use the overwhelming pessimism to establish a core of company's you can live with for more than a day/week etc.

Re: Alt Energy Plays

I think it was last week some here started talking about alt. energy companies in light of the election. MTZ has an alt. energy segment and it's stock is popping right now on positive earnings report.

Mastec started out diggin' ditches here in Miami. They recently acquired a wind energy component maker.
To my amateur eye, the MTZ chart seems to point to an upward move. Any thoughts are appreciated.

Boy, am I glad that I didn't buy anything at the close yesterday! When the market is on the way down, it is indeed safer to keep placing buy stop limit orders than buying at the close. My buy stop limit order on ESLR did not get triggered, and now I can buy ESLR at a much more attractive price. However, I won't do it just yet, and instead will try to buy some SLW call options.

Jock

More news on Reuters about KRY and GRZ, says that the Vennies are going to give both sites to the Ruskies,but markets are not responding in kind , GRZ up 3 to 4 cents, KRY down 3 to 4 cents on the two markets, tried calling Richard Marshall to get is take on the situation but no luck getting through and i dont think that i will be able to, the only thing i can come up with is yesterdays release on their website stating that they have not heard anything official yet from the Ven. gov. Since you stated in the past that you have done business there, correct me if im wrong on that,would the Ven. government actually do business in this manner.

any takers on GS at 80 and chg or are we waiting for 70s...

bsi,
Are you suggesting that US markets might rise at the close in harmony with Asia and Europe?

WC,

I'm observing heavy selling has occurred in the first 30 minutes in Hang Seng/UK and then it tailed off in the last hour.

Back in business with G.TO

GS Nov max pain down to 80.

I am also noticing a potential inverse head and shoulders forming for SOL. But we would need to climb back up to the $9 neckline and show heavier volume to break through $9. otherwise i would look to sell at $9.

http://i37.tinypic.com/dm5tvn.jpg

Ofcourse i can be trapped at $4 in a couple hours too with my luck!

Please do your own research.

KRY, etc. - I think talking to Richard Marshall of KRY is a waste of time. GRZ is up because they hold the concession to Las Brisas and have valuable physical assets on the ground in VZ. Their concession will likely be bought out by Rusoro.

KRY is a mere production contractor to CVG (VZ gov't mining company), which holds the concession for Las Cristinas. So, the CVG has merely to cancel KRY's contract.

Then, Rusoro proposes to contribute GRZ's concession to their JV with CVG, in return for CVG contributing their Las Cristinas concession.

Once this happens, bingo, an instant "senior producer" with 35-55M oz. in the ground, wherein Rusoro is protected by being the 49% partner to VZ gov't. (VZ has said that the new mining law will feature 49% JV's with private miners.)

There's a risk of Rusoro "going Kremlin" at some point, but with Goldfields as a 36% owner, I'll hope they can protect general shareholder interests (instead of doing an inside deal and letting Rusoro assets disappear Kremlin-style into the hands of oligarch).

Risky, sure. But what a cool story is unfolding! DYODD. Disclosure: I own Rusoro.

NYUgrad
re:SOL
How did you arrive at your 6.13 retracement? According to the Google chart a high was 8.97 on Nov 4th ..so subtracting .382 (x 8.97) from that gives me a possible retracement price of $5.54.
I'm interested in purchasing this stock and I use fib multipliers to give me a heads-up for both buying and selling. You're much more knowledgeable than I am so I was just wondering if I was doing something wrong.

I'm not anticipating a positive close at this point.

HeyMrBill,

#1 I am not more knowledgeable than you. If i were i would have sold close to $9 when Stock/RSI was telling me to.

#2 http://i33.tinypic.com/b55qwo.jpg. I did this prior to the hard hit down to $6 and was calculating retracement on the move up to $9.

Please dont buy based on my shaky research and best of luck

I just noticed that my bid for June 09 SLW 2.50 calls was accepted at $1.80. I will lose money on that trade if SLW will be below $4.30 in June AND if it won't rise above $6 at any time before June (if I see it above $6, then my calls will probably double in value, so I'll just take my profits early). I think it is a pretty good deal.

Not sure I see the point of buying options for $1.80 when you can just own the stock outright at $3 and change, but to each his own...

US News & World Report - Putting Odds on Obama’s Treasury Secretary Candidates.

Top 2 in list:
Timothy Geithner (odds: 2 to 1)
Lawrence Summers (odds: 5 to 2)

This link lists others, pros/cons of each...

http://tinyurl.com/5983cu

Reuters on KRY, GRZ, and Rusoro

http://tinyurl.com/5jo5nn

Events are moving quickly!

Question:.. Bills rsi vs Korvus rsi which is better to use when tracking a stock.

Regarding RSI...Bill uses rsi 7,14,21

I believe Korvus uses different rsi parameters what are they??? and why are his different than Bills???

Plea to President Obama: NO more "Government Sachs" geniuses, please!

Note about SLW: last time SLV was at $10, SLW was at around $4.60 (now it is at $3.75). I would like to repeat that during the earnings call on Monday, the SLW management said that they will meet all their debt payments unless silver drops to $7 and stays there until mid-2009. If that doesn't happen, and SLW weathers this crisis, then its doubling of the silver output in 2010 (which they will still be getting at $3.90/oz) should do miracles for SLW shares.

David:

The market can stay irrational longer than I can stay sober...er...solvent..yeah...solvent!

Bill -
RE: Yesterday's Daily Report

"The results, within our managed risk strategy, were: PBR +27.7%, SU +1,550%, GG +3,200%, BHP +139%, RIO >+3,700%, TCK +88%, RIMM -12.84%, and GOOG >+200%. The Google option spread was put on for 1 dollar credit and gained by 2.10 in price.

Not bad! "

Was RIMM your only loss? Could you post some of your other past losses? Not only would it be a valuable learning tool but also offer a balanced view of your overall performance.

Thanks,

[Bill Cara note:

I will go one better. Since I am doing a report on GG for publishing this weekend, I am preparing notes on how we use option strategies to work with various scenarios so that we can best manage risk. That could be a learning experience. But there are two situations I want to avoid: (i) I don't have the time to turn this free blog into a time drain on my team or myself, so what I publish and a few follow ups only is what it will be, and (ii) I will avoid getting into actual trades because I have no intention of becoming accountable to the public at large. In that regard, we are responsible for overall performance for our clients, and we will employ strategies and tactics that are too complex at times to have to stop to explain. I am a firm believer that performance plus risk measurement monitoring is all that matters to the client and general information and education is all I can give on a continuing basis to the general public... I'll get the options material done and posted today, but I have calls to take and make right now.]

nemo: if you don't take a risk, you will not get a return. I think the risk-return profile of purchasing long-dated SLW 2.50 options now is more favorable than any other opportunities that I see around now. This may change tomorrow, however.

David...well aware of your performance (hearty congratulations) and I agree w/you. I should have put a smiley at the end, but I figured the repartee about sobriety/solvency would give it away..:)

if sol gets taken down again i will be buying more near today's lows.

I'm thinking this commodity weakness will extend to tomorrow morning and then see a reversal like we did today.

So, I'll plan on keeping my GG puts until the AM and then selling and switching into some calls.

The SLW calls look good too. I'll likely get some of them in the AM as well.

Rob.

I thinkk goldbugs point was, you buy the option for $1.80, but then contend with loss from volatility decline and time premium. Ignoring those, if you buy the share for 3.50, and in June sell for 10, you made $6.50.

At the same time if you buy the 2.50 option for 1.80, by june you're option would be worth 7.50, no? Time premium and volatility premium gone. So profit is 7.50-1.80 = $5.70

Believe me, I could be totally wrong on how i worked this out. Can anybody else correct me?

Thanks Bill. If some of those relatively sophisticated strategies have names, but a Cara accent, we can always research them in their generic form.

Was just pointing out that he (David) could own the stock for less than $2 more than the price of the option; buy the stock, you can hold it 10 years; buy the option, you really own nothing but a right to buy it between now and June 09.

If SLW does indeed rise between now and June - it doesn't matter, he'll make money either way. But why rent, at that price, when you can easily own?

Good luck with it David, however you play it.

During the Nixon and Ford administrations gold increased over 200% and peaked at $600, then fell back to $500 just prior to Carter's term. By Carter's term end, gold rose to peak at $1600, then steadily declined through Regan, Bush and Clinton's terms to around $390.

Knowing recent performance through GW's term, which looks quite similar to the Nixon/Ford era....(i.e. a 2x increase) and considering objects may be closer than they appear, as bsi87 wisely points out, might history repeat?

John E,

The 1970 Terkel interview was with Congressman C.Wright Patman, of Texas, Chairman of the House Banking and Currency Committee. General Smedley Butler (Medal of Honor) was who they picked to be their leader. The General had other ideas and appparently blew the whistle on them. A subsequent Congressional investiigation, according to Butler. was a cover up.

I plan to read the book about this from amazon.com — "The Plot to Seize the White House," by Jules Archer.

Patman began this part of his interview with this sentence...

"We have two Governments in Washington: one run by the elected people—which is a minor part—and one run by the moneyed interests, which control everything."

Sounds a lot like the present to me.

Chickenpooks, gold peaked in Jan 1980 at around $875 and quickly dropped below $800 in the ensuing trading days. Are you adjusting that $875 number for the past 28 yrs inflation? If so, it would equate to roughly $2300 or so in today's dollars.

And there's an aberration in silver these days. Most sites I look at are charging 60-70% over spot ($10) even if you order 500 or so (talking Maple Leafs or US Eagles). I've been buying silver since 2003, and the premium (in the past) was usually around 16-17% over spot.

Stink bids on Deutsche Bank and Mosaic Corp - won't get there today, but maybe tomorrow.

goldbug58 - This info came from gold world and is inflation adjusted according to their chart title:

http://www.goldworld.com/articles/gold-politics-obama/328

C'mon Pookie - Gold World?

SU getting close to an entry for a quick swing trade. For some odd reason, also eyeing C and BAC at these levels. No positions.

goldbug:

Saw news item today. Forgot the Potash Consortium name, but Japan agreed to a 3 fold increase in Potash contract pricing. Mosaic part of consortium.

KRY:
It is interesting that Reuters comments that the LC goldmine will go to Rusoro yet Dow Jones Newswires say today Sans denied the report and says in his own words that Venezuela is not considering a Rusoro JV at LC.

Nemo, I'd love to buy MOS again in mid-high 20s.

No Monkey today.......

KRY:RML; LC Goldmine
A hot potato just prior to a big election at the end of the month in Venezuela. KRY still has no government information that has changed KRY's position as per R. Marchall this afternoon.

The other day I was curious to see what the price of gold would be if I tried to price a 1913 $20 gold piece using the CPI.

Using the government CPI, it is about $420.
Using shadowstats CPI, it is about $1200.

I found it interesting that the market puts the value of gold somewhere in the middle. It doesn't quite believe shadowstats, but it certainly doesn't believe the government either.

It also gives me a sense that, absent some crazy events taking place, we should be wary of expecting gold to go much past $1200.

closed all short ETF positions.

Nibbled on some BGU,TNA,GSP.

goldbug:

That makes three of us.

also took some KWT

Grymn - I thought you would mention Prescott Bush, just Google the name.

Here is a brief: "Document uncovers details of a planned coup in the USA in 1933 by a group of right-wing American businessmen.
The coup was aimed at toppling President Franklin D Roosevelt with the help of half-a-million war veterans. The plotters, who were alleged to involve some of the most famous families in America, (owners of Heinz, Birds Eye, Goodtea, Maxwell Hse & George Bush’s Grandfather, Prescott) believed that their country should adopt the policies of Hitler and Mussolini to beat the great depression."

davefairtex:

Perhaps it's not that it doesn't believe Shadowstats, but that it's discounting the likelihood of confiscation.

maybe i'm crazy, but i held on to my put position in LVS. it expires in 2 weeks...

nemo

The consortium name is canpotex

potash...mosiac...agrium

Anyone betting this is a setup for a retest of 10/27? 8175.77

Yep, Gold World. Okay, so maybe they don't know how to adjust for inflation? I won't argue that one, and the scenario may perhaps be a stretch because the current environment isn't precisely the same, but perhaps conceivable???

SV:

Dankeschoen.

i wonder how much of golds weakness today was due to crude taking a big hit to $60...

is crude and commodities still pulling gold back?

can we finally prove once and for all the baseless claims made by gold pundits that high crude costs were what was holding back the miners?

remember as we near the bottom again that the more times a bottom is tested the weaker it gets. i'm not saying the ST bottom will break, but it's certainly worth mentioning.

Chickenpookie - we had gold at $1K back in March, and I was one who believed it had a chance to go higher. Didn't believe the inflation numbers back then (and they were excluding the cost of fuel//energy, which is complete BS, but anyway).

Democratic inflationary spiral is not inconceivable, but just as we had a prevous generation that guarded against a depression, we have similar believers that guard against (the equally destructive power) of inflation.

Then there are the "gold cartel" theorists at lemetropolecafe.com and elsewhere that think there's a conspiracy to artificially hold down the price of gold.

Personally - I just dont know anymore.

dr.cosa - Dec Brent Cruded eod 57.87 I think it will go lower.

proudPapa wrote: "if you buy the share for 3.50, and in June sell for 10, you made $6.50. At the same time if you buy the 2.50 option for 1.80, by june you're option would be worth 7.50, no? Time premium and volatility premium gone. So profit is 7.50-1.80 = $5.70."

proudPapa, don't forget that if SLW shares rise from $3.50 to $10, then it would make a gain of 185% (which is not bad by itself), but if my option rises from $1.80 to $7.50, then it would be a gain of 316%. If I am shooting for a fixed $$ gain, then I can invest twice less money into the call options and still get the same absolute profit. Since I am short on cash now, I am trying to find strategies that require the smallest possible investment while still keeping the risk relatively low.

goldbug58 -- that was the answer to your question as well. If I had a lot of cash on hand now, then I would allocate most of it to SLW shares and only a little to SLW calls. Since I already have a lot of SLW shares (purchased at high prices, unfortunately), I decided to "diversify" my risk-return profile with some call options.

goldie - True gold did spike last march to over $1000 if you weren't blinking, I know, because I watched as it happened and then heard about it the next day.

Only time will tell us when time decides, you and I will either be gone to the wind or not. I missed the 70's op and the march op, and so determined not to miss the next op should one materialize. If a mess like we're in now doesn't do it, I don't know what else will.

Life sucks, then you're rich!

I'm with you David, and realize that SLW is a popular issue here; for what its worth, I'm seeing a very wide trading range in the market that's not likely to change soon, and there's better fish to fry at the moment while we wait for some clarity to return. So I'm holding a lot of cash, looking for the daily bargain to cross my trading screen. I think if you're patient, SLW is a good holding - its just not performing in the short term. Best of luck with it.

Another solar company reported after close today, SOLR.

http://tinyurl.com/6hh58e
Highlights:
-- Revenue of $140 million, up 71% year-over-year
-- Backlog grows to $1.4 billion with new customer and installed base expansion
-- Gross margin of 43.8%; operating margin at 31%
* zero debt, 112M in cash.

The above numbers do not happen if business is going bad. it is only a matter of time before this sector is recognized again. It has one of the fastest expanding growth rates of any right now. These are not phantom revenues. You can also check out FSLR's recent earnings results and outlook, as they remain the bellwether.

But i guess we are all swimming upstream right now.

No position in SOLR.

Pookie, I've been trying to escape the rat-race for the past 20 years or so, and I'm still a thousandaire and not a millionaire so I don't expect to reach my goal (hell, may not even be able to reitre in 10 years like I want to).

Just trying to build some value for my kids, give em' a better start than I got.

dr.cosa - USD was on another tear today, it seems the stars are not yet aligned. Just don't blink, my friend.

Well heck, in that case go buy a boat and teach em' to water ski. If that's already done with, take delivery and put in a safe spot until someday when they hear about a spike they can run down and cash out to Amero's or whatever.

Lots of options... gotta pair em' down by priority.

Posted by JohnE: "Anyone betting this is a setup for a retest of 10/27? 8175.77"

I don't know, JohnE. But if we do see an up day before or at the previous lows, that would indicate a higher low (or a double bottom, if we actually hit the previous lows), in which case a medium-term rally could be certified with a reasonably high probability. So instead of catching falling knives now, I'll just wait until an up day to start buying.

David,

Doh!! forgot to take my calculations one step further, and then yes, the options give a better % return.

I suppose to get the same % return with options as with the stock you only need SLW to get to about $5.85, and if it happens sooner, you get some time premium back, so same return could be at lower share price...

I think :)

BMD in receivership.

Shark, you were correct, sir.

I figured the bondholders would end up with that mine. Guess the new management was a day late. And the oil price ain't helping any, either.

Posted by proudPapa: "I suppose to get the same % return with options as with the stock you only need SLW to get to about $5.85, and if it happens sooner, you get some time premium back, so same return could be at lower share price..."

If SLW rises in price, then the percentage return on the call option (that is cheaper than stock) will always be greater than on the stock itself, assuming the volatility premium stays constant.

However, it is possible for the stock to go up in price and for the call option to go down in price IF the perceived volatility drops -- this is something one should not forget when buying call options. I am not very experienced with call options, but what I did notice so far is that the volatility premium on the call options is VERY high when the stock is falling like a knife.

If we are going to retest the lows I would rather see this low exceed the last to set up a true double bottom.

I'm pretty sure that the best double bottoms have the second leg lower than the first to shake out any more weak holders and allow for a real advance.

I still have my GG puts that are currently up about 35% since yesterday. I plan to sell tomorrow before the dollar starts weakening.

I like to buy options to gain more leverage with risking less capital. But i do understand it's more risky because of the time factor involved.

To buy 1000 GG shares yesterday would have cost me $23K. 10 calls at 20 strike for Jan only cost $2.3K yesterday. Today they closed at $3.1K

The next thing I have to get better at is selling my losing options quicker before they lose too much value. If I could perfect that part of my trading I'd really be kicking butt.

Rob.

Sorry,
I meant "10 puts at 20 strike for Jan only cost $2.3K yesterday"

And I also understand how volatility can cut deep if it drops and you're still out of the money.

That's why when volatility is very high I buy the options closer to or in the money to reduce the amount of premium I'm paying.

I also buy at least three months out no matter how much I'm sure the trade will be a winner.

Rob.

Here's what Greenspan was saying back in 2001, a comedy of errors in progress, or was it?:

http://tinyurl.com/57eurg

Posted by Finger Lakes: "That's why when volatility is very high I buy the options closer to or in the money to reduce the amount of premium I'm paying. I also buy at least three months out no matter how much I'm sure the trade will be a winner."

That's a good advice, Rob! Thanks!

When oil rose to $130 and I felt that this price is just unsustainable, I bought some one-month puts on it, which expired worthless because oil stayed above $130 for longer than 1 month. Had I bought 6-month puts at that point, I would have been much richer now. :) So I do agree that buying 1-month options is very risky, since the market can remain irrational for longer than nemo (or I) can remain sober. :)

chickenpookie:

i just blinked and spot gold is down to $726,
USD rising.

TA doesnt work in the last while for gold and USD.

gold is looking weak technically anyways, and the shares... well we all know how the shares are looking. what we need is another gold pundit telling us to WATCH OUT for the imminent price explosion in the POG and that its our last chance to load up.

ill be loading up at $660 if things fall from here. pre-market open price spikes have usually resulted in price dumps during the session. im at the point where the overnight action means nothing to me beacuse of the london market dumps that always take over. perhaps that will be a sign of a real trend-change in gold: overnight gains holding and building through the morning, with a follow through on the shares.

until then, its bearish unfortunately imho.

experts got their backs covered either way, if gold continues to go down they can simply claim its temporary deflation and a temporary bear market rally in the USD. i wonder how long it can go up before its no longer a bear market rally and hyper inflation in the form of $1200 gold is no longer just around the corner.

dr.cosa - You of course have been watching TCK and the other metal men, right? Bill is the only one who has this line in all of the market that publishes truth rather than fiction. I believe in economics 101, or at least it makes sense, but I can't help wondering if that isn't simply HB&B programming.

Anyway, keeping my eyes open to the POG possibilities as long as the "crisis" exists, learning is also a theme. Inflation ain't here yet but I believe it'll arrive eventually unless these bozo's actually do know what their doing.

Don't know how to position myself for a deflationary environment except hold shorts and whichever currency is the chosen beneficiary... I'm imagining shooting at moving targets where POG is now out of range but makes the finest of meals.

USD reversal is coming sooner or later and my shotgun will be loaded for the main event.

The next thing I have to get better at is selling my losing options quicker before they lose too much value. If I could perfect that part of my trading I'd really be kicking butt.
===============
Fingerlakes,
This is the tough part, protecting the profits & cutting the losses. My AMZN puts have gone in and out of profits atleast a couple of times in this up/down market swing. With this level of volatility, everything changes in seconds. I just keep my sizes small, so that even a complete position loss doesnt bite me so much

Arnold is trying to get a handle on California's gigantic deficit. Part of the proposal is a "temporary" 1.5% increase in the sales tax. Various groups have responded, some positively and some to cite how it would negatively affect their business, but one struck me as...I don't know...whining? I mean when compared to eating, healthcare, keeping vital services running, etc. it seems petty. You decide.

"It is patently unfair to single out California's golfers, who already pay a fair share of taxes, and expect them to assume a disproportionate share of the revenue needed to close the state's budget deficit. With courses suffering and golfers staying at home while the economy flounders, this is exactly the wrong time to deal a major blow to an industry that plays such an important role in California's economy."—Bob Bouchier, executive director of the California Alliance for Golf."

LOL! You're killing me Bob.

dr.cosa - One more thought, Maybe the POG "experts" overlooked the possibility of deflation because it almost never happens on the scale we're witnessing. We're now in a dangerous deflation overshoot which I have no idea of how long will last, but there's liable to be a dramatic swing back to inflationary which might (operative word) spike POG. It will occur when we least expect, and those who blink will be left out in the cold waiting a couple years for inflation to fill their pillowcases with Halloween candy.

Chickenpookie: Your post of 6:44 pm (link to Greenspan testimony) was a classic. It seems just like yesterday that the politicians were worried about budget surpluses spiralling out of control. They got that threat under control in short order.

The part of the article I enjoyed most was:
"Testifying before the Senate Budget Committee, Greenspan said rapidly expanding federal surpluses, which by one estimate will total $5 trillion over the next 10 years, offer ample room both to provide tax relief and to eliminate more than $3 trillion in national debt held by the public."

On the same theme, here's an article from Business Week from July, 2001:
"Nobody is predicting a rerun of the deficits of the '80s. The total surplus for fiscal year 2001--which ends Sept. 30--may still top $175 billion."
http://tinyurl.com/6z26x3

Bill - "they put their pants on same as us"

I'm thinking they actually wear their pants backwards from the rest of us.

Freedom - Yea, their mops were just soaking wet mopping up all that money until a couple weeks ago... Too bad our roads, bridges, schools, airports, (attach extensive list here) are still in total disrepair.

And now we're in a deflationary period, it appears to me, (which is supposed to be a sign of danger) and looks pretty ugly if I may say so from my perspective. They'll have to snap it back to inflationary at some point unless they've engineered some new type of reverse financial mechanism I'm unaware of.

"When oil rose to $130 and I felt that this price is just unsustainable, I bought some one-month puts on it, which expired worthless because oil stayed above $130 for longer than 1 month. Had I bought 6-month puts at that point, I would have been much richer now. :)"

David-

if I put that comment together with QT's observations about his holdings in QID/SKF/FXP (and i could in fact substitute any of our names) + years of reading Hulbert's market timing newsletter performance data, it really underscores the near impossibility of consistently calling short term market moves...

how many traders last July were able to see oil at 60 within 3 months? how many were able to see FXP at 180 last May (when it dropped below 60)?

many traders were in fact able to talk about these possibilities, but then the bottom line is how many put money on it? if they put money on it (let's use FXP), how many were still holding on the one (and only) day it hit 180? IMO, it would have been almost impossible sell at 180, as it would have required watching an 80% move over 4 days of highly volatile price movements and doing nothing...

so it appears that the kind of gains QT might have cashed in on would have required superhuman faith in the positions (or alternatively, complete inattention-> but that's not really an option, as FXP only hit 180 once)...maximum frustration, false breakouts either way and violent shakeouts are inevitable- you have to mentally tie yourself to the mast to survive long stretches of hope-busting price movements and/or the temptation to get out at minor gains and/or shakeouts that pretty much convince you you've ----ed up big time...

i went long at DJIA 10800 and it's not been much fun...even the thought that being long is 'safer' than being short loses its sheen when I look at the 20-year chart of the N225...so I'm putting a lot of faith into contrarian thinking: (a) there is no question people are bailing, which means not bailing is the option with better odds, (b) there is no way to reliably time the market in the ST-> the only way to capture a spike in prices is to be in, (c) constant reminders that maximum frustration means I'm on the right path...(isn't it funny that putting up with c--- like that in any other pursuit would mean I'm sick, whereas in trading [and maybe in certain religions], it provides comfort?) LOL

which takes me back to the question I asked shark last night: how many traders make enough to retire?

India gold futures DEFAULT

http://sify.com/finance/fullstory.php?id=14791549

...snip
The settlement price on expiry of the contract was Rs 9,622 for 8 gm (including the making charges of Rs 200 for 10 gm). Open interest on the expiry date was 11,839 coins, of which 10,908 coins (about 92 per cent) went into delivery, while the others were cash settled with a penalty imposed on the seller for failing on contractual obligation.
...snip

COMEX soon?

David,
I did the same thing with DUG and it reversed right after expiration.

I already had the rule at that point that 3 months out was the minimum but broke my rules and bought current month, thinking it was a sure thing.

When I go back and analyze my losses, most of them are from breaking my rules.

The rule I break the most is not cutting my losses. The next rule I break most often is gambling in current month options. The next rule I break too often is gambling on earnings.

This year I've been much more disciplined than before and I thank Bill for teaching me much of that.

I still have work to do in holding to my rules and maintaining discipline but I'm making great progress.

Rob.

Vadym,

I would love to hear your musings regarding "pattern breakouts" (like cup and handles) vs Bill's "simple" RSI system (which I think we all realize is a fine system, but not necessarily the one system Cara traders - exclusively - employ). Specifically, I have found that stocks that are experiencing breakouts from such patterns are invariably at high RSI levels (often around 70 on the 7-D timeframe). Is it simply a matter that only a day-trader can trade these patterns in such markets (i.e. Bear) or are there often stocks that exhibit these patterns, even at low RSI levels? As a, primarily, non day-trader, I just don't see this often.

Shiva,
That's good advice. Spreading my capital around to more positions may be a good idea instead of loading up on a couple of positions.

I'm still kicking myself for not buying puts on SSO, QLD, and DDM on Tuesday. I had the orders all lined up but didn't execute because I was sure there would be an initial rally after the Election and wanted to buy the puts after that.

Loading up on positions and waiting for the top are signs of me trying to hit home runs instead of singles. Another of my rules I need to constantly be vigilant about.

Rob.

Why gold is not rising.
We're going thru a whale of a recession. This is deflation, would be a luxury to worry about inflation. Commodity boom was a function of credit boom. We're witnessing massive deleveraging in private sector, public sector concurrently leveraging up. There's not enough money to go around! China doesn't have it. The American/European consumer doesn't have it. (Worse consumer recession since WW2) There will be continued disgorging of all commodity inventories. Demand down while inventories still rising. Not good for prices. Oil could go to $40 temporarily. Same goes for precious metals.
Banks are bust. Can't earn their cost of capital (10% or more)if they are dependent on wholesale market for capital. Only those banks that have a depositor base will thrive. (Small regional) JPM has largest derivitive exposure. Deutsche almost as bad. No transparency, no way of knowing how these banks earn their money. Worse in Europe. These large banks are essentially in liquidation. Even the healthy ones won't ever earn again what they did before.

Companies with solid cash flow and balance sheet strength will survive this. Those that don't have may perish or be swallowed, (or bailed out)
Where to hide? Tobacco and Liquor stocks, healthcare, MCard Visa, media (who is going to not pay their cable bill?)
More dividend and distribution cuts coming.
A lot of this baked into prices but is the cake still in the oven?
Food for thought.

Venezuela would be an interesting study on how much political turmoil a society and it people can endure,with the lower price of oil we may see a repeat of the 1980's
Skylane

thrifty - I just read last night how India physical gold trade was down because buyers were suspicious of the market.

still think 10000 is the stronger magnet, but there is no doubt i'm tired of saying it...although it may be more likely to happen now that i'm tired of saying it...

btw, one way to keep one eye on the market w/o getting sucked into every twist and turn is to channel your frustrations in another direction- there's probably enough energy there to overcome any inertia on any number of projects...

"thrifty - I just read last night how India physical gold trade was down because buyers were suspicious of the market."

I take that back, now I remember it was an article several years old.

RE: India GOLD Default

If they ran out of coins and had to pay penalties for defaulting this month, I doubt the shorts will be as willing to go short next month. They'd have to get more coins somewhere, or risk paying the penalty again.

Fingerlakes,
Interesting you mentioned SSO, QLD, DDM. Dont remember if it was you or bsi who suggested it but i went ahead and bought them yday open. I was kind of worried that the bid/ask spread was $1 difference but played out well. Hoping to sell it out 2morrow. I also bought VMW puts, hoping it would retrace back to 22 or so

Options.

I also try to go at least three months out. One factor that I don't know what to make of has to do with open interest on a given strike price. Some of the underlyings I've traded on recently, like March calls on GLD and XLE, will have almost no open interest on some strike prices, then a huge number on one price. One example is the 100 call for GLD. On the one hand I'm reluctuant to buy a call on a strike price that seems too illiquid, but on the other I'm afaid something like the 100 call might be held by very few hands, and thus easily stampeded out.

Guess the bottom line is that with some of these underlyings if you go three months out you're dealing with illiqudity and thus it's hard to exit on will.

http://tiny.cc/GjgwJ

Hedge fund selling puts new stress on mkt.

From WSJ`

Fingerlakes, David
One more point to watch out is historic vs implied volatility, never buy calls/puts when the volatility is high, it just kills you when the volatility is taken out. I have also watched one more thing, buying deep in the money can be really painful if the trend turns against you. I tend to stick to slightly out of the money options 3 to 6 months out. But I do some TA before deciding to go long or short. Still a lot to learn but so far working out okay. Options is a professionals market, its a tougher game than stocks.... Have you also noticed one more thing - if you buy say Mar 09 options just one day before Nov08 options expiration date, check your position on monday, it wud have gone down even if the stock hasnt moved (I would think their interest factor for time out is calculated on a daily basis but they still take a further cut on every months options expiration)

gold support appears to be at 728 as I look at it. I thought it would hold above a few weeks ago,just before the drop to 681 but so far it has been hanging onto this area well on a close basis.Spot price is 5 or 6 $ higher than the contract price per what stockcharts shows in this chart I believe?
Still hangin in by my nails,a special thanks to the person who recoed a link for me a week or two ago to look at.Seeing a trustee was a big help and a second one was even better.There are many important things they can tell anyone whom is in financial trouble and learning the ins and outs before tshtf is a must I suppose.An important bit of advice has potential to provide me with an alternative I was not aware of.

anyways fwiw gold may hold above this level?

http://xs433.xs.to/xs433/08454/tttt964.png

If it does the moners(miners I mean) sure don't seem to be aware of it.

Also, regarding the Precious metals.

Wonder if today's action can be partly explained as thus:

the Bank of England suprised the markets mightily by cutting rates 1.5. This made all the market movers worried that the world economy was in worse shape than they thot, prompting the sell the euro and flee to the dollar action we've seen over the last few months.

Didn't the Euro touch 1.30 yesterday? Today it's said hello again to 1.26. That's huge volatility. Maybe that's why gold is still in a downdraft. But. . . what's quite interesting to me, tho I don't know what to make of it, is that the gold silver ratio has been dropping, from 85 to 71ish, last I checked. Silver finally dived at the close of trading and in afterhours, but it was curious how high it has held in the last few days.

Tbar- good to see you hung in there...

Rob,
Earnings - one play that has worked for me is if the market is bullish & stock is strong (good results expected) I buy the calls 3 to 4 weeks before earnings & sell it right before the earnings (i guess it benefits from the buy the rumour & volatility increase) But now all those ideas will be out for a long time

2nd
at this point I am more of a gambler than investor it seems. I thought fundamentals were in favour for the miners holding their ground.Really all I have ever been is an investor. Now I am trying to day trade my way back and hoping that a couple of explorers I have will find a discovery next door to gea's discovery that goldcorp bought out this summer. If they do I may be saved for good lol

thanks it has been a rough 2 weeks and more

Tbar- the mutual fund industry likes to denigrate the "gambling" mentality, which would be appropriate if the industry operated as advertised...but it doesn't, so as soon as you leave the 'safety' of cash, you're gambling...buying on weakness and selling on strength does not necessarily put the odds in your favor, but it does weaken the house odds...

Yes I have to do more of that and did so today as one of the ones I mentioned filled a gap today with a 19% drop.But then I bought yri.to 2 days ago and should not have(thinking it was breaking out of an ihs on the 60m chart.) The weakness today would have eliminated some risk but then I thought their earnings report would have held them up better? From the march high to the very low was a 78% drop I think,then they report 401% profit growth at these levels and they keep falling? Thats why I am not much of a trader yet.

..put another way, the average buy-and-hold 401(k) portfolio is down 40% from the peak...the average buy-and-hold China portfolio is down 70% from the peak...those are not the kind of numbers associated with (well)-"managed" portfolios...

i don't know that you need to go to the extreme of day trading...maybe holding your current positions (having bought on weakness) is all you need to do...

Trading to "win" back losses is a tough road. Clouds decision making. Hope isn't a trading strategy either.

GL.

day trading is only done with the small amount I have left in one account. One stock at a time that is highly liquid is what I am trying. So far I have compounded some gains in the last week but I need to be much more disciplined and carefull/afraid of losing. My rrsp's as the trustee said are my food and clothes money, protected by the system for that reason so I will only trade it as things get overbought etc and hope to grow it enough to pay off debts and make things good again.I am a cornered animal at this point trying to keep things in context.Maybe things are leveling out.

That 1000 point loss since Tuesday really took a numbing bite out of my port, I new that was a good day to sell but who new the BOE would blow us all out of the water like that...

Expect the unexpected!

Henry Paulson out jogging
US Treasury Secretary Henry M. Paulson was out jogging in Central Park, New York. All of a sudden a man with a ski mask jumped out from behind some bushes with a gun.
The masked man said, "Give me all your money!"
Unwilling to do so, Paulson said, "You can't do this, I'm the Treasury Secretary!"
The man then replied, "In that case, give me MY money!"

All sports stadiums in USA currently named for banks, insurance companies, or financial institutions will have to be renamed "Federal Reserve Park" according to a decree issued today by Ben Bernanke.

Wall Street vs. Olympics
Q: What is the one thing Wall Street and the Olympics have in common?
A: Synchronized diving!

Quote of the day from a trader

"This is worse than a divorce. I've lost half my net worth and I still have a wife."

Sorry, I couldn't resist

Tbar,

Hope you're doing better. I think Gold 1982 & Gold 2008 are apples and oranges and comparing is just telling a story... but it is a story that many others tell so perhaps it will be self-fulfilling?

With the addition of ETFs, Washington Agreement, hedge funds, et al, I think things have changed a lot. $872 1982 Gold isn't the same today. When one of the largest holders of Gold (GLD) was just a speck in somebody's eye 5 years ago...

I wouldn't be surprised if we hit 2005/2006 levels again. $580 gold wasn't that long ago.... and neither was the "reasonable" price of oil under $50.

So when Gold hits $1000 & Oil hits $140 there's doom & gloom, and when Gold hits $600 & Oil hits $50 there's doom & gloom. Where's the happy medium?

Lots of support for oil in the $45 - $50 range so probably we muddle through until the regime change in the new year.

http://www.backwardsbush.com/

Japan's Nikkei plummets early Friday
http://tinyurl.com/5qxztl

ABK pulling a dead cat bounce tomorrow? I think we broke through the last low for GM & F. Almost 30% more shares traded than average for F.

Buy F or SLW tomorrow?

Ford and General Motors expect losses to be in billions
http://tinyurl.com/6625tj

I would sell the rumor & buy this news.

"Administration speeding up rather than slowing down on efforts to get bailout fund launched"

"Workers worry as Ford, GM expected to cut jobs when 3Q results are announced on Friday"

Never mind guys, GM just went under! Only a Domino effect of around 1 million jobs, I would guess. Nice try but it wasn't enough anyway...

I think I didn't sell Tuesday because Bill sounded so dire... Had made a subconscious decision to delay action when he puts forth ideas rather then jump like a wildcat. Besides, I thought those rate cuts were already factored in.

Intrinsa - Wonder if this might reverse this traders hair loss I'm experiencing.

Pretty solid reversal off the morning lows in Asia. ^HSI is going green after opening considerably down. Nikkei clawing back towards even......

re: Far East

Yup, u gotta sell or buy 'em when u can, not when u want to.

guys we have seen gold do this many many times before.

it thrusts upward quickly, then begins to slide down. it bases after the market close into the overnight, has a few runs up before smack down hard in the morning. everytime i see a basing patten following a hard fall i get nervous.

i hope im wrong but i still have some cash to employ so i no mind if we see $690 which will happen in short order should the current level not hold. lets hope the pattern begins to break.........

Shiva,
Nice execution buying those puts on SSO, QLD, and DDM.

If we get much closer to the lows, I'll be looking at the calls.

If volatility suddenly falls any out of the money options will immediately lose premium. That's what makes buying options in this environment so rewarding and risky at the same time. Where else can you get a 50% return in one day only risking 1 or 2K?

It would be a good time to be selling options as Bill describes but I'm not willing to put that much money in my trading account at this point. Once our house is paid off(which will be soon) I'll be more likely to commit more capital to the market and start using more complex option strategies.

I've done that earnings play you talk about quite a few times successfully in normal markets. Where I get in trouble is by convincing myself I'm right and holding through earnings instead of dumping before.

Rob.

any volunteers to look at this chart and tell me:
http://i38.tinypic.com/344wkfq.jpg

A) i am correct in spotting an inverse head and shoulder possibly forming. but as usual too early.

B) No way, i am smoking marijuana and completely off base.

C) Yes its probably a head and shoulders and yes that is typically a bullish signal if it crosses up thru the neckline on heavy volume, but in this crappy market its not going to work.

D) other

Thanks in advance!

I should just buy POT and sit on it until April. You know damn well there'll be huge requirements for fertilizer come spring when all the farmers will receive emergency Federal aid to buy fuel, fertilizer, and seed to grow and feed the homeless, jobless and starving.

When in doubt, choose C. I do like the multiple choice testing format.

Chicken,
I hear you. On Tuesday my retirement accounts were down 10%. Now they're down 20% again. So much for the election bounce.

But my gains in the trading account have been helping erase the retirement account losses.

I just have to keep my eye on the ball and stick to a disciplined approach with my finger on the button and another eye on government actions with an ear listening for impending financial failures and the other ear listening for geopolitical events.

It used to be impossible for me but now it's becoming almost automatic. If the market ever becomes normal again I'll have to learn how to trade all over again.

Rob.

gold - The sooner we give up, the sooner it'll shoot the moon.

So true. If GG hits 25 by April, I'll be in good shape. If it hits 35 by then I'll be huge.

For now though I'm positioned for it to fall to 19. I'm hoping we see that tomorrow and then I'll close out my puts and then wait to buy calls on SSO, QLD, and DDM.

I'm also closely watching SLW and am thinking about 500 shares if it drops under 3 tomorrow. If I do get the shares I'll sell calls on the first up-day to reduce my cost.

They'll never make me give up. I'll just keep switching sides.

Rob.

Rob - If I start trading now, by the time I learn how the market will have recovered and my account would be down 20%, representative of the effort put forth.

Seriously though. all I need to do is sell a few things at say, Dow 9500 and buy them back at 8X00 levels once, maybe twice, and I would be a very happy camper. It takes courage, which I'm working on.

Rob,
I even tried straddles holding them through the results, never made money on those, at the max i hold 1 or 2 contracts through results if i want to satisfy my fancy beliefs....

Out of money vs In the money. I will never put up the same money as i would put up for buying the same stock (meaning if i buy 100 shares for $5k, i would never buy 10 or 20 calls instead totalling to $5k on the same, i would restrict my position to $500 or $1000 on that common). That being the case, there is not much of leverage with In the money options, also the downside risk of trend reversal can bite you. So i stick to close to money options. Example: I bought ITM Apple 160 Jan calls @8 each when the stock hit 106, completely misread the market & chart. Dow tanked to 7700 & aapl to 85, now with volatility also reduced, option is worth a few pennies. I dont seem to have good luck with deep ITM options yet.

Still learning, one day hope to be much better..... Complex strategies need constant attention & tuning, I work full time, so cant hope to do it from work.

DEflation anyone?

Mackinaw,

there are really a few questions in your post from 9 pm. Let me try and break it down so they don't mix and cloud the picture.

First, about "pattern breakouts (like cup and handles) vs "simple" RSI system". See, it's not "vs". As Bill says, there is time for everything. Any chart pattern and any indicator is nothing more than a certain measurement of players' psychology. Let's see what they indicate in different cases. Many indicators, for instance stochastic, show a buy signal in oversold zone and sell in overbought zone, by definition measuring a behaviour pattern in a ranging market; only in a range stocks perfectly bounce from 0-20 and drop from 80-100. Now, breakout (again by definition) constitutes rather trending market since it's a pattern of breaking the range. When you observe how stochastic acts in a trending market, you will see very different picture: it spends some time in overbought zone and then gets even, umm, overboughtER (sorry, I have to maintain my reputation of a worst speller/typist). BTW, it's very interesting to go over psychology of specific chart patterns, like that same C&H, but I digress, it's a separate topic. Important point here is, different types of oppatterns belong to different markets: range vs uptrend vs donwtrend. When evaluating partciular pattern or indicator, pay attention to a general state of the market we operate in. Wrong market can either kill the right poattern or mute its effect. Let me show you almost real time example: UAUA formed beautiful C&H on daily chart with rim at 16 and broke it couple days ago. If we had a nice uptrending market, such powerful break could easily skyrocket the stock a few points. Instead, all it could do was about 50 cents, then fizzle out.

Second, there is a question of a matching timeframe. Since you mention 7-D and day traders, I am not sure it's apples and apples. You need to make sure patterns and indicators you compare are in the same time frame. Is C&H formed on the same chart on which RSI is measured? Sorry if it sounds too obvious but I do see traders mixing timeframe they read and timeframe they act in. Believe it or not, but once I saw a trader who bought intraday ascending triangle breakout, 5 minutes chart... and held a stock 8 months later at a huge loss. OK, that's extreme example, but on a lesser scale it happens often.

Third, you say "in such markets (i.e. Bear)" but I am not sure which market we are in at this point in the timeframe you are using. One thing that distorts a lot of traditional ways of reading right now is extreme volatility. When we lose 000 points in one day, gain 1000 in another, lose 500 in third, what market is it right now?? :)

Finally, let's throw the first two together. There are different markets in different timeframes. A lot of bull markets can happen "within" bear market, as we witnessed over last, umm, half year at least. An up day may be merely a little bounce on a daily bearish chart, but it's a bull market for a day trader. An upward week is merely a bounce on a monthly bearish chart but it's a bull market for a short term swing trader; etc. Now you see how I have difficulty answering this part: "Is it simply a matter that only a day-trader can trade these patterns in such markets (i.e. Bear) or are there often stocks that exhibit these patterns, even at low RSI levels?" There is a contradiction in this question; quality breakout pattern and low RSI are not likely to to be observed within the same timeframe. Align all the elements of your read, and you will usually see them lining up nicely. Then use several timeframes to build your trade: trading idea from larger timeframe, fine-tuning entry using lower one...

Hope it helps and not confuses more :)

Disclaimer: all mistypes in the above are left untouched on account of my wife promising that I won't live to see tomorrow if I do not leave my computer right now.

re:SOL

d)

Nov max pain 7.5, Dec 5.0
50 DEMA 9.64. Lotta resistance and drag IMO.

10 day ATR is 1.2. Using 1.5 day X 1.2=1.8

Today's price is 6.39. If it hits the stop, you have a 28% loss. Most traders can't take many 28% losers and stay in the game. I try to look at issues trading at 10 bucks or greater and preferably 15 and volume of 100K or better for liquidity.

full disclosure: long KWT.

NYU,
It has traded in the lower half of the bollinger bands for a while and broken through the middle band now. Check if it holds 6.08, if not it might trace back to 4.33. On the weekly chart, MACD histogram is bullish. Just my 2 cents.

Rob,
My appl calls were OOM. Actually i had goog calls which i bought slightly ITM ( 1 contract at $30 something) but it went downunder very fast when the stock went down fast.

Vad,

Good summary. Elder uses a Triple Time frame. He suggests using one time frame above the one u trade in, the time frame u trade in, and the shortest time frame for entry/exit. Weeks/days/hours or Days/hours/minutes. All using a 26 period Exponential moving average.

Correction. 26 period to determine trend, then a 50/200 period in the middle time frame, and just MACD divergences in the lowest time frame.

Did everyone around here bail on UXG?

It cratered to 38 cents but bounced to around 70 cents. I have been pointing out that the price action recently suggested a move and sure enough yesterday (Thursday) of all days it went for a moon shot, touching $1.30 before closing at an even buck.

I have been selling into strength on the way up but still have some more to trade away. I am finally in the green again on this stock after having been down more than 50%.

Looks like also a second chance to pile into TCK. Those Dec 10 puts touched 2.25 yesterday. May go instead for
the Dec 7.50 puts.

ALOHA !!

Two Donald Trump quotes:

- Nobody but a total masochist wants to be criticized.

- "This seems like out and out socialism, but I really like it?"

Thanks Vadym,

Considering how poorly formulated my question was, you did an amazing job dechipering it and your first paragraph, in fact, addressed the issues I was most concerned about.

ALOHA !!

On Oct 6th the POG was right at $900USD and today it is around $730USD. That is a decline of $170USD or down 18.9%.

Now lets look what happened to the GLD gold bar inventory held in the GLD vault that is managed by JP Morgan. On the same day the POG was at $900USD the total gold tonnes held by GLD was 745.22. On Nov 5 when the POG had lost some 18% the GLD gold tonnes was 749.21, a gain of 3.99, nearly 4 tonnes!

So even though the GLD price dropped from 90 to 72 the amount of gold tonnes went up not down the opposite of their business model.

THERE WAS NO SELLING OF GOLD BY GLD ON A POG DROP OF 18.9%!! NONE ... IN FACT GLD BOUGHT 4 TONNES!

Here is my hypothesis. While JP Morgan controls around 70% of all gold derivatives on the COMEX JP Morgan also controls the GLD gold.

ANYONE HERE GET A CLUE YET? CAN ANYONE HERE CONNECT THE DOTS YET?

Dr. Cosa ... Why isn't GLD selling like all the other dolts who buy into the DEFALTION effect on the POG bull? Why did GLD buy 4 tonnes during this POG 18.9% decline?

The HUGE COMEX Dec contracts are a possible destination for GLD held gold tonnes to cover deliveries in the event there is a shortfall in COMEX inventories, which there will be. A force majeure would mean that the COMEX would force settlement in US Pesos.

DUH-H-H???

If you buy GLD you are only buying time, but most important you are buying worthless paper backed by JP Morgan, not gold! The supply issue will break the GLD back. GLD is a fraud! Its a gold version of musical chairs and JP Morgan owns the chairs! BUYER BEWARE!!!

kaimu,

i always enjoy your posts, and would never assume to know more about gold than you.

in my humble opinion of 4 years spent studying everything possible about gold i can say this:

ive never seen credible evidence that the GLD's tonnage has anything to do with its price, its movement, volume or state of physical gold supply.

GLD tonnage is to me the equivilant of those phrases people make that are never proven true but always heeded by traders like: end of month portfolio rebalancing, tax-loss selling, buy when it snows-sell when it goes..... nothing has ever been shown to support that the GLD adding tonnage during a price decline actually means anything considering the prices are down both for hte GLD and for the COMEX.

calling for a default on the COMEX is like calling for the big quake to hit vancouver, everyone has heard its a possibility but odds are very very very much against your call, and youd go brok constantly making that bet till it happens.

i hope you are right, but i just dont see any credible evidence of a correlation b/w tonnage and anything, but im open to examine the issue closer if such a relationship does in fact exist.

So if GLD's a fraud, (and USO for that matter) will a selloff affect the physical gold price some more?

Many ETFs are just derivatives (weapons of mass destruction?) with a better name.

If you sell the paper and buy the physical, will the price go up or down? My guess is down due to increased leverage and liquidity with the paper...

So what's your March target price on $GOLD?

Good morning.

Here are your Cara 100 Ratings Changes:

Upgrades:

ABX - to Outperform @ RBC
SLW - to Outperform @ RBC
WFMI - to Equal-Weight @ Barclays

Price Target Lowered:

DIS - from $30 to $28 @ Oppenheimer

Wavesmash:

Maybe not. Physical price has already diverged from paper price. Go back to what Kaimu has said about confidence. It will be one more financial product gone awry. I think it would drive people to gold and away from the market. The price of physical would likely increase.

I wonder how making investment choices in government bonds, large cap companies will be affected by the following list of derivatives exposure:

http://www.dtcc.com/products/derivserv/data_table_i.php?id=table6

Notable is that Barrick is exposed to $10b. of derivatives contracts, and Teck has a pile as well. It would be easy to assume that major mining corporations deal in the futures contracts of the commodities they produce, and that these two examples are just barely scratching the surface of how they both affect prices and supply in the various markets.

Now and futures.com compiled a list of the top 50 contract holders. The total list and notional amounts of exposure are probably in the area of only 10% of the total derivatives 'out there' and the DTCC knows it. No information is available on how government bonds, which are now under the exclusive patronage of Wall St. brokerages, were/are being used to lever up and parry against the oil trade.

http://www.nowandfutures.com/d2/Top50_CDS_Gross_notional20081031.htm

There is also limited access to how much the derivatives trade is tied to foreign exchange, especially since the collapse of the Power Reverse Dual Currency Notes in Japan. All you see is the collapse and the unwind, but have no way to estimate the exposure in the markets to these kinds of contracts.

Will world economy growth outpace the current recession?

Interesting world gold production cycle.

http://www.dani2989.com/gold/productiondorcyclesgb26072004.htm

This manipulation of the gold price is like clockwork regardless of loss of production or any f.a. It just isnt normal for prices to rise around the world for anything and then summarily get beaten to death as it enters north america.

http://www.kitco.com/charts/popup/au24hr3day.html