Bill Cara’s Blog for Jan 6, 2012

CTA Trading Desk Morning Report

[7:45am ET] Good morning, Geoff here.

The last two days we have seen gold rally along with the dollar. What does that tell us?

It could be saying that gold strength is signaling an impending bottom in the euro and a top in the dollar. If that turns out to be the case, then gold and stocks should breakout to new highs as the dollar rolls over.

So, how does this fit into my recent morning notes? Well, I have been stating that we have been bullish stocks and remain long. But, we also feel that various sectors of the market are overbought (see Bill’s latest WIR) so taking some money off the table and/or hedging your current holdings is a prudent action.

I also have stated that a high profile economic data point, like the employment number this morning, can be a trend changer. The number could be positive and the market could rally for a short time and then get sold off as traders “sell the news”.

That is two completely different scenarios, so what is a trader to do?

Well, we added some hedges to our portfolio and we will simply manage those hedges based on how prices act today. If the market rallies, we will take the hedges off and be really long again. If the market falls, we will add to the hedges. In other words, you need to have a plan for both scenarios and trade according to price action. I will add one thing; most of our trades today may not be executed until the last hour of trade.

With that said, it is always fun to take a guess at what is going to happen, but that is all it is – a guess. My guess is that the dollar will top soon because the sentiment in the dollar is extremely bullish. No one wants to hold the euro right now and that extreme sentiment could really hurt the dollar bulls should the dollar turn down. If that occurs, there indeed will be a major trend change on the employment number, only it will be the dollar that changes trend and the stock market will do what it has done so often before – get even more overbought.

Well, enough with the speculating, time to watch the action.

Have a great trading day!

[8:35am ET] Addendum:

The employment numbers were released at an add of 200,000 which exceeded expectations of 150,000. The Unemployment rate dropped to 8.5% which beat expectations of 8.7%.

Stock futures rallied a few points after the positive data was released but the “rally” isn’t blowing my hair back at this point which could point to a weak day ahead. I will check in later in the Mid Day report.


Here are the 7:00am ET snapshots of the latest equity market trading results for Europe, and futures prices plus 5-minute charts of the futures for S&P 500, 30-year US Treasury Bond, US Dollar index, Gold and Crude Oil.

Symbol Name Last Trade Change Related Info
^ATX ATX 1,910.00 Jan 5 Down 35.00 (1.80%) Components, Chart, More
^BFX BEL-20 2,116.10 6:59AM EST Up 19.20 (0.92%) Components, Chart, More
^FCHI CAC 40 3,170.91 6:59AM EST Up 26.00 (0.83%) Components, Chart, More
^GDAXI DAX 6,111.36 6:44AM EST Up 15.37 (0.25%) Components, Chart, More
^AEX AEX General 312.05 6:44AM EST Up 0.13 (0.04%) Components, Chart, More
^OSEAX OSE All Share 450.47 6:44AM EST Down 0.61 (0.14%) Components, Chart, More
^OMXSPI Stockholm General 313.12 Jan 5 0.00 (0.00%) Components, Chart, More
^SSMI Swiss Market 6,028.15 6:44AM EST Up 1.58 (0.03%) Components, Chart, More
^FTSE FTSE 100 5,649.78 6:44AM EST Up 25.52 (0.45%) Components, Chart, More
FPXAA.PR PX Index 901.00 6:59AM EST Down 0.80 (0.09%) Chart, More
ESI500000000.MA IGBM 836.32 6:40AM EST Up 3.87 (0.46%) Components, Chart, More
MICEXINDEXCF.ME MICEX Index 1,439.47 7:45AM EST Up 0.14 (0.01%) Chart, More
GD.AT Athex Composite Share Price Index 647.58 Jan 5 Down 14.71 (2.22%) Chart, More

http://finviz.com/futures.ashx

http://finviz.com/fut_chart.ashx?p=m5&t=ES

http://finviz.com/fut_chart.ashx?p=m5&t=ZB

http://finviz.com/fut_chart.ashx?p=m5&t=DX

http://finviz.com/fut_chart.ashx?p=m5&t=GC

http://finviz.com/fut_chart.ashx?p=m5&t=SI

http://finviz.com/fut_chart.ashx?p=m5&t=CL

The team will check in during the day, reporting in the Discourse when there is a new entry.

Enjoy your day.


Cara on Trends & Cycles


Vad’s Catch of the Day


Kaimu’s Sound Money


CTA Trading Desk Mid-Day Report


CTA Trading Desk Post-Close Report


Jeff Borsato’s Hidden Truth

To build on what Bill has said this morning about gold and the USD, I wanted to repost prior thoughts about the gold/USD relationship that is not always a correlation, several years on we see gold and the USD in exactly the inverse positions on the charts, but how they arrived is vastly different.

Previous thoughts on Gold vs USD, nothing has changed imho

November 7, 2011 posting on Gold vs. USD

Interesting Times

Gold is up, USD is up, this could be the norm going forward should the crisis in Europe continue. The rush to US dollars is nothing new, it happens when crisis appears on the horizon. How gold reacts to market crisis is somewhat more ambiguous, market collapses have witness gold following suit at times, where other price drops have seen gold stand firm.

We have seen the relationship between a strong dollar and weaker gold fall by the wayside over the past few years. While the chart shows gold starting at bottom left and the USD at the top right, and 5 years on they reverse that position, notice the total lack of correlation. This is significant. To me it is a sign of more complicated times ahead for traders stuck in a USD down= GOLD up mindset.

sc.png

The relationship of gold to the miners broke many years ago, I do not believe this will ever return to historical norms unless gold hits the stratosphere, the broad markets are not collapsing and oil stays low. Until then it’s all about picking your spots in the sector.

Good luck gang,

Jeff Borsato
jeffborsato@caratrading.com


Attachment Size
sc.png 38.14 KB
  1. [No set time] Monster Employment Index 8:30 AM ET... [#103234]
    By: davefairtex (5215 comments) Go to top ↑
    • [No set time] Monster Employment Index
    • 8:30 AM ET Employment Situation
    • 3:00 PM ET Treasury STRIPS
  2. Accumulation Zone: Monthly 0, Weekly 0, Daily... [#103235]
    By: davefairtex (5215 comments) Go to top ↑

    Accumulation Zone: Monthly 0, Weekly 0, Daily 0
    Distribution Zone: Monthly 0, Weekly 0, Daily 0

  3. CONSUMER CONFIDENCE EMU for Dec Actual: -21.1 Cons.: -21.2... [#103236]
    By: Les (7233 comments) Go to top ↑

    CONSUMER CONFIDENCE EMU for Dec
    Actual: -21.1 Cons.: -21.2 Previous: -20.7 Revised from -20.7

    RETAIL SALES (YOY) EMU for Nov
    Actual: -2.5% Cons.: -0.9% Previous: -0.7% Revised from -0.4%

    UNEMPLOYMENT RATE EMU for Nov
    Actual: 10.3% Cons.: 10.3% Previous: 10.3%

    FACTORY ORDERS N.S.A. (YOY) Germany for Nov
    Actual: -4.3% Cons.: -1.2% Previous: 5.2% Revised from 2.0%

    NET CHANGE IN EMPLOYMENT Canada for Dec
    Actual: 17.5K Cons.: 15.0K Previous: -18.6K

    UNEMPLOYMENT RATE Canada for Dec
    Actual: 7.5% Cons.: 7.4% Previous: 7.4%

    http://www.fx360.com/calendar/

  4. ... [#103237]
    By: Les (7233 comments) Go to top ↑
  5. NONFARM PAYROLLS for Dec Actual: 200K Cons.: 150K... [#103238]
    By: Les (7233 comments) Go to top ↑

    NONFARM PAYROLLS for Dec
    Actual: 200K Cons.: 150K Previous: 100K Revised from 120K

    UNEMPLOYMENT RATE for Dec
    Actual: 8.5% Cons.: 8.7% Previous: 8.7% Revised from 8.6%

    AVERAGE HOURLY EARNINGS (MOM) for Dec
    Actual: 0.2% Cons.: 0.2% Previous: 0.0% Revised from -0.1%

    AVERAGE WEEKLY HOURS for Dec
    Actual: 34.4 Cons.: 34.3 Previous: 34.3

    http://www.fx360.com/calendar/

  6. see attached. Italian bank down 10% at one stage, now up... [#103239]
    By: Les (7233 comments) Go to top ↑

    see attached. Italian bank down 10% at one stage, now up 3%. Something to watch.

    edit: volatility extreme – from +4% to -1% in minutes for Unicredit. Nuts to this.

  7. you wrote: "Conflicting signals abound, every week in this... [#103242]
    By: jack black (2306 comments) Go to top ↑

    you wrote:

    “Conflicting signals abound, every week in this market. That Russell’s Dow Theory letter is judged in top place as a market timer on a risk adjusted basis is worthy of respect and acknowledgement, especially by the layman. Given that we’re here to think these market thoughts collectively it arguably doesn’t serve us to write someone ‘up’ as a guru or ‘off’ as a failure. What can they add to the collective knowledge of this blog?”

    Since the shot was at me, let me respond.
    The “top place as a market timer” medal comes from Mark Hulbert. But he himself wrote this in 2008:

    “Paying attention to Russell nevertheless baffles many, who find the day-to-day musings on his Website to be often inconsistent, if not outright contradictory. But just as a Freudian analyst can eventually find coherence in the free-associated ramblings of a client, devoted Russell followers claim they are able to make sense of what he writes.
    Russell himself acknowledged that earlier this week in response to a subscriber who complained that Russell’s musings were “all Greek” to him and that he “didn’t understand” what Russell was trying to say.
    Russell’s response: “I don’t expect a new subscriber to take it all in and understand it all on the first reading or even in the first few months of readings. The stock market and its ‘language’ is a 60-year learning experience for me, and how in the world can anyone absorb it all in one or 10 or 20 readings … [New subscribers need to] have patience, to read the sites and ‘work on it’ for three or four months or preferably for a year, and by that time a lot of what I’m writing and a lot of chart-reading should make sense.”
    Though I have been reading Russell’s writings for more than 28 years, I must confess that I still have trouble integrating all of what Russell says into a coherent narrative. But, as best as I can interpret, Russell recently turned bearish on the stock market’s long-term trend.”

    I never personally subscribed to Russell’s newsletters, but sounds like they contain the Oracle of Delphi style with the legendary Oracular doublespeak that you can interpret both ways later to fit the reality.

    According to wiki, there was only one scientific study on Dow Theory back in early 20th century and it failed.

    For what I know, Russell was super bullish in mid 2007 when smart money were selling like crazy only to turn bearish later in 2008 (duh!) in a way that even Hulbert had difficulty deciphering. The same happened in 2011 and now.

    The main point of this is discussing it is very important here, so novice investors would not be fooled by people who use a colorful language and claim to predict future. I’ve been one of those novice investors who believed in “gurus” at some point and paid for that dearly financially and emotionally. My recent successes merely recovered my previous losses.

  8. yet PM and miners holding well (slightly up). Bonds... [#103244]
    By: jack black (2306 comments) Go to top ↑

    yet PM and miners holding well (slightly up). Bonds neutral. Looks bullish to me for PM, even though it’s not exactly risk off.

    • Next euro support looks to be around 126 or so. We're still... [#103245]
      By: davefairtex (5215 comments) Go to top ↑

      Next euro support looks to be around 126 or so. We’re still a ways away from that. Gold is up in spite of this, which is a hopeful sign.

  9. Good morning. 08;30 Nonfarm Payrolls (200K) 08:30... [#103243]
    By: Bull Hunter (3552 comments) Go to top ↑

    Good morning.

    08;30 Nonfarm Payrolls (200K)
    08:30 Unemployment Rate (8.5%)
    08:30 Hourly Earnings (0.2%)
    08:30 Average Workweek (34.4)

    ——

    BMY – Bristol-Myers upgraded to Outperform from Underperform at CLSA based on expectations for a positive Q4 driven by strong IMS volume and expectations for a strong 2012 product story. Price target raised to $38 from $35.

    INTC – Intel downgraded to Neutral from Buy at Sterne Agee citing checks that indicate PC OEMs are increasing mix to ARM PC platforms from x86, emerging market growth could move to WARM solutions, and they do not expect its move into Smartphone-Medfield to be material enough.

    JCP – Macquarie juices its JCP recommendation to Outperform from Neutral.

    KSS – Kohl’s downgraded to Hold from Buy at Argus based on continued sales weakness following weak November comps.

    SCHW – Charles Schwab downgraded to Hold from Buy at Deutsche Bank citing a challenging environment for online brokers. The firm lowered its price target for shares to $13 from $14.

    SNDK – SanDisk upgraded to Buy from Neutral at Sterne Agee citing valuation that reflects negative handset sentiment and Europe, and expectations for margin upside from a flat/lower yen, lower Fab5 Startup costs, and lower non Captive mix. Price target is $57.

    ——

    “Gold would have value if for no other reason than that it enables a citizen to fashion his financial escape from the state.”

    William F. Rickenbacker

  10. ... [#103246]
    By: Bill Cara (4105 comments) Go to top ↑
    • Here's a signal. Financials, even though they still contain... [#103283]
      By: 4ever (612 comments) Go to top ↑

      Here’s a signal. Financials, even though they still contain significant “assets of mysterious value”, are beginning to increase in price.
      Who has said on several occasions that financials will lead the way higher? With real negative interest rates, funds will begin to look at equities and make the shift from bonds. This is the year.

      Performance from investertech.com — 1 week / 2 week in %:

      XLF 2.49 4.73
      JPM 5.8 9.41
      WFC 4.25 7.62
      BAC 13.19 18.16
      C 6.69 9.39

      I’m not saying buy financials, although it might work out great. I am saying good quality stocks, like those in the CARA100, are about to see price improvements as our economic and confidence levels improve in 2012.

      Happy hunting.

  11. Morgan Stanley has been circulating a note, "Not so... [#103247]
    By: GW (400 comments) Go to top ↑

    Morgan Stanley has been circulating a note, “Not so fast!”

    Apparently the seasonal adjustment says Morgan Stanley, produced a +42k quirk that will be given back next NFP report in February.

    “some of the strength in this report should be discounted because of an seasonal quirk in the courier category of payrolls (Fed-ex, UPS, etc). Jobs in this sector jumped 42,000 in December, repeating a pattern seen in 2009 and 2010 (see attached figure). We should see a payback in next month’s report.”

    His note was accompanied by a chart showing the seasonal oddity, that seems to be what has caused the initial excitement to wane, that along with the fact that the BLS has revised many components again in this report including the unemployment rate, but revisions are almost guaranteed and they are never positive.

  12. and refused to place a lower low. Patience. Looks like... [#103248]
    By: jack black (2306 comments) Go to top ↑

    and refused to place a lower low. Patience.
    Looks like miners are forming a bullish flag.

  13. APA - target lowered at Oppenheimer. Shares of APA now seen... [#103249]
    By: Bull Hunter (3552 comments) Go to top ↑

    APA – target lowered at Oppenheimer. Shares of APA now seen reaching $120, Oppenheimer said. Share declines greater than group. Outperfrom rating.

    DIS – estimates increased at BMO through 2013, BMO Capital said. Cable networks can drive growth and the company is cutting costs. Outperform rating and $48 price target.

    KSS – numbers lowered at Jefferies. Shares of KSS now seen reaching $47, Jefferies said. Estimates also lowered on January is expected to also be soft. Hold rating.

    TGT – numbers lowered at Jefferies. Shares of TGT now seen reaching $48, Jefferies said. Estimates also lowered on muted promotional efforts. Hold rating.

  14. I have been reading the comments from the last few days... [#103250]
    By: pulse (324 comments) Go to top ↑

    I have been reading the comments from the last few days from the Cara community with disbelief. Everyone is wrong – often.

    Presumably, most of us are here to decipher the price signals we perceive as significant. Yet, most of us recognize these signals are foggy, not clear. The attempts to separate savers from their surplus will continue, we can be certain of that.

    We are living in the most extraordinary of times. We can help each other or attack – this is our choice. It would be helpful to explain why one disagrees with various sentiments, rather than harshly dismissing public declarations of belief merely because the author has been wrong in the past.

    Exponential debt escalation has been our ‘growth model’ for decades. When will this peak? When will governments live within their means? When will people engage in productive criticism? When will we stop stealing from the future?

    Personally, I see no end in sight to this generation’s worship of ‘something for nothing’ and ‘risk free’ rent seeking. I can not know how far up on the exponential curve of quickening we are – I can only know that it WILL collapse, as all things which approach ‘infinite’ must.

    Mr. Cara’s time tested methods of persistent devotion to cycle awareness and price trading are a great gift to those who wish to really learn. When he first declared ‘Where’s the fire?’ this rattled my notions of the moment – so I studied. When the Euro banksters have been bailed (the TBTF will be – come hell or high water) quantitative easing will relax. When they are printing, they will be lying. Bill has written of this process at length. Other writers I respect make bold, unhedged and public declarations as well. They are also wrong, frequently. We can only try to be less wrong and more right.

    It is very easy to tear things apart. It is very difficult to plan and build. We will be wrong, and we are all stronger with help from others.

    Please be respectful – our pursuit of happiness requires kindness to grow….exponentially.

    pulse

  15. Ditto for equity and silver. Gold slightly above, but... [#103251]
    By: jack black (2306 comments) Go to top ↑

    Ditto for equity and silver. Gold slightly above, but miners below.
    So much for buy and hold, LOL.

  16. ... [#103253]
    By: Vadym Graifer (4341 comments) Go to top ↑
  17. ... [#103254]
    By: jock (1011 comments) Go to top ↑
    • Thanks for sharing this one Jock. Browsing their website... [#103271]
      By: westcoaster (1130 comments) Go to top ↑

      Thanks for sharing this one Jock. Browsing their website, (take a look people)I see the Yukon is beckoning young men to chase dreams once again. Having been up there recently, I observed that the territory is experiencing a revival as Gen Y’s and Millennials are moving in, working thru the cloud, and grokking the outdoors. Interesting place. I can see these principals becoming a lot richer in 10 years than those who hang around HB&B. Add in the winters in Mexico, and what a great lifestyle. The stock has fallen in half this year, like many others.

      • Westcoaster, Th Yukon will get into your blood and is a... [#103276]
        By: Spyder (43 comments) Go to top ↑

        Westcoaster,
        Th Yukon will get into your blood and is a place you will want to see again. It is now is now home of the White Gold area where a number of stocks mentioned on this site find their home. The Yukon has always been a land of promise, starting with the Gold Rush in 1896 when a city of about 50,000 was in place at Dawson City. I have been up there 3 times starting with a geological mapping party working for the Geologic Survy of Canada while a University geology student in 1965. If you have seen Dawson City on Google Earth, it is worth a look. The mining at the time of gold discovery was all placer mining. To the east of Dawson City (about 4 miles) you can see the tailings piles left from the activity of the dredges as they mined the creeks. This is a site you will not forget.

        When I was up there in 1965 our group befriended an old sourdough miner who was working some of his claims with a gold pan. We would give him some food and supplies (as things were not as easily available as they are now). Whenever I asked him how things were going, I always received the same answer – something to the effect that it was really terrible, the worst he had ever seen. However he always managed to spend 6 months over the winter in Florida. Not bad considering that the price of gold at the time was only $35.

  18. ... [#103256]
    By: JimG (299 comments) Go to top ↑
    • Interesting! Been looking at so many different wave counts... [#103258]
      By: GW (400 comments) Go to top ↑

      Interesting! Been looking at so many different wave counts over the past few months. Truly amazing how subjective EW really is. There are so many different counts out there.
      I saw this once which really sums it up. “If you are lost in the desert with no cell phone. Just scribble out an Elliot Wave count in the sand and within 60sec someone will come along to revise it.”

  19. ShadowStats.com points to sharp increase in seasonal... [#103257]
    By: Vadym Graifer (4341 comments) Go to top ↑

    ShadowStats.com points to sharp increase in seasonal “courier and messenger” employment increase (+42K) as part of today’s jobs report

    - Citing BLS stating: “Employment in transportation and warehousing rose sharply in December (+50,000). Almost all of the gain occurred in the couriers and messengers industry (+42,000); seasonal hiring was particularly strong in December.”
    - Says January data consistently shows a reversal in the seasonal pattern of December courier hiring; BLS expects a similar trend to occur this year.

  20. ... [#103259]
    By: jock (1011 comments) Go to top ↑
  21. we are chopping around in a box on ES all week. 1260-83... [#103261]
    By: NYUGrad (4750 comments) Go to top ↑

    we are chopping around in a box on ES all week. 1260-83 area. No real edges so no trading for me.

    there are some divergences in various indices.

    1270-73 will act as a magnet until a breakout from the box area mentioned.

    How long can euro disengage from equity prices? We almost saw 1.25 area reached.

    • NYU, what you encounter is one of the downsides to trading... [#103262]
      By: Vadym Graifer (4341 comments) Go to top ↑

      NYU,

      what you encounter is one of the downsides to trading futs vs equities. Index is locked in a narrow range – you have nothing to trade. In equities world, something will move independently, still giving you an opportunity. 6 for 6 today, to add real life to theory…

    • NYUGrad - "How long can euro disengage from equity... [#103264]
      By: davefairtex (5215 comments) Go to top ↑

      NYUGrad – “How long can euro disengage from equity prices?”

      Look at the daily SPY:FXE chart. The SPY has disengaged from the euro since it double-bottomed in mid August. Looks like the US market is very strong in euro terms. RSI is getting a little high though…

  22. inspired by Vad's Catch of the day and following his... [#103265]
    By: Bear E (287 comments) Go to top ↑

    inspired by Vad’s Catch of the day and following his method… see attached chart of my catch.
    Thank you Vad!
    Bear E

  23. Not liking what I see here. Covered some Naked puts here... [#103266]
    By: 14them34me (295 comments) Go to top ↑

    Not liking what I see here. Covered some Naked puts here that I sold back in December, several weeks ago, for small profits – namely, LVS, POT, TCK.

    Looking to selling more stocks as well as covering more naked puts in coming days.

  24. ... for non-Facebook... [#103269]
    By: Vadym Graifer (4341 comments) Go to top ↑
  25. I grow weary from hearing the phony monthly labor reports... [#103270]
    By: MoKat (531 comments) Go to top ↑

    I grow weary from hearing the phony monthly labor reports which are then repeated over and over by the manipulated financial press and politicians across the land. Good news.. Good News… tweet tweet. The economy is improving. Shadow stats says including those who have dropped out of the system, unemployment is 22%.

    Misch Shedlock has an in depth article on today’s unemployment data. (See it at FinancialSense.com)

    “While the “official” unemployment rate is an unacceptable 8.6%, U-6 is much higher at 15.6%. Both numbers would be way higher were it not for millions dropping out of the labor force over the past few years.

    In the last year alone, the civilian population rose by 1,695,000. Yet the labor force only rose by 274,000. Those not in the labor force rose by 1,421,000. That puts a huge damper all all reported unemployment rate statistics.

    Things are much worse than the reported numbers would have you believe. The entire economic picture is on very thin ice given the clear slowdown in the global economy.”

    If you check out Misch’s report at FSense… there also a recent Jim Puplava interview with Ann Barnhardt, the commodity broker who closed her commodity brokerage after MF Global. She is REALLY FIRED UP ! She talks about the commodity market and how our system has lost total integrity. ….. Glad she’s not my wife..Phew! LOL
    Definitely worth listening to.

    • MoKat, I read the report at Mish's website and the... [#103272]
      By: Grym (5469 comments) Go to top ↑

      MoKat,

      I read the report at Mish’s website and the Kiplinger Newsletter’s glowing report of “improvement” which may neighbor gave me this morning.

      Where I live we (Rockford, IL) are at an admitted 11% unemployment in December. According to a chart at:
      http://lmi.ides.state.il.us/download/LAUS_CURRENT_

      We are down from 13.6 in November 2011.

      This, sadly, is minus the many who have given up.

      Such doctored data are likely to get Obama another four years since the media seldom dig into the numbers.

      Grym

  26. Here's one of those chart-filled articles outlining... [#103267]
    By: Dr. Strangelove (2004 comments) Go to top ↑

    Here’s one of those chart-filled articles outlining everything you’ve ever wanted to know about gold statistics but were afraid to ask.

    http://www.numbersleuth.org/worlds-gold/

    And here’s Armstrong outlining the history of fiat currency that you won’t find in any economics or history books in college.

    http://www.inflateordie.com/files/Fiat%20Solution%

    I believe it’s important to have an historical framework to work from with my investment strategy and hope others here will benefit.

    As a bonus, how about a downloadable copy of Adam Smith’s Wealth of Nations!

    http://www2.hn.psu.edu/faculty/jmanis/adam-smith/W

    Enjoy.

  27. Who's next to gain the status and take the the financial... [#103274]
    By: Dr. Strangelove (2004 comments) Go to top ↑

    Who’s next to gain the status and take the the financial capital out of NY? It won’t be going back to London. Can you say Hong Kong or will it be Singapore? Ross Perot’s giant sucking sound …

    http://www.caseyresearch.com/gsd/sites/default/fil

    For those holding cash, Sovereign Man points out the Hong Kong checking accounts demised in HK dollars are good for both a USD inflation or deflation play since the peg will be broken in a deflation and secure in an inflation without the U.S. Treasury default risk (lions and tigers and bears, oh my!) and that, he says, Hong Kong banks are not levered like the Western banks. Perhaps a nice alternative to gold and silver.

    Anyone have experience as a U.S. expat with a Hong Kong account? davefairtex, you out there?

    Enjoy the weekend.

    • Dr. Interesting chart. Do you mean demised or denominated?... [#103275]
      By: westcoaster (1130 comments) Go to top ↑

      Dr. Interesting chart.
      Do you mean demised or denominated? I have a Cdn friend living in China who swears HK banks will protect confidentialiy. Never tested it personally

      • westcoaster - "Do you mean demised or denominated?" Not... [#103278]
        By: Dr. Strangelove (2004 comments) Go to top ↑

        westcoaster -

        “Do you mean demised or denominated?”

        Not sure what I meant but ‘denominated’ is what I wanted to say ;)

    • Dr S - I live in Bangkok. I have no experience with Hong... [#103277]
      By: davefairtex (5215 comments) Go to top ↑

      Dr S -

      I live in Bangkok. I have no experience with Hong Kong accounts.

    • Interesting chart porn. Not sure that I would agree but... [#103279]
      By: Ilya (572 comments) Go to top ↑

      Interesting chart porn. Not sure that I would agree but looking at the countries mentioned one may surmise as to the the basis for their then being considered as a reserve currency.

      Portugal: Port wine which owing to its high alcohol content was kegged and lasted for decades. Spices garnered from Macau. Port was considered and traded as money well into the eighteenth century.

      Spain: Gold, silver and other trade in new world ag products from central and south america in addition to trade with north africa.

      Netherlands: Profitable trading surpluses with Russia and a state of the art shipbuilding industry. Let’s not forget tulips and cheese!

      France: Agriculture and a historic relationship with the Vatican which was used politically to ensure a tax/tithe compliance from the gentry down to the peasant.

      Britain: The financial birthplace and overlord of western civilization’s money thought… The industrial revolution where the latent energy of water and coal was unleashed. Where the slavery of the muscle power of men was no longer necessary. FINANCE…huge joint stock companys and yes that 4 letter word DEBT. Britain, the financial mother of the U.S.

      America: The refinement of industry, technology and yes banking…Plus a military that has never lost a war. I count winning a war as forcing your opponent to eventually ‘buy in’ to your systems and money thought. Show me a country WITHOUT a borse and that will be the next one to be ‘reformed.’ Even Vietnam now has a borse.

      The reserve currency country has always had a target on his back to be supplanted by another in due course. Who cares? Funny colored Yuan notes are as bogus as Hungarian Florints. If you want a true exchange rate, figure the price of a Hungarian hog and its Chinese equivilent

      The reserve currency debate is more about what the Big Dog must pay in interest to finance the promises made to their uninformed electorate in order to maintain the power base of the twiddle dees and tweddle dums. It makes good sense for them to have a pointy headed bearded gnome nationalize the yield curve and litterly confiscate billions in interest owed to savers while smiling in the cameras about how low the CPI is fallaciously calculated.

      Stagflation! Thy name is reserve currencies everywhere, pigs included…

  28. tune in from about 20 minutes. Interest rate cycles, her... [#103280]
    By: Les (7233 comments) Go to top ↑

    tune in from about 20 minutes. Interest rate cycles, her thoughts on the gold bull market etc, quote – “gold continues while real negative interest rates exist”. Worth listening to.

    http://www.netcastdaily.com/broadcast/fsn2012-0107

  29. ... [#103281]
    By: Les (7233 comments) Go to top ↑

  30. worth a look: http://is.gd/mEELaF ------ Shows Romney's... [#103282]
    By: Bull Hunter (3552 comments) Go to top ↑

    worth a look:

    http://is.gd/mEELaF

    ——

    Shows Romney’s admiration for Bernanke and the FED.

  31. CFTC Commitment of Traders report sees EUR net shorts at... [#103286]
    By: Vadym Graifer (4341 comments) Go to top ↑

    CFTC Commitment of Traders report sees EUR net shorts at new record highs; CHF shorts and JPY longs at multi-month highs

    US Dollar Index: Specs Net: 41,837 v 42,574 prior, COT index 91.9 v 93.1 prior, Open Interest 59,687 v 61,900 prior (3-week low) – 2-week low in net longs

    Euro: Specs Net: -138,909 v -127,879 prior, COT index 0.0 v 0.0 prior, Open Interest 219,791 v 218,245 prior (multi-month high) – record high in net shorts

    British Pound: Specs Net: -31,899 v -28,992 prior, COT index 34.7 v 36.9 prior, Open Interest 87,563 v 80,282 prior (4-week high) – 3-week high in net shorts

    Swiss Franc: Specs Net: -12,355 v -10,798 prior, COT index 11.5 v 14.9 prior, Open Interest 19,929 v 18,456 prior (2-week high) – 18-month high in net shorts

    Japanese Yen: Specs Net: 56,481 v 22,585 prior, COT index 98.1 v 70.9 prior, Open Interest 89,491 v 82,797 prior (5-month high) – 5-month high in net longs

    Australian Dollar: Specs Net: 46,537 v 32,637 prior, COT index 54.8 v 40.6 prior, Open Interest 93,999 v 87,976 prior (8-week high) – 3-month high in net longs

    Canadian Dollar: Specs Net: -23,371 v -21,812 prior, COT index 3.3 v 4.8 prior, Open Interest 78,701 v 78,076 prior (3-week high) – 2-week high in net shorts

    New Zealand Dollar: Specs Net: 2,436 v 1,405 prior, COT index 28.2 v 29.2 prior, Open Interest 13,278 v 11,737 prior (3-week high) – 3-week high in net longs

    Mexican Peso: Specs Net: -25,829 v -25,685 prior, COT index 6.1 v 6.2 prior, Open Interest 69,972 v 62,141 prior (4-month high) – 4-week high in net shorts

    S&P 500: Specs Net: 11,419 v 6,862 prior, COT index 68.3 v 64.6 prior, Open Interest 54,766 v 52,344 prior (3-month high) – 3-week high in net longs

    10-yr T-note: Specs Net: +6,236 v -2,981 prior, COT index 75.5 v 73.0 prior, Open Interest 417,218 v 415,351 prior (6-week high) – 3-week high in net longs

    Vix: Specs Net: -14,076 v -10,624 prior, COT index 31.7 v 44.1 prior, Open Interest 34,804 v 33,542 prior (2-week high) – 3-month high in net shorts

    Gold: Specs Net: 130,971 v 130,788 prior, COT index 2.6 v 2.5 prior, Open Interest 207,707 v 204,038 prior (2-week high) – 2-week high in net longs

    Silver: Specs Net: 9,638 v 6,855 prior, COT index 6.2 v 0.0 prior, Open Interest 43,620 v 41,197 prior (3-month high) – 3-week high in net longs

    Copper: Specs Net: -1,548 v -3,592 prior, COT index 43.5 v 40.1 prior, Open Interest 60,806 v 60,930 prior (3-week low) – 7-week low in net shorts

    Crude Oil: Specs Net: 144,468 v 144,588 prior, COT index 54.8 v 54.9 prior, Open Interest 457,692 v 449,414 prior (3-week high) – 2-week low in net longs

    Natural Gas: Specs Net: -158,020 v -160,591 prior, COT index 69.8 v 68.1 prior, Open Interest 515,902 v 518,687 prior (6-week high) – 2-week low in net shorts

    Wheat: Specs Net: -44,093 v -44,741 prior, COT index 15.9 v 15.2 prior, Open Interest 189,969 v 193,639 prior (3-month low) – 8-week low in net shorts

    Corn: Specs Net: 190,729 v 154,807 prior, COT index 38.2 v 30.9 prior, Open Interest 426,549 v 432,655 prior (5-week low) – 6-week high in net longs

    **Relative COT index based on 3-yr lag.

  32. For the rest of you suckers, me included that subscribe to... [#103287]
    By: Ilya (572 comments) Go to top ↑

    For the rest of you suckers, me included that subscribe to Direct TV, know that today I received my bill for next month which increased in price by a modest 15.16188% from December. My trash guy has already nicked me for another 10+% for 2012.

    The purchasing power of my fuzzy looking funny colored money is depreciating by 5 to 7% or more per year while I’m blessed to receive exactly zippo% on the savings that I’ve accumulated over the past 45 years.

    I await the reduction in the cost of stamps and Sunday deliveries from the USPS as they compete on price and service with Fedex et al. I also welcome the rate reductions from Fedex………I dream!

    Inflation is going to rip your heads off!!! It is today except that our elected government officials and their appointed liers…continue to figure… Wake up. I pity the poor palukha that stashes away his matress cash only to find out that a Jackson will be needed to buy a loaf of bread.

    A silver dime which was in circulation 50 years ago will if converted to todays trash cash, almost buy you a gallon of gasoline… One hundred 20$ gold ounce coins will buy you a nicely appointed new 2400 sq ft Centex constructed home in Texas.

    Prices don’t increase, your money buys less!!!!!!!!!!!!!

    • ... [#103289]
      By: Grym (5469 comments) Go to top ↑
    • Hmm Ilya lets see if I can provide an explanation for why... [#103298]
      By: davefairtex (5215 comments) Go to top ↑

      Hmm Ilya lets see if I can provide an explanation for why some prices go up, while others go down. (I notice you didn’t mention the prices that have gone down recently in your inflation rant – curious)

      First of all, taxes are easy. Governments are receiving less income from taxes because both spending, income, and property values have deflated, so they raise them. They have what’s called “pricing power.” What are you gonna do, stop drinking water? Stop having access to the sewer? Sell that underwater house? Good luck with that.

      Oil (and related products, like food, and Fed Ex) that’s easy too. Peak Cheap Oil has come, and gone. Now instead of $1 oil in the KSA we have $40 oil in the Bakken, $60 oil in the GOM and the tar sands. Sure its nice to have it, but it is not cheap oil the way we used to have, and as cheap oil depletes and is slowly removed from the system and more expensive oil takes its place, everything that depends on oil gets slowly more expensive. Oil is up on average from $20 in 2000 to $100 today. Oil appears to be up about 20% (on average) 2011 vs 2010 and 50% vs 2009.

      It’s no surprise food has been affected.

      We’ve also had a massive amount of money printing since – well since the late 50s – based on a massive increase in (mostly) private debt. We’ve gone from 60% debt/GDP to 300% in 2008. That’s a factor of 5 increase in credit money above and beyond the GDP growth rate. Blame the Fed, or private borrowers, credit money increase caused a lot of that inflation.

      Lastly, even though we’ve had massive job losses and income reductions, any reduction in spending has been largely cushioned by government support. Areas like medical care and education continue to go up because of government support, and basic food prices also haven’t been affected because of various stabilizers like SNAP and other assistance programs continue to feed people even though they no longer have income.

      So the deflation we saw in the 30s isn’t manifesting the same way mostly because of government intervention.

      However, for those areas which still have largely free market buyers and sellers, and for which there is no major scarcity change in the raw material inputs, prices have definitely been affected. Housing for one. Labor for another. Your money buys more, not less.

      So if you factor out the government supports, and resource scarcity issues, deflation is present. You probably shouldn’t be expecting an exact replay of 1930 because the government response (and overall involvement in the economy) are dramatically different from what they were back then.

      • ALOHA!! Dave-All well and good to pick prices, but the sad... [#103306]
        By: kaimu (3289 comments) Go to top ↑

        ALOHA!!

        Dave-All well and good to pick prices, but the sad reality is that I do not need to buy a new house everyday like I need to buy a tank of gas. Also I would say the same about your “labor deflation” since if you look at bank and corporate management wages up to CEO levels we have a price spiral as well as most trade union wages. It really does not matter if you are a good CEO or even a good electrician since your performance is not based on free market labor. Once again more government price fixing. What would those bank CEO wages look like if their banks were allowed to fail? Would they even have a job?

        At any rate you have been parroting my PRICE FIXING 101 model, whereby government fills in the free market gaps. Every politician knows they would never get re-elected in a true Depression, brought on by a financial system collapse of excessive credit expansion. What we have now is pure corruption at every level in order to prevent such an event. They do not even care if 1+1=0!

        Still you should look into “confiscatory deflation”. I believe that is where we would end up here in the USA if the political and monetary elite allowed the credit expansion to collapse. To see a modern example of that go here …

        LINK: http://mises.org/daily/890

        Now go here to see how it played out for the POG …
        LINK: http://tinyurl.com/6r79rl3

        What matters is what happens to the paper currency’s value afterwards. In most such cases the paper currency is junk. Remember that almost any form of paper is simply a “promise to pay”. Such promises have never been upheld under any inflation vs deflation monetary crisis.

        Believe me I would love to see housing prices crash back down to 1970 levels and see a gallon of gas at a quarter, but what would our monetary system and our lives look like if that happened? I doubt you could even get any money out of your bank account or brokerage account in time to buy up any those hot “fire sale” deals! What good is cash if you cannot access it? Even if you did play that “deflation trade” perfectly …

        When it comes to such events all bets are off …

        Gotta go deliver flowers … Mahalo!

        • I'm well aware of the Argentine 2001 situation. Its why I... [#103310]
          By: davefairtex (5215 comments) Go to top ↑

          I’m well aware of the Argentine 2001 situation. Its why I say that bank deposits are not at all the same as cash in stacks of paper FRNs. When I talk about cash, I really do mean cash.

          There is a period of time between the impounding of bank deposits and the subsequent revaluation of the currency when paper FRNs will be extremely valuable – because there won’t be nearly enough of them. Up to you if you want to have some or not. Certainly there is little reason to have your cash in a bank deposit at the moment. You don’t get paid interest to keep it there, that’s for sure.

      • Thanks Dave, You made my case. Let's tackle housing and... [#103311]
        By: Ilya (572 comments) Go to top ↑

        Thanks Dave, You made my case.

        Let’s tackle housing and labour. Given ‘equivilent rent’ house price inflation was never captured between 2000 and 2006. I confess that during that period that quantum qualitative improvements were forced into the equation; granite counter tops, stainless steel appliances, hand scraped wood flooring etc. The term ‘McMansion’ was applied to almost anything over 4,000 sq. ft.

        Today many ‘McMansions’ can be bought for 10 or 20% under replacement cost. A bargain indeed that will not last long.

        Yes indeedy, labour has been outsourced (except for services) to our Asian brothers and with it what would have been domestic labour cost inflation except that Caesar was killed on his way to the Forum and those Asian ingrates are now demanding and receiving 10 to 20% per annum wage hikes. We exported 10 plus years of inflation and it has most assuredly circled the globe only to hit us squarely in the back of the head.

        The only deflation I have experienced is with the interest income I no longer receive on my savings. “Save and Invest. It’s the American Way!” “Borrow, spend and default” seems the better choice.

        The race to debase is only now beginning in earnest. I will no longer speak of inflation. I will only couch prices in terms that ‘I only got 3 loaves of bread for $10 this week. Rolling my bank CD will now income only enough to pay half my heating bill this winter vs. all of it last year.” Yep, this income deflation sure buys less and less when ‘they’ charge more and more.

        • Anything that has a global marketplace, increasing demand... [#103313]
          By: davefairtex (5215 comments) Go to top ↑

          Anything that has a global marketplace, increasing demand, and production scarcity can experience price increases without money printing. Oil is an example. Natural gas, on the other hand, isn’t going up. Or can you somehow make a case for natgas at $3 being some sort of inflation? How many gallon-equivalents will your silver dime buy at the (natural) gas pump? Mom has a natgas car. I think she pays under $2 per gge.

          US wheat on the other hand is definitely of interest to people outside the US. Developing world growth results in other countries buying up our wheat. They aren’t deflating, since they didn’t experience a credit market bubble. And western government support insures our people continue to eat, regardless of declining income – how many times have you yourself pointed this out? Thus, deflation doesn’t touch food prices.

          Taxes as an example of inflation? That’s exactly backwards. It is INCOME and PROPERTY that went down, so existing taxes yield less – and the state & local government can’t print, so they are trying madly to keep their slice of the pie at the expense of all the other pie-eaters. And they have “pricing power.”

          As for asian brothers – in Thailand I don’t hear about anyone getting 10% to 20% wage hikes. I see food price inflation for sure, but not wage inflation. Nor housing inflation either. And supposedly the unemployment rate is around 2%. Seems true enough, I don’t know anyone out of a job except for the new grads who are looking for that first job. And that tends to last about 2-3 months.

          And – did you really just blame the credit market bubble & pop in real estate on stainless steel appliances and granite countertops? The Fed Z1 shows that credit money in the mortgage market doubled over the bubble period, yet you want to focus on countertops? Why then did all those subprime houses spike in value too? Some strange “rising tide lifts all countertops” argument?

          Care to respond directly to any of these points? Or do you want to still just look at bread prices whose consumption is clearly supported by SNAP and kindred government programs?

          Its perfectly fine if you only want to look at half the equation and complain about “inflation.” Well its perfectly fine as long as you aren’t looking for a sound explanation for what is happening to the other half.

  33. I've brought NOTHING to the table lately. Okay, I made a... [#103290]
    By: Ron Sen (975 comments) Go to top ↑

    I’ve brought NOTHING to the table lately. Okay, I made a few bucks in the market this week, like anyone long.

    My son presents his 2012 arguments in the link. I hope it gives another rational data set. He’s understating his credit market derivatives experience, as he helped his firm make several hundred million dollars in the blowup.

    http://tinyurl.com/7fchjuw

    Agree or disagree, you can reply to him on Twitter, and he has a pretty good track record on social mood, and a network in the industry. I’ve still got nothing to bring now, unless you love basketball. http://melrosegirlsbasketball.com/blog/

    • Sorry Ron, I can't possibly reply to a blog post using 140... [#103294]
      By: davefairtex (5215 comments) Go to top ↑

      Sorry Ron, I can’t possibly reply to a blog post using 140 characters. I don’t know if I ever made a post that short! So I’ll do it here instead and you can forward if you so desire.

      Conor makes a fine case for a big US equity market move using some really interesting numbers – the equity risk premium is an especially interesting bit of analysis. As long as the current macro conditions remain in place, I think he’s got a decent case.

      What are these macro conditions?

      * 4% home mortgage rates, paid for by Fed “tax the savers” money printing
      * 10% of GDP per annum borrow & spend by the USG (USG debt from 60% to 100% of GDP in 3 short years)
      * US consumers only deleveraging slowly from an all time historical high of 280% private debt to GDP

      If mortgage rates return to more normal 6%, if the government returns to a more normal 3% annual deficit, if the Fed is unable to continue printing (Ron Paul and/or the Tea Party reins them in), or the consumers start to actually reduce debt more briskly down to more normal levels (perhaps 100%?), it all goes away.

      Without consumers increasing debt or a substantial growth in real income, spending at current rates is based on government intervention – that 10%/GDP of new government debt every year. If this can continue in perpetuity, the party will continue unabated.

      I believe the limits to that 10% annual borrowing will arrive as soon as euroland addresses their issues. And when those limits arrive, I don’t see money fleeing from US bonds to US equities, I see money fleeing from the US bond market to other places. That equity risk premium will revert back to the mean, but it won’t be because of an equity market bounce, it will be because bond prices tank and P/E ratios plummet. A bond market panic followed by a couple of quarters of austerity will do that nicely.

      However, this will only happen once Europe gets fixed.

      So yes, I think he’s right. It is based on a continuous drip of government sugar – the party comes to a brisk close as soon as the sugar feed goes away. As to when the sugar is cut off, that’s anyone’s guess. Maybe we have a year, or maybe even more. But unsustainable activities, by definition, can’t continue in perpetuity.

      I know this is the boring old pessimistic case everyone is tired of hearing about, but I just can’t help focusing on what I believe will be the impact when we start moving back to more sustainable (historical) levels in mortgage rates (6%), government deficits (3% of GDP), and private debt levels (100% of GDP). I guess they call that a “reversion to the mean” case.

      One more addendum: my understanding is that a consequential chunk of US corporate profits depend on europe and emerging markets. As such, there’s an outside chance that severe problems in europe (that roll through to the emerging markets, who sell a bunch of stuff to europe) will end up taking a decent sized chunk of US corporate profits, so we might get some equity risk premium mean reversion while the US sugar feed remains in place. But I’m less sure about that, since I don’t know the figures.

      I still like the equity risk premium analysis though.

      • thanks for answering my thoughts Dave, was similarly... [#103295]
        By: Les (7233 comments) Go to top ↑

        thanks for answering my thoughts Dave, was similarly concerned with the flip side of this case Conor put forward, as solid as it appears short-term. One author’s note of the sugar drip you remark on is as follows:

        In late 2008, the Fed had $600 billion of swaps on its balance sheet. By early 2010 they were mostly paid down as the panic of 2008 subsided and banks were able to raise capital from traditional sources, primarily by selling stock. By the end of last summer, the Fed’s swap renewal agreement had a balance of only $2.4 billion. In recent weeks, the balance has grown to $64 billion. We fully expect to see much higher numbers in the coming weeks as more dollars are channeled to Europe.

        http://www.financialsense.com/contributors/guild/2

        precedent shows $600 billion in swaps, present tab from the recent hoobla is $64 billion. That’s a lot of upside possible. Unless that half-billion the ECB lent at negative real interest rates recently was all US dollars, in which case the Fed has already shot its load. Is the Fed good for another half-billion if Euro banks are in further need?

        • Les, I hate to admit it, but I don't really understand what... [#103297]
          By: davefairtex (5215 comments) Go to top ↑

          Les, I hate to admit it, but I don’t really understand what the impact of those swaps are. What is being swapped? And is it bad?

          By the way people are talking it is dreadfully bad debt, and the Fed is swapping increased balance sheet risk (by not having sufficiently large haircuts) in exchange for truckloads of zero risk federal reserve notes. But it would be nice to have some details. Perhaps – perhaps that’s why the Fed doesn’t want to be audited. Do we have any details on what got swapped the last time around? And what the haircuts were? Or maybe that’s not what happened at all.

          I wish I knew more about what it all meant. Inflationary? Deflationary? A sign that All Is Not Well in Credit Land?

          And I’m guessing when you said the ECB lent a half billion, you meant half trillion. Or is that a european thing that billion really means trillion?

          • ... [#103312]
            By: Les (7233 comments) Go to top ↑
          • Confidence. Well definitely a hyperinflation is all about... [#103315]
            By: davefairtex (5215 comments) Go to top ↑

            Confidence. Well definitely a hyperinflation is all about confidence for sure. And if it weren’t for historically high levels of private debt, I’d worry more about people’s confidence ebbing in the currency resulting in a mad spending spree. But when your property is underwater, or your credit card debt is higher than your annual income, there is an automatic check on your willingness to go out there and spend. You can, it’s true. But few people have a hoard of dollars under their mattresses – or even in their bank accounts. Most people are deeply in debt. Private debt in the US even after all the foreclosures and bankruptcies is still at 270% of GDP. The only time it was higher was in 2008! The next highest point was in 1932 – at 240% of GDP, after GDP had dropped by 33%.

            And although private debt has fallen, the debt to equity in the property market has actually gone up – mainly because equity has taken a 33% haircut!

            If we do get into difficulty, I think it is possible (let’s say 40% chance) that a stack of FRNs will be the place to be. Not permanently, but for a time – and a long enough time to be financially “interesting.” That is if Ben cannot print. Of course, its perhaps equally possible that Ben prints madly – 10 trillion – and nobody stops him. Then gold will be the place to be. Perhaps that would be the confidence buster you are talking about. Maybe that’s a 40% likelihood too. Its why I like to diversify.

            I don’t see a hyperinflationary phase change happening in “days” its more likely weeks to months. The masses won’t all get on board in days. We will be able to see it ramping up in the movement of prices. If it happens there will be a tipping point however. It will appear to the general public as if everyone just woke up and changed their minds – but they won’t all take action immediately. There are the usual people groupings – the early adopters, etc. Furthermore, we should be able to see it coming if we are watching those prices closely. I remember reading that it was the first 50% of a hyperinflationary monetary destruction that does the real dirty work.

            I talk more about deflation here because many people seem so convinced inflation is a 100% sure thing. I feel like everyone is fighting the last war – the war that has gone on from 1933 until now. And indeed it is the long term struggle, that destruction of purchasing power. But as we know now, housing prices don’t always go up. Likewise, inflation is not always guaranteed to happen by some law of physics. For instance, I believe that housing prices WILL go up again, eventually, unless something happens to change our population equation. But not right away. They’ll stay low long enough to be financially “interesting.”

            Did you enjoy the euro testing 126.50? I think there is moderately good support there in the 125-126 range. Maybe we’ll see a bounce.

          • yeh thinking about Euro as a bear trap or otherwise now... [#103316]
            By: Les (7233 comments) Go to top ↑

            yeh thinking about Euro as a bear trap or otherwise now finding overhead resistance at previous support. Currency movements swamp equity markets for size, so we should see currencies move into an expansionary phase together if the game is on. AUD and CAD of course being the ‘real stuff’ currencies that should be bid up in an expansionary phase. As always we shall see.

            I wonder if we’re building a small inverted head and shoulders in silver futures. Horizantal neckline at $30. Should tie in with the dollar IF it rolls over.

          • Perhaps this is another case of "the eurozone didn't... [#103317]
            By: davefairtex (5215 comments) Go to top ↑

            Perhaps this is another case of “the eurozone didn’t implode this weekend” bounce. Silver currently leading gold, at least on my watchlist.

            Silver breaking above 30 – sure I can buy that H&S pattern. 30 resistance should be some work to overcome, but a rising euro might just do the trick.

            While your imagination is running, imagine what happens if Bernanke announces a 10 trillion printing operation, and everything under the sun spikes immediately, throwing the economy into recession, the dollar into the tank, and inspiring a popular outcry that leads to a Tea Party led revolt in Congress by Ron Paul which ends up revoking the Fed charter – or at the very least, limiting the Fed’s ability to print.

          • Brandt's understanding and TA interpretation of the January... [#103318]
            By: Les (7233 comments) Go to top ↑

            Brandt’s understanding and TA interpretation of the January FX effect – EUR/USD 1.08 target, FWIW: http://peterlbrandt.com/january-forex-effect-eurus

  34. Hi Jock Do you know at what price and terms the small... [#103291]
    By: mikede (121 comments) Go to top ↑

    Hi Jock
    Do you know at what price and terms the small private placement was done?
    The website only shows the April 11 private placement?
    Thanks

  35. Required by Jan 29. A friend has been principal of various... [#103292]
    By: westcoaster (1130 comments) Go to top ↑

    Required by Jan 29.
    A friend has been principal of various schools over the years offering Canadian curriculum schooling to very eager Chinese, and now Korean students.
    http://tinyurl.com/72mzd24
    “20,000 RMB/month (appx $3,000) for experienced, trained, certified Canadian teachers whose first language is English, plus transportation, modern accomodation, utilities and return airfare. Thought you might have some contacts who might be up for the adventure while providing quality service to a very small number of Korean learners in a Canadian International School. Need a grade 2/3 home room teacher (3 grade two’s and 3 grade three’s) and language arts plus an option teacher for learners age 10 to 15 (using Scholastic materials as recommended by Alberta Education).”
    Have a qualified candidate contact me by email.

  36. Since Bill's on vacation and won't be posting WIR #2, I... [#103293]
    By: Dr. Strangelove (2004 comments) Go to top ↑

    Since Bill’s on vacation and won’t be posting WIR #2, I thought I’d link Value Line’s latest Intel and Hewlett-Packard reports.

    http://www3.valueline.com/dow30/f4731.pdf

    http://www3.valueline.com/dow30/f4341.pdf

    Anyone having trouble with the RSI tool? Won’t work for me for last few days.

    Cheers

  37. Take a look at $NAMO, which I annotated to show how market... [#103296]
    By: Les (7233 comments) Go to top ↑

    Take a look at $NAMO, which I annotated to show how market breadth, when diverging from the index in a bearish manner, leads to reversal in the index shortly after.

    Took profits on UXG at 3.50, +.25. I needed the cash and UXG is my most liquid holding. UXG’s chart looks good, but if you want a multi-week/month advance one needs to see the monthly charts turn. That’ll take at least a month, if not longer. Hopefully more cash then.

    Back to passive investing and Rockefeller’s memoirs.

  38. ... [#103300]
    By: jack black (2306 comments) Go to top ↑
    • I would like to add mine. the Mayan prediction comes true... [#103301]
      By: NYUGrad (4750 comments) Go to top ↑

      I would like to add mine. the Mayan prediction comes true and we see massive global catastrophe. just kidding

      the Mayan calender ends Dec 21, 2012. (UFO noise)

    • I'm thinking the #4 prediction is a given, considering that... [#103305]
      By: jack black (2306 comments) Go to top ↑

      I’m thinking the #4 prediction is a given, considering that all HB&B are betting their money on Romney. Somehow HB&B got sour with Obama. I wonder why. I thought he delivered for HB&B for the money they gave him for the 2008 election. Maybe their demands were even greater than that? If so, that is really bad news for the 99%ers.

      BTW, this is the source of info: http://www.opensecrets.org/pres12/contriball.php?c

  39. we are slowly dripping closer to 1.25... [#103302]
    By: NYUGrad (4750 comments) Go to top ↑

    we are slowly dripping closer to 1.25 level.

  40. If the RSI tool isn't fixed soon I will have to ask for a... [#103303]
    By: bemter (3 comments) Go to top ↑

    If the RSI tool isn’t fixed soon I will have to ask for a refund of my subscription.

  41. about how the major branches of government conspired... [#103299]
    By: jack black (2306 comments) Go to top ↑

    about how the major branches of government conspired together to discredit and to try to jail a well know researcher who discovered a successful treatment for brain cancer so his patents could be stolen and sold to a pharma company. Great example of tax dollars at work. They actually partially succeeded (except for the jail part).

    As a direct consequence of their actions untold numbers of cancer patients lost their lives or were harmed.

    Anyone with cancer or cancer in family should watch it to see how the medical establishment doesn’t care about actually saving lives but rather that big pharma makes money.

    The same way HB&B owns government, the same way pharma owns medical establishment.

    The movie is deeply disturbing to me.

    The title is “Burzynski”

    Edit: it’s on youtube http://www.youtube.com/watch?v=S81PXHwjMAQ&feature

    • I dunno about how reliable that story... [#103307]
      By: Vadym Graifer (4341 comments) Go to top ↑

      I dunno about how reliable that story is…

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

      • I don't agree with everything Byrzynski does or did. If he... [#103308]
        By: jack black (2306 comments) Go to top ↑

        I don’t agree with everything Byrzynski does or did.
        If he went through official university channels, he would be very famous by now, Nobel-like material, for the discovery of novel antineoplastic agents working very differently from the existing drugs.

        Instead, he chose to patent the discovery himself and started charging patients for the treatments rather that publishing results. This made him a lightning rod for FDA that stated publicly that they will never allow to license a drug to a person (as they are in bed with big pharma).

        This is a freedom issue, as government tried to indict him several times based on lies rather than facts. That backfired and he was never convicted.

        At the same time, NCI that publicly stated Burzynski’s drug was worthless, patented the same active substances Burzynki previously did. The plan was to have him in prison, so he could not fight patent infringement.

      • Vad, I agree, about the "Best Documentary" comment. The... [#103309]
        By: vancouver2010 (11 comments) Go to top ↑

        Vad, I agree, about the “Best Documentary” comment.

        The man sure has some tenacity, that’s for sure, I would have probably been to beaten down, and or or given up, after only a few years of the, in my opinion, blatantly obvious tactics being used by the FDA.

        I have watched the movie, a few times, with disgust on how the FDA, still to this day is attacking Burzynski, and his ground breaking, life saving work.

        I also have watched, as it is on the website that promotes, if you like; his movie and work, the “opposition” does to show, their skewed take on Dr Burzynski’s work, link below.

        http://www.burzynskimovie.com/index.php?option=com

  42. I continue to watch them. CAD and AUD, both coiling up in... [#103314]
    By: Les (7233 comments) Go to top ↑

    I continue to watch them. CAD and AUD, both coiling up in triangles and waiting for a trigger. Direction cannot be predicted but with balance sheet expansion occurring a breakout looks good. No need to anticipate the move, one can wait.

    EUR/JPY is a dead duck. Much work required to repair this currency pair. AUD/JPY is similarly coiled up in a triangle.