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Hear's ya loud and clear, but totally tied up with scheduling Thanksgiving food deliveries. Later...
There's one MAJOR CONUNDRUM in this whole "dollar plunging" scenario that I'm still working on.
In a nutshell, if the dollar plunges it will definitely raise the relative price of gold/silver. But...I still think it should also raise the price of stocks since(and we've talked about this before)it will take more dollars to buy 100 shares after the plunge than before the plunge.
But that also has to be juxtaposed to the other factors including, but probably not limited to...1. Can we trust the numbers coming out of the companies/stocks? 2. The recession and deflation will be pulling stocks down at the same time the weak dollar is pulling them up. 3. The strength of sentiment toward stocks gained by the administration's efforts to fix the economy through "bailouts", stimulus packages, job programs, interest rate adjustments, etc.
It's just not a simple equation no matter how you look at it.
Any thoughts on this end of the scenario? TIA
By the way...the markets are now bumping up against one of the old support levels which are now acting as resistance. It wouldn't surprise me to see another dip at the eod, but I really doubt we'll see new lows anytime soon.
It's about time for a nap, so I'll check in again later. No trading opps that I can find so far today. The market seems remarkably stable for the moment with a possible slight upward bias.
Obama's remarks and the Citibank bailout seem to have calmed things down for the time being. Have to wait and see what trend develops later today, this week(shortened), or next week.
I caught that show too. Your synopsis of what was said seems spot on to me.
Remember when I said that I was worried that China's new bailout package might be signalling the end of their investments in our debt about a week or two ago?
That was still up for debate on the show, but the "smart guy" agreed with my analysis. The other guy had an excellent point too however when he compared the current financial relationship between China and the US as the 21st century version of "MUTUAL ASSURED DESTRUCTION", only in the financial sense.
They are as dependent on us as we are on them it would seem, at least for now. This is a very liquid situation though, and ANYTHING could happen at any time very quickly.
Besides the fact that China, being a new player in this game may not make what seems like the logical decision in our minds.
S&P 500/SPY etf 20 yr chart
Confirmed DOUBLE TOPS are a VERY VERY BAD CHART PATTERN. I can't remember a double top that ever resolved itself well. In every case I can remember seeing, the "neckline" or bottom of the middle downleg NEVER HOLDS as support. Not only that, but the double top always in my memory is the beginning of a VERY LONG DOWNTREND with sporadic up bumps along the way.
It suggests that Cramer's call for Dow 6000 or even lower(4000?) could be in the cards before this pattern resolves itself and heads into something else.
USD/GLD/SLV 15min-5day live interactive comparison charts
http://www.marketwatch.com/tools/quotes/intchart.asp?submitted=true&intflavor=advanced&symb=DXY&origurl=%2Ftools%2Fquotes%2Fintchart.asp&time=3&freq=7&startdate=&enddate=&hiddenTrue=&comp=gld%2C+slv&compidx=aaaaa%7E0&compind=aaaaa%7E0&uf=7168&ma=1&maval=10&lf=32&lf2=16&lf3=0&type=4&size=3&optstyle=1013
Ay Caramba! Acapulco! Se me olvido el cuaderno in la biblioteca a mi escuela con mi amiga muy guapa. LOLOL
Translation:
Holy Crap! I've forgotten my notebook in the library at my school with my pretty girlfriend.
A few words I can remember and string together from my Spanish classes taken over the years. That phrase represents a substantial portion over which I still have ready command. LOLOL
Silly boy...LOL
BTW...if you want to, you can re calibrate my charts in the iBox to any time frame you like. Just do the whole chart/properties/copy thing. You know how to do it.
Look up in the iBox
Show us, once again if you would, some longer term USD charts, going back to January 2006 if possible. Thanks.
Wild times now and to come it appears, without sensible and pragmatic moves from many quarters. 2012, add the numbers together and you get 5, the number that in numerology represents change. Hmmmm...
We're less than 200 points from the old closing low in the Dow again.
Judging by the repeated and progressively weaker bounces off that level I have a strong feeling that we're about to see the next leg down. UNLESS....the USD breaks down. That's the only thing I can think of that might turn the market numbers around.
Hang on to your hat bro'
And there's that magic number 2012 again. I'm tellin' ya...this is getting to be more than an extreme coincidence that that year shows up in so many scenarios from such wide ranging sources in both time and space.
I'm not a religious man, but I do know that there are more things in this universe than most are willing to admit.
RE: Celente predictions....
I've said for several years now that the ultra rich are just begging for a revolution. A violent revolution with their in-your-face arrogant disregard for the rest of us.
I've also said that it will happen if something doesn't change TOUTE SUITE and I think that Obama's election is a sign of those emotions rising to a crescendo.
I think he's the ultra-richs' last chance to back up and make things right within the current structure or a new structure is going to rise up to take its place.
And now with the information/communcation age in full swing, they can't keep us separated from each other and pitted against each other for much longer which is how they always controlled the masses in the past.
I think Celente is absolutely correct, and there's precious little time to change the path we're heading down now.
USD LIVE CHART...seems to be flattening out at(at least temporarily) I'm waiting to see if it can break above 87.75ish or gets resistance there again for the third time. Could still go either way.
The higher the USD goes, the less everything else is worth in relation to it...(including stocks/commodities)
http://www.marketwatch.com/tools/quotes/intchart.asp?submitted=true&intflavor=advanced&symb=DXY&origurl=%2Ftools%2Fquotes%2Fintchart.asp&time=6&freq=1&startdate=&enddate=&hiddenTrue=&comp=Enter+Symbol%28s%29%3A&compidx=aaaaa%7E0&compind=aaaaa%7E0&uf=7168&ma=1&maval=10&lf=32&lf2=16&lf3=0&type=4&size=3&optstyle=1013
Why Gold Is Down, But You Can't Get Your Hands on Any
Jim Kingsland At first glance, it appears as if the gold bugs, those bullish on gold, have been stepped on this year. Spot gold is down nearly 30% from its peak of $1033 an ounce set earlier in the year.
But a two tiered market has developed where speculators have been badly burned trading gold futures, while some investors holding actual physical gold have managed not only managed to keep their shirts, but have held on to gains for the year.
Dealers and analysts are calling it an “upside down” market where physical gold, including coins and bars, are in short supply and far more expensive than the price quoted on New York Mercantile Exchange’s COMEX division.
What’s sparking the demand for physical gold? You need to look no further than the financial landscape surrounding investors.
“I’ve never seen anything like this,” says Scott A. Travers, author of The Coin Collector’s Survival Manual. “1979 and 1980, the go-go years of Jimmy Carter, gas lines, inflation, interest rates at extraordinary levels had people rushing to tangibles. The frenzied pace for yellow metal today has exceeded those tumultuous levels.”
On top of a slowing economy, liquidation by cash hungry hedge funds has gotten much of the blame for the slide in commodities futures prices including the metals group.
In recent trading, the active December contract has traded in the area of $740 per ounce, while one-ounce bars of gold have been trading at or near 20% premiums to the front-month futures contract, according to gold dealers. Usually the premium is only about 5%.
The same goes for silver, where Comex paper futures are trading at just over $9 an ounce, compared to physical supplies commanding prices above $12 an ounce.
There’s an even greater discrepancy involving average uncirculated one-ounce late 19th and early 20th century gold coins known as $20 Liberty and $20 St. Gaudens coins. These particular gold coins, which normally attract a price of about $70 an ounce above spot, are attracting bids of at least $1,100 a piece.
Online auction sites have experienced active auctions for one-ounce gold coins. A quick check of eBay (EBAY) yields a variety of examples of gold coins trading at big premiums to the spot price. A 1908 one ounce $20 Double Gold Eagle had attracted more than two dozen bids and price of over $1200.
Says Travers, “physical gold does well in times of economic distress, calamity and blood in the streets,” adding that “gold is really a quasi-currency; as people worry about a possible collapse of the banking system. With (Treasury Secretary) Paulson’s change of policy on how to use TARP funds, the collapse of the global banking system is still not off the table.”
While the price of gold futures has sunk into the low $700 per ounce range, World Gold Council data show that a pricing floor may be developing, even for beaten-down Comex contracts, due to lower gold production. Through the second half of the year, the Gold Council reported a 4% drop in mining output and a decline in central bank sales.
I think his pragmatism is his best asset.
That, combined with the willingness of the best of American's in all sectors, (aside from their own priorities-which could make obstacles), to help him with the overall economic multitude of problems facing the USA going forward into 2009 and beyond, is what may provide some relief.
Although that relief may not assist all of the sectors involved, as sacrifices and cutbacks will simply have to be made.
Prophecy was the wrong word for sure. The lexicon of religions and astrology are unfamiliar to me for the most part.
I think what the program said was that the 64 combinations/permutations? of the I Ching, when subjected to a mathematical model of some sort...beginning in the year of it's creation by XXXXXXX?, mathematically ends in the year 2012.
I think it's 64 X 64 years beginning at it's creation ends in 2012, but I'll have to see if I can verify that.
The interesting part about this mathematical model is that it's author was apparently unaware of the Mayan Long Count calendar when he wrote his "thesis" on the I Ching.
It just seems odd that that particular year/date seems to be the focus of so many disparate sources dating back over more than 2 millenium.
As for stocks...I think I'm getting a bit closer to going long here on the market in general. It has some to do with historical events(previous recessions/depression parameters), current events and charts and Obama's presidency getting closer to becoming a reality along with his insistence that he WILL GO AHEAD WITH HIS AGENDA inspite of the national debt and deficit.
I really love this guy, and have a TREMENDOUS AMOUNT OF FAITH in his vision and ability.
You and Cramer both. re: the maintaining of the 8000 Dow Jones still being iffy depending on events to come yet.
I never knew the I Ching was prophecies? You just toss the coins and read the Hexagram given by the combinations of the two kinds of lines, and their value. Used to do it sometimes in Montreal when playing drums for Jesse Winchester. Jesse was into the I Ching at that point in time. 1969 or so...
I found it an interesting reflection, on what is supposedly supposed to clarify the situation being queried about, by the arrangement of the lines and the text it referred to when the overall Hexagram was constructed from the two kinds of lines.
No use fretting about the end of the world whenever it comes, methinks. Bing, bang, boom. Lol...
I fooled myself thinking the old way with silver, that rough times would make it pop. Too many other factors now, and electronic speed that keeps everyone aware of every little move. Though usually silver tracks with oil and the dollar (still dominant though weirdly so), it can respond like mecury to 'events'.
I hate knowing this was all coming and then playing it not so well at the moment. Guess like silver itself, my fortunes could take a positive turn. Leave it at that...
Wowie zowie...what a day. Thank goodness I saw the triple bottom on the Dow at 8000 coming. Within an hour of it hitting that level today I figured out what the percentage gain of BGZ would be from where we were at that moment and put in a sell for 1/2 of what I had just below that. Only missed by less than 1 percent of the top. Then, as it looked like a bigger bounce was coming I went long on the BGU in an equal number of my BGZ just in case it keeps going so I'm net neutral now on the Dow.
I'm still EXTREMELY SKEPTICAL however whether the 8000 level will hold. It was an obvious technical marker. The G-20 meeting and the potential hedgefund redemption move tomorrow will have more to do with where it goes from here than any technical bs.
RE: that 2012 thing...I found out that the 5000 yr old I Ching also apparently has focused on that date. It seems their recurring 64 symbol system ends it's prophecies on that that date too. In fact, If I heard it right, it ends on the exact date of Dec 21, 2012
And to top that off, the oldest Native American Indian tribe, the Hopi, also believe that the fourth world will end then and the fifth will begin.
This is getting kind of spooky!
The last big bounce in the market came when the Fed "came up with a plan"...LOL
Tomorrow we break the old lows because "the Fed doesn't have a fucking clue", or is hell bent on destroying the economy. It's hard to tell exactly what Paulson's intentions really are.
TTYL SB
The English equivalent of the Fed said this morning that they're not expecting any inflation in the foreseeable future and they've given up on trying to prop up the Pound Sterling against the USD.
The Dollar continues to rise, still only relative to other currencies, but still dragging down commodities and precious metals.
No end in sight yet and this is looking more and more like a very long lived and very deep recession/depression scenario.
I may have to liquidate my physical silver soon just to raise capital to pay bills myself. Not looking forward to that, but I don't see it getting any better any time soon, and in fact will likely get much worse before it gets better.
In hindsight, I now realize that the drop in silver in the face of huge liquidity injections was because the banks knew what was about to happen and we got caught in the mess.
Buying silver was "logical", but the "reality" of the situation was simply unknown to us little guys....AGAIN.
Watch your shoes...I'm about to puke in disgust...AGAIN.
Yeah, I hear ya. Dylan Ratigan was seriously upset over the lack of transparency with TARP and now the decision to change the way Paulson will newly attempt to implement it. What a flip flop!
Everyone is scrambling to preserve capital or stay afloat, or get what they can from wherever they can: read bailouts.
Everyone wants the bailout. California in dire straights, auto industry, student loans, ect.
When one of the big banks' spokesman stated this morning that THE RE-DEFAULT RATE on mortgages "saved" by the T.A.R.P. is estimated to be 44% I went short the whole market.
Then Paulson stated that "market tumoil will continue until the housing crisis is behind us" and I WENT SHORTER.
Wait until we break the last low back in Oct....then the shit's REALLY GOING TO HIT THE FAN.
I'm guessing we'll be there by Friday afternoon at the lates.
I swear...the more I hear Paulson flailing around the more I believe that this is JUST ANOTHER HUGE TRANSFER OF WEALTH from the middle class to the wealthy via the banks and corporations.
God help us all...Bush's "sprint to the finish" is going to be uglier than any of us could have imagined.
Just don't puke on my shoes please; like the time Jerry Lee Lewis was spotted at a urinal and when the guy who spotted him said something to him, he drunkenly turned to reply, and he peed on the guy! LOL!
I think we're heading to a harder crash than the currently expected so called 'extended recession'. The late night CNBC Asia/Europe guys had a guest on who was predicting a crash in China and England, and we're a prime target too because of the excesses that have gone on too long. I keep having concerns about the eventual lowering of the sovereign credit rating of the USA.
There's just too much crap out there from these 20 plus years of debt/credit/leveraged activity. And nobody wants to own up to where they stand in relation to debt, until they are forced to bring it to light.
And now everybody and their brother wants a bail out. Ain't gonna happen.
Just the normal fact of our soon entering the season of winter, which is a cold and contracting environment, will slow things down.
Even Obama's entry onto the scene in January cannot forestall the global, 'paying of the piper'. There is simply no rapidity in implementing government programs. And, how effective they will be, as noted in the lack of transparency of TARP funds now, and that snuck in tax break for the banks, (which, BTW, will cost CA two billion in lost revenue, right when we desperately need it).
Gold/silver will have a bounce when it gets too scary and people get overly fearful, chart technicals aside.
USD/DIA/SLV/GLD/GDX/NTRI...90day charts
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USD/DIA/SLV/GLD/GDX/NTRI...40day charts
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FWIW this is what I was mentioning recently. There is a video to go with this. It was on cnbc.com
http://www.cnbc.com/id/27641538
US May Lose Its 'AAA' Rating
10 Nov 2008 | 07:49 AM ET Text Size The United States may be on course to lose its 'AAA' rating due to the large amount of debt it has accumulated, according to Martin Hennecke, senior manager of private clients at Tyche.
"The U.S. might really have to look at a default on the bankruptcy reorganization of the present financial system" and the bankruptcy of the government is not out of the realm of possibility, Hennecke said.
"In the United States there is already a funding crisis, and they will have to sell a lot more bonds next year to fund the bailout packages that have already been signed off," Hennecke told CNBC.
In order to solve or stem the economic slowdown, Hennecke suggested the US would have to radically reduce spending across all sectors and recall all its troops from around the world.
As for a stimulus package, there is not much of an industry left to stimulate back into life, Hennecke said.
© 2008 CNBC.com
Re:Fed Defies Transparency Aim in Refusal to Disclose
It's not surprising that they're trying to keep this info under cover. It's almost certainly much worse than we know so far.
I did see a quick blurb on this very subject on the Keith Olberman show tonight.
I did buy 100 SLV near the eod today after thinking about the Chinese bailout of their market. I figured that if they're going to start focusing on rescuing their own economy that they're not only going to be less likely to continue buying our treasury notes but may in fact use the reserves of USDs that they already have to provide their own liquidity.
The $560 billion dollar injection could come in the form of US Dollars and that COULD signal the beginning of some inflationary pressures.
The market reacted to it early in the day and rallied, and although it ended down for the day I noticed that silver/gold were holding up and staying positive.
This fact and watching the USD struggling around it's current level and failing to make any gains above the 86.50ish level on the DVX index also encouraged me in the purchase of the SLV today a few minutes from the close.
3X Leveraged ETFs November 10, 2008
BGU / BGZ / ERX / ERY / FAS / FAZ / SSO / TNA / TZA
Contrary to expectations (including mine), the Direxion 300% leveraged and inverse ETFs are rapidly gaining traction in the marketplace.
The company launched eight super-leveraged ETFS last week:
Fund
Ticker
Index
Large Cap Bull 3x Shares
BGU
Russell 1000 (300%)
Large Cap Bear 3x Shares
BGZ
Russell 1000 (-300%)
Small Call Bull 3x Shares
TNA
Russell 200 (300%)
Small Cap Bear 3x Shares
TZA
Russell 2000 (-300%)
Energy Bull 3x Shares
ERX
Russell 1000 Energy (300%)
Energy Bear 3x Shares
ERY
Russell 1000 Energy (-300%)
Financial Bull 3x Shares
FAS
Russell 1000 Financial Services (300%)
Financial Bear 3x Shares
FAZ
Russell 1000 Financial Services (-300%)
The funds are designed to deliver 300% and -300% of the daily return of their benchmark indexes, and follow in the success of the wildly successful ProShares ETFs, which provide 200% and -200% exposure to the market.
Gold/silver/USD wedges are all coming to the final squeeze range this week.
Something has to give pretty soon, and with all the new bad news, the unknown quantities of bad debt, etc it looks like a big downer for the general market coming as the hedgefund redemption date of Nov 15 approaches.
Unfortunately for silver/gold, the flight to and hoarding of the USD are accelerating again as evidenced by the treasury interest rates dropping again ACROSS THE BOARD all the way from the 3mth to the 10yr.
So the market is going down which will drag equities as well as commodities down with it since there will be yet less demand and which will in turn hold down any inflationary pressures.
From where I stand, there is nowhere to go at the moment and I guess I'll just stay out until the next technical bounce presents itself somewhere.
Longer term, since Obama was elected, I think there MAY BE a positive bias towards heavy construction and alt energy stocks
but they'll have to weather the next leg down too before they begin to get legs somewhere closer to the inauguration or afterwards.
One possible bright point might be that China has now instituted a HUGE STIMULUS PACKAGE too(relative to the size of their economy compared to ours)which signals that they plan to attempt to continue their growth through domestic consumption.
This COULD POSSIBLY give a little boost to some construction and energy commodities such as oil/coal, but I doubt it'll be anything to get too excited about.
Have not studied this purported coming event.
The reason I ask about Dec 21, 2012 is because a year or so ago I heard about an asteroid that's been discovered and is being tracked that is calculated to come excrutiatingly close to Earth in 2012.
So when I saw the Discovery Channel special on the Mayan Long Count Calendar it clicked and I thought it was very interesting.
The Mayan Calendar is said to be so accurate that it far exceeds our own and predicts successfully astronomical events so far into the future that nobody can figure out how they were able to create it.
Also, I want to know if any other religions have any mention of the date/year.
Here's a link to the asteroid info.
http://www.google.com/search?sourceid=navclient&aq=t&hl=en-GB&ie=UTF-8&rlz=1T4DACA_en-GBUS274US274&q=asteroid+2012+nasa
I have an astrological question for you.
Can you tell me what, if any, significance and/or predictions that astrology holds for the date...I'm trying to estimate just how many pallets of toilet paper and 1 month boxes of nutrisystems I'll need to stockpile.
December 21, 2012
http://www.google.com/search?sourceid=navclient&aq=t&hl=en-GB&ie=UTF-8&rlz=1T4DACA_en-GBUS274US274&q=Mayan+calendar+2012
ALL ABOUT 2012
The date December 21st, 2012 A.D. (13.0.0.0.0 in the Long Count), represents an extremely close conjunction of the Winter Solstice Sun with the crossing point of the Galactic Equator (Equator of the Milky Way) and the Ecliptic (path of the Sun), what that ancient Maya recognized as the Sacred Tree. This is an event that has been coming to
resonance very slowly over thousands and thousands of years. It will come to resolution at exactly 11:11 am GMT.
Don't forget the TP when you're stocking up for the apocalypse. And I speak from experience when I tell you that paper towels will do in a pinch. Beats the hell out of wet leaves, telephone books or grocery bags. LOL
I'm thinking I'll order the Nutrisystems diet for 2 people and stockpile one of them right next to the pallet of TP I've made a space for in my basement.
BTW...we might want to consider things like SS and Medicare etc are still in place even though for decades we've seen that the financial obligations we've already incurred for the future haven't been covered.
They remain because we believe we'll figure it out before it's too late. We'll find a way to deal with it through ingenuity, belt tightening etc.
If it comes to pass that what that article says is true, we have NO CHOICE but to find a way to deal with it. The alternative just isn't an option.
If we have to defer payment on the debt, print money, forgive the debt, recalibrate the entire global monetary system or whatever, we will find a way to survive it.
It's in all of our best interests to do whatever we have to do.
It's funny, when I used to go to the oval to enjoy the Sport of Kings, I'd study like hell to figure out the best post positions for the distance being run (and on dirt or turf), the hot jocks for dirt or turf or short or long distances, the hot trainers, the best workouts, ect.
And, when I'd lose and find some tidbit of info that I should have factored in, I'd say, "It's what you don't see that kills ya." Lol.
And I've studied a bit of the arcane and esoteric along the way as well, curious about what are the really unbreakable Universal Laws of Existence beyond the appearance of 'form' and 'beliefs'.
But the following article, FWIW, is a point in fact. NO ONE really knows how much unreliable debt is still out there and even Obama and his new team, as sharp as they are, may not be able to hold back the tide, if the shit really hits the fan in worthless debt that simply can't be covered.
THAT's when gold and silver will simply explode like rockets as never before in modern times. If there is that kind of lousy, crappy, un-repayable debt of magnitude, well, it would be even a bigger pile of manure to shovel...i.e. By this calculation there is a friggin' mountain of possible screwed up debt situations.
This article below was on the Breaking News board tonight when I got home from selling.
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The Economy Collapses: Depository Trust & Clearing Corporation (DTCC) Obfuscates Seriousness of Crisis
by Andrew Hughes
Global Research, November 6, 2008
Today heralded the long awaited release of figures compiled by the Depository Trust & Clearing Corporation. The latter is controlled by Banks amongst which are JP Morgan and Goldman Sachs.
From their Article..
"Reported estimates of the size of the credit default swap market have so far been based on surveys. These surveys tend to overstate the size of the market due to each party to a trade separately reporting its own side. Thus, when two parties to a single $10 million dollar trade each report their "side" of the trade, the amount reported is $20 million, which overstates the actual size by a factor of two since both reports relate to a single $10 million contract. When examining the outstanding amount of actual contracts registered in the Warehouse (not separately reported "sides") as of October 9, 2008, credit default swap contracts registered in the Warehouse totaled approximately $34.8 trillion (in US Dollar equivalents). This is down significantly from the approximately $44 trillion that were registered in the Warehouse at the end of April this year."
Well some good news at least it's not the widely reported $54 Trillion, it's just $34.8 Trillion. Now..
"Less than 1% of credit default swap contracts currently registered in the Warehouse relate to particular residential mortgage-backed securities. Mortgage-related index products also have some components relating to residential mortgages and, as a whole, also constitute a relatively small fraction of total credit default swaps registered in the Warehouse."
Well the Mortgage market is in Freefall so we can probably expect 1% of $34.8 Trillion ie $348 Billion at very high risk. So what accounts for the remaining $34,452,000,000 ? We have to assume it's a Mix of :
Foreign Exchange Contracts
Forwards and Forex Swaps
Currency Swaps
Options
Interest rate Contracts
Forward rate Agreements
Interest Rate Swaps
Options
Equity-linked contracts
Forwards and swaps
Options
Commodity contracts
Gold
Other Commodities
Forwards and Swaps
Options
Credit default swaps
Single name instruments
Multi name Instruments
Unallocated ?
The exposure to destruction by CDS's was never just about exposure to Mortgages. Looking at the list above, it is plain to see that the possible vulnerable flanks are many. The DTCC summary press release neglects to address this. With companies reporting ever increasing losses, unemployment growing at an unforeseen rate and thousands of Funds going broke after trillions were lopped off the top of the Global Stock Market, the collapse can only increase. It is not contained.
There is no mention of the Credit Default Swaps done on the Financial health of entire countries, never mind Giant corporations like General Motors. The writing is on the wall for a huge proportion of the base assets involved and the associated default risk will be increasing alongside them. It's no surprise that the DTCC does not want to explore beyond the Mortgage angle. Everyone knows about the Mortgage crisis, but this was only the precipitating event - itself precipitated by a very ill basic economic base - that knocked over the first domino. The rest have already begun to fall and we see the tide coming in closer every day. This is no time for obfuscation and patronising; we need to know the Real Facts not..
"The idea that the industry lacks a central registry for over-the-counter (OTC) credit default swaps (CDS) is grossly misleading and has resulted in inaccurate speculation on a number of matters, including the overall size of the market, its role in the mortgage crisis, and the size of potential payment obligations under credit default swaps relating to Lehman Brothers. The extent to which such speculation has fueled last week's market turmoil is difficult to determine."
I think the Market was in turmoil, not because of paranoid speculation, but in reaction to an ever worsening economic outlook, which shows absolutely no sign of getting better anytime soon.
http://www.globalresearch.ca/index.php?context=va&aid=10836
Factors that could push future inflation further down the road and/or cause it to be more muted than current common knowledge would suggest...
BULLET POINTS:
Obama's alternative energy plans will help to keep oil prices low, and oil prices affect all other prices through transportation and manufacturing costs. This will keep inflation at bay for a VERY LONG TIME if not forever once it becomes a reality.
Obama's infrastructure plans will create jobs but will also encourage HUGE AMOUNTS of lending to construction companies and municipalities by the banks. This action will temporarily increase the liquidity and hence inflation, but will also enable the banks to pay back the $700 billion bailout package much sooner which will have the effect of REMOVING that same liquidity from the system relatively quickly.
The Fed has lowered interest rates to such a low level that increases will be very easy and will come quickly at the first signs of the economy "overheating" in what could be a rapid recovery once it gets some legs near the halfway point of 2009.
Overleveraging will not be allowed if the planned proper regulations and actual oversight and enforcement are instituted so that super fast hyper-growth will be unlikely to ever match the most recent binge of borrowing/buying.
Since silver is also an industrial commodity that will benefit from increased manufacturing in a growing economy, I think it will be a better investment than gold which seems to depend more heavily as a hedge against inflation rather than having any real value other than it's pretty in jewelry and is rare on the earth. This may be the time when the gold/silver ratio comes into play, although I suspect that during this period gold will come down as much as silver goes up to fill the gap in the ratio between the two.
Some other thoughts...
During this whole "wedge building" process on the charts, it occured to me that each time the market rallied the talking heads were saying they thought that the hedgefund redemption selling was probably done.
Then each time it dropped again they'd say it was more hedgefund redemptions.
It appears to me that what's been happening is that the hedgefunds stop selling TEMPORARILY in order to let the market rise and then all of a sudden they start dumping again into the rally.
I also notice that the up days are on LOW VOLUME while the down days are on HUGE VOLUME, which I think validates my theory, AND...the USD chart pattern is slightly different from the others in that in the last 10days or so the pattern is a "descending triangle" with lower highs and basically a flat bottom rather than a wedge with both higher lows and lower highs. This signals to me a weakening in the dollar and seems also to be aiming at or near the 15th next week.
This all makes me think that there could very possibly be another HUGE DIP on next Tuesday or maybe Wednesday, or maybe Monday, Tuesday AND Wednesday of next week since the time for "playing games" before redemptions is now just about gone and they'll HAVE TO HAVE ALL THEY NEED ON HAND for the redemptions coming on the 15th/Next Wednesday.
I've been stopped out at a profit on ALL MY POSITIONS as of yesterday and I plan on keeping all my powder dry until I see what happens on Tues/Weds of next week.
At least at that point we'll have a substantial amount of time before any further redemptions will be forced out of the hedgefunds.
PS: I'll try to read that article this morning, but I have a lot on the table today and I'm also very interested in Obama's statement today. I think he's going to start setting the "tone" for the future starting today, and that'll be as important as any other info we'll have anytime soon.
Finally, I think there'll either be a huge dip next week that will present a BEAUTIFUL buying opportunity, OR...the market will hold right around here THROUGH WEDNESDAY which will signal to me that we really are at the bottom turning point for the general market and "halfway through the recession".
Either way, I'll ALMOST CERTAINLY be buying gold/silver VERY SOON.
Glad to be around to bounce our perspectives and the news we find.
These are crucial times and it's always good to share thoughts, so as to stay on top of things as much as possible.
Let me know if you get a chance to listen to that Robert Kuttner interview with Teri Gross.
I missed some of it while out working on the road, and will re-listen to it this a.m. before I'm off to work for the food gig.
BTW...I really appreciate all the articles and perspectives you've been bringing to the conversation.
I also need someone who's as interested as I am to bounce my ideas off of and a reason to post my thoughts which helps me keep it all straight in my head.
Together we'll do a lot better than separately I think.
Govt absolutely CAN INVEST IT'S WAY OUT of this mess. It only depends on where they put the money.
I personally believe that infrastructure investment, and green investment is the answer to this problem.
It creates millions of jobs that can't be outsourced, removes us from dependence on foreign oil and saves the planet all at the same time. And as you know this is a key part of Obama's economic plan.
It's really a NO-BRAINER.
Obama will speak today to some of this. That should be interesting.
Appreciate all these comparitive charts and your synopsis.
Good interview yesterday on NPR's 'Fresh Air' with Teri Gross talking to Robert Kuttner who wrote a book, 'Obama's Challenge': A Transformative Opportunity.
It's likely on their website and it was interesting in that he basically explained why and how the government can actually invest it's way out of the current recession and he gave numbers as a percent of the GDP on how much debt is sustainable and actually will help address the difficult challenges before us economically.
He also drew comparisons to previous situations of this mold.
In fact, here it is if you have the time and interest.
http://www.npr.org/templates/rundowns/rundown.php?prgId=13
CHARTS HEADING INTO NOV 15TH
Testing the "4 MTHS" theory that the dollar has a short term 4 mth rally after a disaster and then turns dramatically downward.
Arguably, the $USD did a final test of it's short term bottom on or slightly before July 15th.
Is it a coincidence that Nov 15 is the next hedgefund redemption date? That would be 4 mths.
Is it a coincidence that the gold chart shows a narrowing range of trading(WEDGE)these last several days? Or is it anticipation of not only the hedgefund redemption and top on the USD?
Is it coincidence that today's HORRIBLE jobs report and last months huge negative jobs revision didn't tank the market or has it been priced in already?
Is it a coincidence that I just heard the talking heads saying that all the money sitting on the sidelines is "waiting for the Nov 15th redemption date" to make any serious commitments.
NOW...the question is...which way will the market go THE DAY AFTER NOV 15TH? Are we really "HALFWAY THROUGH THE RECESSION" yet?
I think there's a substantial bet being made that we are, but that doesn't guarantee it.
I'll be watching the news and the charts closely to see if there are any more clues to be had.
PS: I don't yet trust today's rally. I think it's just a technical bounce after the 3rd worst 2-day drop in the market since whenever. I'd be buying at the bottom(s) of the "WEDGE" if I were going to start betting now. Today would be a good place if that's your strategy.
Seems like a lot of others are thinking the same thing.
"The cycle of inflation"...
I would like to end with a quote from Jens O. Parsson’s book “Dying of Money.” It perhaps explains best where we are today and where we are headed.
“Everyone loves an early inflation. The effects at the beginning of inflation are all good. There is steepened money expansion, rising government spending, increased government budget deficits, booming stock markets, and spectacular general prosperity, all in the midst of temporarily stable prices. Everyone benefits, and no one pays. That is the early part of the cycle. In the later inflation, on the other hand, the effects are all bad. The government may steadily increase the money inflation in order to stave off the latter effects, but the latter effects patiently wait. In the terminal inflation, there is faltering prosperity, tightness of money, falling stock markets, rising taxes, still larger government deficits, and still roaring money expansion, now accompanied by soaring prices and ineffectiveness of al traditional remedies. Everyone pays and no one benefits. That is the full cycle of every inflation.”[10]
The dollar is testing the $84.50 level for the third time today. If it doesn't hold look for the next gap level at $83.00
If it does hold we may have to weather a move back up towards $86.50ish but there's virtually no chance it'll be able to hold that level.
And it may take a few days to get back up there so be patient if it happens and then make your next play/buy on the gold/silver dip that'll coincide with that dollar move.
And don't forget...THE ECB and the JAPANESE are going to be cutting rates too. The ECB has a LOT MORE ROOM to cut from here than we do. The Japanese are already near zero but they still have a little room none the less, and they do plan on cutting what they can.
USD next gap levels to watch for reversals...
HIGH-$86.25
LOW-$84.50...$83.00...$82.30...$79.85...$77.85
McGRANDPA's choice of Palin for VP was irresponsible, dangerous and an insult to Americans. By that choice and his continuing evil he's proving he'll do anything to win this election even to the point of endangering his own country. DEFEAT HIM!
PROSHARES...COMPLETE LIST OF LONG AND SHORT ULTRA ETFs
http://bespokeinvest.typepad.com/bespoke/2008/07/proshares-ultra.html
Entered 9/10/08....Cramer's prediction for the bottom in the housing market...June 30, 2009
THE GOLD/SILVER RATIO STRATEGY and THE CASE FOR SILVER http://www.gold-eagle.com/editorials_03/sanders030703.html
KITCO SILVER AND OTHER REAL TIME "SPOT" CHARTS http://www.kitco.com/charts/livesilver.html
USDX DOLLAR INDEX...CHARTS/STATS/ & BULL/BEAR COMMENTARY http://www.fxtrademaker.com/usdx.htm
LIVE UPDATING PRICES/CHARTS...GOLD/SILVER/USD/FOREIGN CURRENCIES/LIGHT SWEET CRUDE http://www.post1.net/lowem/page/livequotes
SILVER INSTITUTE...THE REAL NUMBERS ON SILVER! http://www.silverinstitute.org/supply/index.php
SILVER/GOLD/DIA/$USD (side-by-side comparison charts)
http://investorshub.advfn.com/boards/read_msg.asp?message_id=27785873
Monex LIVE PRECIOUS METAL PRICES
http://www.monex.com/liveprices
Precious metals charts
http://www.infomine.com/Investment/HistoricalCharts/ShowCharts.asp?c=silver
Updating 'melt prices' and commentary on coinage
http://www.coinflation.com/
The Buillion Desk
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Yahoo Interactive chart link
http://finance.yahoo.com/echarts?s=HTE#chart1:symbol=hte;range=1y;indicator=split+dividend+rsi(7)+wpr(7);charttype=candlestick;crosshair=on;logscale=on;source=undefined
DOM PGH (drip divys)
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Big Board Solar Stocks
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