Art

Today being Thanksgiving, I wanted to do something fun/different.
This has nothing to do with finance, but eh, its my blog.

I enjoy various photography, and one site is "deviant art".
Some artwork below. A second site for awesome desktop screens is InterfaceLift.

Saturday Night Live video on US Debt and China

The old cliche, it's funny since its true.

Economic News Roundup

In its second reading of third-quarter gross domestic product, the Commerce Department said the economy grew at a 2.8 percent annual rate, rather than the 3.5 percent pace it estimated last month.
My Spin, considering job losses are between 300K and 500K per week for the last year, and GDP according to current US Government estimates is 2.8%, and US national debt was increased by about 10% in ONE YEAR, this is not good. But if we ignore massive government debt, 2.8% is respectable all things considered, but hardly considered a strong recovery.

MUMBAI: The US dollar is expected to remain the carry trade currency of choice in the near term and the unwinding of this carry trade is unlikely to be as severe as that of the yen carry trade seen in the early 2008, say currency experts.
My Spin: When Japan became the carry trade of choice for the world, they experienced a 20 year recession. Their stock market and real estate has not recovered in 20 years! Let's hope the US dollar does not become the defacto carry trade currency for the next 1 year, much less 10+ years. And disregard people who say a weak currency is good for America. Ask that person why don't they put their savings into Zimbabwe currency or Mexican Peso?

FDIC deficit $8.2 billion in Q3
MySpin: The FDIC is BANKRUPT. The FDIC is floating the idea that banks pay their FDIC premium for the next 3 years upfront to get cash. Once that money runs out, what next? Ask banks to pay a premium for next 10 years? I'll tell ya whats next, the taxpayer will print money to pay itself. If that day comes, Gold is definitely where the action will be.

U.S. consumers seem slightly more confident about the economic outlook in November, but their appraisal of short-term prospects remains decidedly glum, according to data released Tuesday by the Conference Board.
My Spin: There is hope yet, the public gets that no real improvement has been made, except a paper shuffle. Now if only people would demand to enforce the law and stop making private debt into public debt to pay for billions in bonuses.


Japan Exports Fall Least in a Year on Global Stimulus
My Spin: Read the reality: Shipments abroad slid 23.2 percent from a year earlier, compared with a 30.6 percent decline in September, the Finance Ministry said today in Tokyo. Get that? A decrease of 23% is great as compared to 30% decline?!? My Rose colored glasses aren't as bright as other peoples.

The next phase of investing

History

If you read my blog, its no secret that 2009 was NOT a good year for my investing. (Gambling?) In March 2009, I wrote and my friend John Chinnock called "the bottom" of the near term Market, within a day or two of the actual bottom SPX 666. The lottery ticket recommendations made at that time paid off between 100% and 300% on investments across the board. Unfortunately for me, I didn't go all in, I treated it like a lottery ticket.
So while those trades where profitable, unfortunately, trying to call a market top took those winnings away. The market top picking started between 930-1000. Although the market only moved up 10-20% from that point, the market stayed high since July, wiping out all my earnings for 2009.

As Gary of the Smart Money Tracker and Karl of The Market Ticker both say, the markets can stay irrational longer than your bank account can handle. Meaning, trying to pick a top isn't a good way of investing.

Resources & Gold Miners

I point this out now because the next leg I am preparing for investing is trying to pick another trend, this time a parabolic bull market up. Since October of 2008, when the gold miner index (GDX) hit 17, I have been a resource bull. Meaning, resources directly or indirectly are a great investment overall, but I like Gold for the "extra fear" and therefore hyper-extension possibilities.

Sometime in the summer of 2009, I got cold feet and dumped my gold miners, probably not the wisest of moves. But it is what it is.

However, as a long term play, I have since October 2008 professed we will see Gold reach all time highs, possibly as high as 2,000 to 8,000 an ounce, but probably more likely between 1,400 and 2,000 an ounce.

Near term bearish resources & Gold Miners

Below is a a quote from another blog post, which sums up why I am against resources....again. Main reason? Because almost everyone thinks skies the limit.

While the fundamentals underpinning the gold price and gold mining stocks remain very positive, a growing subset of investment professionals has been arguing that the fundamentals are already priced in at $1,145 per ounce. Well-known market pundit Robert Prechter, founder of Elliott Wave International, released a bearish report on the gold price in his latest Elliott Wave Theorist publication. He noted that in the past two days, 97% of futures traders report being bullish on the gold price. According to MBH Commodities, this is the highest two-day reading since the organization began keeping this data in 1987. Moreover, the only other time there was a 97% reading was for one day - March 3, 2008 - only two weeks and $30 prior to the gold price reaching its previous all-time high of $1,033 per ounce. Prechter also pointed out that the silver price is still below its March 2008 high of $21.40 per ounce, while 95% of futures traders are bullish on silver. Mr. Prechter argues that the record bullish sentiment readings with respect to the gold price and silver price, along with the divergence of the gold price reaching new highs and the silver price lagging behind, provide strong evidence that the gold price is close to a significant top.

Recent View for next play

I have become interested in a market trend analyst named Harry Dent. Mr. Dent's rational for investing is based on population and market cycle trends. Mr. Dent called the market crash of 2008-2009 I believe 15 years ago, and in his 2009 book "The Great Depression Ahead" calls for natural resources to reach highs late 2009 or into 2010, before a nasty collapse. Unfortunately, this prediction is in a book published Jan of 2009, and his more recent refinements of his predictions are only available if you pay about $300 yearly for his newsletter. I paid for it today, so I have no comment on it yet, nor have not absorbed his latest vision. And quite a bit has happened since January 2009.

This past weekend, Gary of the Smart Money tracker reviewed his view of gold in his paid service. I will not go into detail of his market analysis, if you wish to read, pay his low fee of 80 bucks for six months. Anyone who has an interest in metals/resources should pay for his service.

In any event, in general Gary is looking for a leg down in gold/miners before the next and possibly parabolic rise of this sector higher.

The trick of course is when to get into a play, and when to get out. Gary will give his 2 cents on when to get in, and my opinion may differ than his. But Gary gives much more analysis than I do, so his 2 cents counts more. (hence pay for his services).

The gist is, I plan to ride this next wave down short the market (not short resources). I'll start looking for rolling into precious metals/resources WHEN IT LOOKS LIKE A GIFT. John Chinnock (friend) and my 2006-2008 market purchases where all spot-on for long term. John is and continues to be a sage of market timing. However I am unsure if this next play John will agree with me. This play is more of my opinion, faith in Gary, and a curiosity of Mr. Dent's predictions.

If you continue to read this blog, and plan to follow some of my market investments, I highly recommend paying for Gary of the Smart Money tracker, reading Harry Dent's book, and consider Elliot Wave International (stock charting) to get a reasonably wide view of the markets from different analysis.

One thing I learned in 2009, is don't get cocky, question everyone's 2 cents, scale into positions over time, and go with my gut. My gut says follow Gary's lead, and Mr. Dent a nice coincidence or corroboration to Gary. For now, no resources, and short the market.

See my disclaimer on the right about investing, and good luck to everyone.
And I reserve the right to change my mind completely, with new information. :)

US Debt Clock

Take a little time this Sunday AM to look at the USDebtClock.org site.
They have added some new information, and when you put your cursor over an item, it now tells you the source for that information. Citing each piece of data's source is a great addition, and one that is made much easier using the internet.

http://www.usdebtclock.org/

Some day, what I think years from now, when the US dollar does finally implodes or to prevent the dollar from imploding US interest rates skyrocket, people will be outraged how did this happen? It's easy, no one cared about the facts of US government financial's. The US Government was treated like an infinite source of wealth. When in reality, it is an infinite source of debt.

I keep wondering, what is the magic tipping point, 100% of GDP in debt, 200%? 10,000%? There has to be a bottom for credit-worthiness.

From WebSufinMurfs FinancialBlog2

US Dollar Carry Trade

I dislike Glenn Beck. But he does come out with segments that clearly outline critical issues. This video goes over the US debt and the world carry trade, which Japan suffered from 20 years.

A Coin Toss

The markets are pushing into a decision on direction based on longer term trend lines.
So is the market about to go down like a cheap hooker? Or rocket higher?

Its all about the USD valuation, and the devaluation game to get the markets to go higher can continue, but not forever. USD is at about 75 on the charts, somewhere between 65 and 25 would trigger a panic and collapse of the USD. That won't be good for stocks.

From market index perspective, this chart says it all. I am short the market, but not with heavy conviction. If we are significantly lower into Wednesday, I will probably cover a bit in anticipation of black friday doing better than expected.

From WebSufinMurfs FinancialBlog2