Looks like we got a market near-term bottom Friday, as Germany and France announces a "stick save" for the crisis. It can't work, but that doesn't matter. The market has sold off hard, and on any good news, a relief rally should happen.
So I'll hold off this week in charts until the close Monday, to show the "bottom" depicted.
I may move harder into cash in a week or 3, when a relief rally looks ending.
Monday, November 28, 2011
Saturday, November 26, 2011
Media Consolidation
I posted back on November 2nd 2008, on a post on Blame Republicans or Democrats, where I articulate the high level actions that have contributed together to bring the western world into financial stress.
Back then we were voting for a president, and I stated :
As for either president, either one will face what is now looking almost certainly to be a Depression due to the actions being taken now. Either will face huge debt that they can't pay for. I am torn......
Fast forward to November 2011, and it looks to me that we are in a continual recession/depression since 2008. (I can make the case since 2000, but it is less apparent to most.) We are on-track for this time period to be relabeled a depression in a few years.
One key aspect of this situation is the media of blame, from my 2008 post is the media. The media has not been doing a great job of informing the public, or even civil to those who try, as I showed in Hostile Media on non-mainstream opinions. The root of this is lack of competition for the eyes and ears of the public through TV, magazines, and newspapers. In the post Blame Republicans or Democrats, the source of the lack of media variety was born by Ronald Reagan, bringing us to the top 5 giving 80% of the information me and you get.
Today I have a more current depiction to better illustrate from "Frugal Dad" blog, thanks to my friend Bob. It depicts this change of information suppliers. My hope is over the next decade people will shift to bloggers and other news sources like I have. Although it can present questionable information, to date I don't find it less reliable than the top 6 news providers, and in most cases more insightful.
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Source: Frugal dad
Back then we were voting for a president, and I stated :
As for either president, either one will face what is now looking almost certainly to be a Depression due to the actions being taken now. Either will face huge debt that they can't pay for. I am torn......
Fast forward to November 2011, and it looks to me that we are in a continual recession/depression since 2008. (I can make the case since 2000, but it is less apparent to most.) We are on-track for this time period to be relabeled a depression in a few years.
One key aspect of this situation is the media of blame, from my 2008 post is the media. The media has not been doing a great job of informing the public, or even civil to those who try, as I showed in Hostile Media on non-mainstream opinions. The root of this is lack of competition for the eyes and ears of the public through TV, magazines, and newspapers. In the post Blame Republicans or Democrats, the source of the lack of media variety was born by Ronald Reagan, bringing us to the top 5 giving 80% of the information me and you get.
Today I have a more current depiction to better illustrate from "Frugal Dad" blog, thanks to my friend Bob. It depicts this change of information suppliers. My hope is over the next decade people will shift to bloggers and other news sources like I have. Although it can present questionable information, to date I don't find it less reliable than the top 6 news providers, and in most cases more insightful.
Friday, November 25, 2011
Hostile Media on non-mainstream opinions
I watched two videos today that are both worth watching.
First is Ron Paul, and his opinion on a wide variety of topics.
The second is a financial adviser who is not very optimistic of Europe, Japan, and I imagine, the USA.
What struck me when I watched these was the outright hostility of the interviewers.
The one interviewing Ron Paul was very aggressive in his questioning. Each one was positioned to make Ron Paul look fringe. (which he is!) I'd love to see the same interview-er with other candidates to see if the questions are this deep, confrontational, and at times dismissive!
The second the interviewer clearly had an agenda to paint the adviser as profiting from main street losses.
As in my thankful post, this man could have avoided the interview and kept his opinion to himself.
Instead he stood strong to meet in the public eye and stand his ground.
It no wonder its so hard to get the straight scoop when the media is on a mission. Shut up and conform already!
This woman says there where very few investors that knew the world was heading into financial turmoil. Why is that? oh, maybe the media isn't questioning what is presenting at face value? Nah, the media has zero responsibility to keep the masses informed, they should do like I do, read bloggers and watch random videos.
In this clip the interviewer says you can't buy insurance of a house you don't known. She is actually right. All DERIVATIVE MARKETS should be killed off or deeply restricted, and minimize leverage. Just take a look at Israel for a model of what is sane. It is these exotic Derivatives in an unregulated, opaque market that are a problem. Don't attack this man for participating in the market! Go after the construct, and fix it!
First is Ron Paul, and his opinion on a wide variety of topics.
The second is a financial adviser who is not very optimistic of Europe, Japan, and I imagine, the USA.
What struck me when I watched these was the outright hostility of the interviewers.
The one interviewing Ron Paul was very aggressive in his questioning. Each one was positioned to make Ron Paul look fringe. (which he is!) I'd love to see the same interview-er with other candidates to see if the questions are this deep, confrontational, and at times dismissive!
The second the interviewer clearly had an agenda to paint the adviser as profiting from main street losses.
As in my thankful post, this man could have avoided the interview and kept his opinion to himself.
Instead he stood strong to meet in the public eye and stand his ground.
It no wonder its so hard to get the straight scoop when the media is on a mission. Shut up and conform already!
This woman says there where very few investors that knew the world was heading into financial turmoil. Why is that? oh, maybe the media isn't questioning what is presenting at face value? Nah, the media has zero responsibility to keep the masses informed, they should do like I do, read bloggers and watch random videos.
In this clip the interviewer says you can't buy insurance of a house you don't known. She is actually right. All DERIVATIVE MARKETS should be killed off or deeply restricted, and minimize leverage. Just take a look at Israel for a model of what is sane. It is these exotic Derivatives in an unregulated, opaque market that are a problem. Don't attack this man for participating in the market! Go after the construct, and fix it!
Thursday, November 24, 2011
Thankful
My blog is pretty much all about reporting some very scary stuff, that could be viewed as negative.
Today's post is the positive.
I am most thankful for the life me and my wife have built, with our son Joey. She has been everything I could ask for and more. She is understanding, caring, strong, and very hard working to make the home life I enjoy today.
I am very thankful for all the wonderful people that has been my lifelong support system. My immediate and extended family. My friends, who have been there for the good and bad. Of all my friends, especially to the "Friday night" crew, you know who you are. :)
For my work, and more importantly, the absolutely fantastic, smart people it is my pleasure to work with every day. By extension being employed by a multi-national corporation, reasonably well compensated in this rough economic environment that I expect to last 10 years from now.
For where I live, a relatively insulated community surrounded by affluent towns. I hope it provides better for my family in the dark times ahead.
For technology, for my entire life has been permeated by it in every possible aspect. Technology provides for me through my job, finding my wife, for my enjoyment (gaming!), and for the information flow and framework to bring this post.
I am thankful that even though this country will be shaken to it's very foundation, to date, it remains relatively free.
For my health, and the health of my closest friends and family, with unfortunately a couple of exceptions.
And finally, for the unsung heroes that are fighting for a better tomorrow, by donating their time for our collective benefit. This includes all that have done so 100's of years leading us to today, and doing so today for a better tomorrow. Of the many people that fit this description, I am especially thankful for the financial bloggers. Mish, Karl Denninger, Gary of Smart Money Tracker, Slope of Hope, the minions on ZeroHedge, and the many financial insightful who voice their opinion on the public court. For without their efforts, we would have zero chance to be aware of the problems that we must collectively face and overcome.
I am most thankful for the life me and my wife have built, with our son Joey. She has been everything I could ask for and more. She is understanding, caring, strong, and very hard working to make the home life I enjoy today.
I am very thankful for all the wonderful people that has been my lifelong support system. My immediate and extended family. My friends, who have been there for the good and bad. Of all my friends, especially to the "Friday night" crew, you know who you are. :)
For my work, and more importantly, the absolutely fantastic, smart people it is my pleasure to work with every day. By extension being employed by a multi-national corporation, reasonably well compensated in this rough economic environment that I expect to last 10 years from now.
For where I live, a relatively insulated community surrounded by affluent towns. I hope it provides better for my family in the dark times ahead.
For technology, for my entire life has been permeated by it in every possible aspect. Technology provides for me through my job, finding my wife, for my enjoyment (gaming!), and for the information flow and framework to bring this post.
I am thankful that even though this country will be shaken to it's very foundation, to date, it remains relatively free.
For my health, and the health of my closest friends and family, with unfortunately a couple of exceptions.
And finally, for the unsung heroes that are fighting for a better tomorrow, by donating their time for our collective benefit. This includes all that have done so 100's of years leading us to today, and doing so today for a better tomorrow. Of the many people that fit this description, I am especially thankful for the financial bloggers. Mish, Karl Denninger, Gary of Smart Money Tracker, Slope of Hope, the minions on ZeroHedge, and the many financial insightful who voice their opinion on the public court. For without their efforts, we would have zero chance to be aware of the problems that we must collectively face and overcome.
Wednesday, November 23, 2011
Stansberry Investors Video on Political and Macro Economics
This video looks familiar, I believe have already posted it.
But I couldn't find the link quickly.
So here it is (again?) Video from Standberry Investors on the macro economics and politics, and a possible future.
Thanks for my brother for the forward
Monday, November 21, 2011
Wednesday, November 16, 2011
Jim Grant Speaks about global financial insanity
This Jim Grant Interview is great. I love the internet, I get so much real information about reality vs the fantasy or outright void of information provided on mainstream news.
At around 3:40 market in the video, Mr. Grant points out that mark to fantasy accounting is bad, but what is worse is the central banks have zero accountability for their own accounting.
The New York Fed is leveraged 100 to 1. MF Global, the 8th largest bankruptcy ever in the US was leverages 80 to 1 as a comparison.
Assuming thats true, why not leverage 1 googloplex to 1? Mathematically there isn't much of a risk difference, since you can be insolvent in a heartbeat if accounting was accurately measured. I just don't agree with Jim at all the insinuation that fiat currency isn't good currency. I really do hate the gold-bug mantra that shiny rocks is money. Gold as money is more draconian than the current system by a long shot.
Further, the Federal reserve will NOT take mark to market losses, but instead have a direct "running tab" with the treasury. What is the difference between US currency and Zimbabwe? Each month there is less of a difference. Currency deserves respect and STRICT rules to enforce it in spirit. Nothing less is acceptable.
Assuming thats true, why not leverage 1 googloplex to 1? Mathematically there isn't much of a risk difference, since you can be insolvent in a heartbeat if accounting was accurately measured. I just don't agree with Jim at all the insinuation that fiat currency isn't good currency. I really do hate the gold-bug mantra that shiny rocks is money. Gold as money is more draconian than the current system by a long shot.
Further, the Federal reserve will NOT take mark to market losses, but instead have a direct "running tab" with the treasury. What is the difference between US currency and Zimbabwe? Each month there is less of a difference. Currency deserves respect and STRICT rules to enforce it in spirit. Nothing less is acceptable.
Tuesday, November 15, 2011
European Crisis ahead
I am continually amazed at how incredibly irresponsible people are at their jobs and responsibilities. The European situation was obvious to me and many other bloggers years ago that they where sitting on a pile of lies. A pile that makes the USA lies look not that bad.
And here we are, day after day, month after month of the European political drama of denial and patchwork promises to stabilize the union. What have Europeans gotten for all this effort? Their (and US) tax dollars thrown at bankrupt countries, banks, and other financial institution with NOTHING done to address the root cause, excessive debt, lack of transparency, and mark to fantasy accounting.
Greece's bond rates I have published before soared. Now its spreading to Italy, Spain, Portugal, Ireland, Belgium and even France!
The leader for being the next Greece fiasco is Portugal, with soon to follow Ireland, Spain, or Italy.
Once one of these countries become the next Greece, I predict we won't have a 3rd, but a 3rd, 4th, 5th, and 6th at the same time.
Prediction: Europe is incapable of doing the right thing, as America has proven it isn't either. So we must have a European crisis. And Germany WILL buckle and print the euro just like America.
Next its a coin toss on who goes down next, China, US, or a long list of other countries.
But for those who think the US is untouchable, your just like most Europeans 1 year ago.
Once those countries buckles, then its time for the global currency crisis. I still think 2013-2018. It takes quite a while for this to play out.
And here we are, day after day, month after month of the European political drama of denial and patchwork promises to stabilize the union. What have Europeans gotten for all this effort? Their (and US) tax dollars thrown at bankrupt countries, banks, and other financial institution with NOTHING done to address the root cause, excessive debt, lack of transparency, and mark to fantasy accounting.
Greece's bond rates I have published before soared. Now its spreading to Italy, Spain, Portugal, Ireland, Belgium and even France!
The leader for being the next Greece fiasco is Portugal, with soon to follow Ireland, Spain, or Italy.
Once one of these countries become the next Greece, I predict we won't have a 3rd, but a 3rd, 4th, 5th, and 6th at the same time.
Prediction: Europe is incapable of doing the right thing, as America has proven it isn't either. So we must have a European crisis. And Germany WILL buckle and print the euro just like America.
Next its a coin toss on who goes down next, China, US, or a long list of other countries.
But for those who think the US is untouchable, your just like most Europeans 1 year ago.
Once those countries buckles, then its time for the global currency crisis. I still think 2013-2018. It takes quite a while for this to play out.
How bad off is China?
Jim Chanos, my favorite investor, spoke of a statistic I cannot correlate.
He stated that if you look at the "implicit" debt obligation is 200% of China's GDP.
Notice Chanos did not provide the same analogy for the US.
Both videos a great watch.
He stated that if you look at the "implicit" debt obligation is 200% of China's GDP.
Notice Chanos did not provide the same analogy for the US.
Both videos a great watch.
Sunday, November 13, 2011
This week without stock charts
Over the last few months or so I have become a little disturbed about the market. Europe his dire news all the time, the lack of US job growth, increasing housing defaults, increasing poverty, very large bankruptcies through fraud ( MF Global, top 10 of all time ) and other bad news.
Ignoring the press, the spin, the bloggers, everyone there are a few facts you can't ignore.
Price of gas remains high, price of gold has remained relatively strong, and other natural resource prices are not collapsing. And through this the US dollar has NOT risen like a rocket. Sure, it has gone back up compared to other currencies, but not nearly what I would have expected. After all, the news is focused on destabilization of the euro.
Throw in the market has shrugged all of this off.....what does it tell you?
My gut is telling me we maybe seeing the initial effects of monetary inflation, in a deflationary economy. And in such an environment, we'll see very odd stuff. I can't imagine being short in this environment, nor long, except natural resources.
For now I am continuing to try to sit tight, and wait for Thanksgiving weekend. Remember, congress has to come to terms with the government budget. Expect disappointment, and a possible US dollar decline. If the dollar does decline, we may see a nice market rally, contrary to popular thought.
AVL got some strength earlier in the week. Gold and silver look good, and of course gold miners.
Good luck, its an impossible scenario no matter what you chose.
Ignoring the press, the spin, the bloggers, everyone there are a few facts you can't ignore.
Price of gas remains high, price of gold has remained relatively strong, and other natural resource prices are not collapsing. And through this the US dollar has NOT risen like a rocket. Sure, it has gone back up compared to other currencies, but not nearly what I would have expected. After all, the news is focused on destabilization of the euro.
Throw in the market has shrugged all of this off.....what does it tell you?
My gut is telling me we maybe seeing the initial effects of monetary inflation, in a deflationary economy. And in such an environment, we'll see very odd stuff. I can't imagine being short in this environment, nor long, except natural resources.
For now I am continuing to try to sit tight, and wait for Thanksgiving weekend. Remember, congress has to come to terms with the government budget. Expect disappointment, and a possible US dollar decline. If the dollar does decline, we may see a nice market rally, contrary to popular thought.
AVL got some strength earlier in the week. Gold and silver look good, and of course gold miners.
Good luck, its an impossible scenario no matter what you chose.
Friday, November 11, 2011
David Rosenberg Interview on economy
Mr. Rosenberg is a well known former Merrill strategist gives a great view of the economic conditions, and investment sectors to look at.
I completely agree that a turn around must come from the politicians leading the nation.
I completely agree that a turn around must come from the politicians leading the nation.
Thursday, November 10, 2011
Steve Jobs and Life
I don't believe I even mentioned on this blog the passing of Steve Jobs.
As an IT guy, but not an Apple-ite, Jobs has been a presence in my life, indirectly affecting my daily work.
He is a rare item, a true leader in every sense of the world.
A true leader does NOT mean perfect, nice, or even civil. It means as a man he can lead others to move heaven and earth, shaping the future out of nothingness.
I read a post on Slope of Hope about Steve Jobs. It read to me as an honest assessment of Jobs and the impact on all of us. I am one of those who does not like to mix god-talk with topics. So ignoring the god references, and the statement Jobs was the best business man ever, the rant reads true.
An entertaining read from Slope of hope,
As an IT guy, but not an Apple-ite, Jobs has been a presence in my life, indirectly affecting my daily work.
He is a rare item, a true leader in every sense of the world.
A true leader does NOT mean perfect, nice, or even civil. It means as a man he can lead others to move heaven and earth, shaping the future out of nothingness.
I read a post on Slope of Hope about Steve Jobs. It read to me as an honest assessment of Jobs and the impact on all of us. I am one of those who does not like to mix god-talk with topics. So ignoring the god references, and the statement Jobs was the best business man ever, the rant reads true.
An entertaining read from Slope of hope,
Steven Paul Jobs and the Meaning of Life
Update: Thanks to bob to a nifty site recanting the experiences of working at Apple as an engineer in the early days, web site called Folklore.org
Wednesday, November 9, 2011
Where is the bull market?
The US stock market has been fairly resilient during the European debt crisis. The US dollar has risen during this crisis and held it's gains.
But so far, the US stock market has not clearly entered into a bull market, and has been trading in a range.
But there has been one area that has been resilient, price of gold, price of gas at the pump, and the price of food. The common thread of course is natural resources. Granted, all have come off their highs, but their prices have not collapsed. Sure, copper collapsed, and so did corn, but those bubbles are reflections of how strong the overall commodity market is.
I am cautiously optimistic that during the European drama, that gold maintains relative strength. This is a stark contrast to 2008, when oil hit a high and started to collapse, the entire commodity market swooned AHEAD of the market collapse.
To be clear, gold is not money, and there are no guarantees of it doing well in a Euro collapse, if that transpires. But in 2008 people looking for safety ran to USD and euro. Then when US decided to openly devalue it's currency, some ran to the Euro, driving it up significantly against the USD.
If the Euro does enter a crisis, people that got burned may not be so quick to run back to the USD, but instead into gold. And I am also following Gary of the Smart Money tracker into Gold Miners (ETF's GDX and GDXJ).
The hope being that money MUST flow somewhere in a crisis. With the US Dollar not clearly going to soar for years to come, and no one trusting China's currency there isn't many options.
Japanese Yen and USD will continue to do well I believe in the short term. Many people will flow into them, as they have done for 30 years, when looking for saftey. But the key is to look at what happens once all the people run from Euro and other currencies into USD and Yen?
Maybe, if we have a global currency collapse. But I doubt that. It is more likely when the dust settles in the Euro, the USD will have seen it's final rally, as there are no buyers left. Similar to what happened in the US stock market in 2009. But the time the S and P 500 hit 666, there where no more sellers left, only one way left is up.
By the time the USD hits the high at the Euro crisis, whenever that is (next week, next year?), there will be no more surge of buyers. Then there is only one way, down.
With gold I want a foothold BEFORE the USD hits a high, to be positioned for the finale.
Good luck.
But so far, the US stock market has not clearly entered into a bull market, and has been trading in a range.
But there has been one area that has been resilient, price of gold, price of gas at the pump, and the price of food. The common thread of course is natural resources. Granted, all have come off their highs, but their prices have not collapsed. Sure, copper collapsed, and so did corn, but those bubbles are reflections of how strong the overall commodity market is.
I am cautiously optimistic that during the European drama, that gold maintains relative strength. This is a stark contrast to 2008, when oil hit a high and started to collapse, the entire commodity market swooned AHEAD of the market collapse.
To be clear, gold is not money, and there are no guarantees of it doing well in a Euro collapse, if that transpires. But in 2008 people looking for safety ran to USD and euro. Then when US decided to openly devalue it's currency, some ran to the Euro, driving it up significantly against the USD.
If the Euro does enter a crisis, people that got burned may not be so quick to run back to the USD, but instead into gold. And I am also following Gary of the Smart Money tracker into Gold Miners (ETF's GDX and GDXJ).
The hope being that money MUST flow somewhere in a crisis. With the US Dollar not clearly going to soar for years to come, and no one trusting China's currency there isn't many options.
Japanese Yen and USD will continue to do well I believe in the short term. Many people will flow into them, as they have done for 30 years, when looking for saftey. But the key is to look at what happens once all the people run from Euro and other currencies into USD and Yen?
Maybe, if we have a global currency collapse. But I doubt that. It is more likely when the dust settles in the Euro, the USD will have seen it's final rally, as there are no buyers left. Similar to what happened in the US stock market in 2009. But the time the S and P 500 hit 666, there where no more sellers left, only one way left is up.
By the time the USD hits the high at the Euro crisis, whenever that is (next week, next year?), there will be no more surge of buyers. Then there is only one way, down.
With gold I want a foothold BEFORE the USD hits a high, to be positioned for the finale.
Good luck.
Sunday, November 6, 2011
Where should your money be?
I am not going to endorse or reject this video. I think it is worth readers to watch, and give thought to the content. At the very least, it was interesting to see how they used the movie It's a Wonderful Life to make their point.
At the end, it refers you to the web site Move Your Money for more information.
As food for thought, check out youtube and surf, I found this one, all interesting.
At the end, it refers you to the web site Move Your Money for more information.
As food for thought, check out youtube and surf, I found this one, all interesting.
Saturday, November 5, 2011
Lost Power
As some of you have heard, the NJ area was hit hard with an early snow.
I was without power from Tuesday until Thursday. Between that and being in a wedding Saturday, I didn't have time to post. I should have time this week.
I was without power from Tuesday until Thursday. Between that and being in a wedding Saturday, I didn't have time to post. I should have time this week.
Tuesday, November 1, 2011
Greece destabilizing fast, time for European meltdown?
Greece is destabilizing fast. Greek prime minister George Papandreou replaced the top brass in Army, Navy, and Air Force in a surprise move. This is following another surprise move by announcing holding a public vote on EU bailout agreements, as soon as next week.
Government Greek 1 year bonds now pay a return of 205%!!!
If you bought 10,000 euros of Greek government 1 year bonds, in 1 year, the bond will be worth 30,000 Euros!
The current proposed plan is to cut bond debt by 50%. So if the 10,000 euros turned to 5,000 Euros, in 1 year it would be worth 15,000! Still a 50% gain for 1 year in bonds.
It should be obvious that this is not risk free. There is a reason why the rates are so high.
Because the government is destabilizing and you may get ZERO return on your bonds.
And if Greece falls, expect Spain, Portugal, Italy, and Ireland to be not too far behind.
If Europe enters into a classic deflationary collapse, which is once again it is looking to be, the entire market could get a big flush.
Good luck. We live in truly historic times.
Government Greek 1 year bonds now pay a return of 205%!!!
If you bought 10,000 euros of Greek government 1 year bonds, in 1 year, the bond will be worth 30,000 Euros!
The current proposed plan is to cut bond debt by 50%. So if the 10,000 euros turned to 5,000 Euros, in 1 year it would be worth 15,000! Still a 50% gain for 1 year in bonds.
It should be obvious that this is not risk free. There is a reason why the rates are so high.
Because the government is destabilizing and you may get ZERO return on your bonds.
And if Greece falls, expect Spain, Portugal, Italy, and Ireland to be not too far behind.
If Europe enters into a classic deflationary collapse, which is once again it is looking to be, the entire market could get a big flush.
Good luck. We live in truly historic times.
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