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05.22.12- Jamie Dimon: Born-Again Banker?
As we watch the absurd melodrama surrounding JP Morgan's multi-billion dollar "trading loss" unfold before us, there are many things we still don't know. However there is one thing we do know: that the truth is totally different than what is being depicted by JP Morgan and the talking-heads of the mainstream media. To understand that this is pure financial farce requires putting numbers into perspective. Let's start with this one: JP Morgan's derivatives portfolio alone amounts to more than $70 trillion in highly-leveraged, ultra-risky bets. That is the amount JP Morgan admits to. Thus whether we are talking about a "$2 billion" trading loss or the $4-5 billion figure now being rumored is irrelevant. These are trivial numbers. Read More |
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05.21.12- If the Euro Ends, So Will the World as We Know It?
Robert Chote, the head of the Office of Budget Responsibility for the British Tory regime, claims the "British economy may never quite recover from a severe Euro collapse." According to a UK Telegraph article, "Britain's economy may suffer 'permanent' damage and 'never quite get back up' if the euro collapses in a chaotic way. This, according to the "Government's chief economic forecaster." So much for the idea that Britain's right-wingers are dead set against the EU or the euro. Smell the fear? The elites use dominant social themes – fear-based promotions – to push for world government. This comment from Chote is right in line with that. Read More |
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05.19.12- "The Truth Gets Out Eventually" 
Some look at today's FaceBook IPO flop, the ongoing market rout, and the situation in Europe with disenchantment and disappointment. We, on the other hand, view it with hope: because more than anything, the events of the past few days show that the truth is getting out - the truth that capital markets simply can not exist under the authoritarian rule of central planners, the truth that the stock market is a casino in which the best one can hope for a quick flip, and finally the truth that our entire socio-economic regime, whose existence has been predicated by borrowing from the uncreated wealth of the future, and where accumulated debt could be wiped out at the flip of a switch if things go wrong in the process obliterating the welfare of billions (of less than 1%ers), is one big lie. We believe that hope is what SocGen's Dylan Grice is what he has in mind when he penned the following conclusion to his most recent piece: La Grande Illusion. Read More |
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05.18.12- The Bank Runs In Greece Will Soon Be Followed By Bank Runs In Other European Nations
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05.17.12- Europe's Plan B, Greek Bank Runs, and Why We Need New Sunglasses
The words were spoken by many; Juncker, the German Finance Minister, Merkel, Barroso, Monti and you can just keep going. They all said the same thing about the Greek PSI, “This is the best and final offer.” Each intonation was made with great moral suasion; each speech was directed toward the world’s institutional investors as we were reminded again and again that there was no “Plan B.” In the end most money managers swallowed the bitter pill, given such forceful pronouncements and took the deal offered on the $261 billion swap only to watch the value of the new bonds sink into horizon but no choice was given so there was nothing else, really, that could have been done. Read More |
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05.16.12- JPM Chase Chairman, Jamie Dimon, the Whale Man, and Glass-Steagall
It was fitting that while President Obama and his Hollywood apostles broke fundraising records at a sumptuous $40,000 per plate dinner at George Clooney’s place, word of JPM Chase’s ‘mistake’ rippled through the news. Not long ago, Dimon’s name was batted about to become Treasury Secretary. But as lines are drawn and pundits take sides in the Jamie Dimon ego deflation saga – or, as I see it - why big banks should be made smaller and then, broken up into commercial vs. speculative components ala Glass Steagall – it’s important to look beyond the size of the $2 billion dollar (and counting) beached whale of a trading loss. Yes, $2 billion in the scheme of JPM Chase’s book and quarterly earnings is tiny, a ‘trading blip’ as it’s been called by some business press. Read More |
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05.15.12- The Suspicious Growth of the Financial Industry 
Societies become more complex as they age. Each challenge…or opportunity…is met with a new rig of some sort. A tax. A regulation. An organizational fix. As time goes by, these fixes act like friction…they slow the machine. They make it hard to move…inflexible and unresponsive. And over time, more people gain access to a fix — each lobbying group and special interest, each with his own bailout or subsidy…and each desperate to hold onto it. Output is thus shifted to unproductive activities. The real producers are punished — with taxes and regulations — while unproductive activities are rewarded, with bailouts, handouts and sweetheart deals. Read More |
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05.14.12- Treasuries and Derivatives Blow Up? So Where Do You Go...
Here's some interesting news along the lines of "man bites dog." According to a recent Reuters article, US financial advisors are actually growing leery of US Treasury bonds. This is almost unheard of and one could certainly make a case that it is a sign of most unsettled times. Ordinarily, financial advisors, especially those in the US, are disposed to provide Treasuries for most every ill. They are seen as repositories of value, security and liquidity – and this perspective has been preached relentlessly to the average US consumer. And yet now we now find a much different perspective, being reported by Reuters: Read More |
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05.12.12- The 2 Billion Dollar Loss By JP Morgan Is Just A Preview Of The Coming Collapse Of The Derivatives Market
When news broke of a 2 billion dollar trading loss by JP Morgan, much of the financial world was absolutely stunned. But the truth is that this is just the beginning. This is just a very small preview of what is going to happen when we see the collapse of the worldwide derivatives market. When most Americans think of Wall Street, they think of a bunch of stuffy bankers trading stocks and bonds. But over the past couple of decades it has evolved into much more than that. Today, Wall Street is the biggest casino in the entire world. When the "too big to fail" banks make good bets, they can make a lot of money. When they make bad bets, they can lose a lot of money, and that is exactly what just happened to JP Morgan. Read More |
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05.11.12- Marc Faber Sees A 1987-Like Crash Approaching
When given the opportunity to expand on his thoughts, Marc Faber, of the Gloom, Boom, & Doom Report, provides dismally clarifying detail on the state of the world. In this excellent (must-watch on a day when nothing changed but European stocks dead-cat-bounced) Bloomberg TV interview, the admittedly ursine Faber reflects on the US (slowing of revenue growth and the real linkages to European stress) noting that unless we get a huge QE3, there will be "a crash, like in 1987" noting he believes we have seen the highs for the year; on the likelihood of QE3 (agreeing with us that the Fed won't act unless asset markets plunge first); on Greece's exit of the Euro and whether policy-makers can manage the exit properly "bureaucrats in Brussels and the media are brainwashing everybody that if Greece exited the euro, it would be a disaster. My view is the best would be to dissolve the whole euro zone". Read More |
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05.10.12- Protecting Your Assets from an Out-of-Control Government, Part I
By keeping all your assets in the country where you live, you commit, ahead of time, to ratify whatever policy your home government might adopt, no matter how objectionable, unreasonable or pernicious that policy happens to be. If the next new mandate is “Register today to get a nail pounded into your head,” you’re already signed up. Americans, by and large, run all their affairs within the confines of the US. The US economy is so large and so varied that it’s easy to assume that everything you want to do with your wealth can be done without crossing any borders. And people in the US, like people anywhere, live with the habits and attitudes developed over generations. They’re only human. Read More |
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05.09.12- Stick to Depopulating the Planet, Bill Gates
It must be “Bash Gold” week on the CNBS network. Warren Buffet has been leading the charge by talking down the precious metal in a recent newsletter to Berkshire Hathaway shareholders and followed up today on CNBS’s “Squawk Box” where he warned that despite the declining value of the dollar, running to gold is a “mistake.” Not to be outdone, Buffet’s partner in crime Charlie Munger recently declared “gold is a great thing to sew onto your garments if you’re a Jewish family in Vienna in 1939 but civilized people don’t buy gold – they invest in productive businesses.” And now, Bill Gates went on CNBS today to try and explain the great error in investing in the barbarous relic. It’s like they’re trotting out the billionaire boys club to scare people back into Berkshire and Microsoft stock. Read More |
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05.08.12- It’s Official: 
There has been so much bad economic news out, recently, I do not see how anyone with half a frontal lobe could say the economy is not in trouble. Friday, new unemployment figures were announced, and a weak 119,000 jobs were created. The rate fell to 8.1%, but only because more discouraged workers stopped looking for work and disappeared from the government’s data base. In Friday’s report, economist John Williams of Shadowstats.com summed it all up by saying, “The headline U.3 unemployment rate dropped a statistically insignificant notch to 8.1% in April, from 8.2% in March, but the “good” news was anything but good. The declining pace of headline unemployment reflected an accelerating increase in the number of the headline unemployed giving up looking for work, because there were no jobs to be had. . . . The SGS-Alternate Unemployment Measure, accordingly, notched higher in April to 22.3%, from 22.2% in March.”So, unemployment in the real world actually went up—not down. According to outplacement firm Challenger, Gray & Christmas, planned job cuts rose 7.1% in April, and more than 40,000 more workers are going to be laid off. Read More |
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05.07.12- Black Monday for global financial markets? 
A perfect storm is brewing for financial markets on Monday with the European election results likely to be the tipping point after the worst week for the S&P 500 this year. Elections in France Germany and Greece are being keenly watched. Austerity politics is going to be voted out and that is all that is supporting fragile financial markets. QE3 and LTRO Expect the Fed and ECB to strike back with money printing operations again. The problem is that the impact on the real economy, as we saw in the appalling US jobs data on Friday, is that this action is less and less effective. Read More |
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05.05.12- Investors dumped equities in April fastest in 17 years, will they now turn to gold and silver? 
Global investors pulled the most out of stock funds in April since at least 1996 when records began. Equity funds posted net redemptions of $18.6 billion through to April 25th, according to data from EPFR Global. The shift out of equities has been a long-term trend since the global financial crisis of 2008, despite the subsequent rally that took stocks above pre-crash levels. Mutual funds that buy US stocks suffered withdrawals of $121 billion in the year to end of March, reported Morningstar, while bond funds recieved $191 billion over the same period. Read More |
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05.04.12- What If A Collapse Happened And Nobody Noticed? 
Every once and awhile I'll be listening to a podcast with one or the other writers specializing on the subject of Peak Oil or collapse and the subject of timetables will come up. When will the collapse finally be here, the callers ask insistently, almost pleadingly, so that they can finally justify their investments in freeze-dried foods, water purification tablets and solid gold coins. Inevitably the guest will demur, and speak more in general terms. But I'm going to be the first pundit to go out on the limb and assign a timeline for the collapse. Spread it far and wide, and let's see just how good my predictive powers are. Are you ready? Here it is: Right now... What do they think a collapse is supposed to look like? Read More |
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05.03.12- The Obama Recovery Persists At Least Until After the Election ...
U.S. Manufacturing Grows at Fastest Pace in a Year ... Manufacturing grew in April at the fastest pace in almost a year, propelled by a pickup in orders that signaled factories will remain a source of strength for the U.S. expansion. The Institute for Supply Management's factory index climbed to 54.8 last month, exceeding the most optimistic forecast in a Bloomberg News survey and the best reading since June, the Tempe, Arizona-based group's report showed today ... The world's largest economy may pick up after slowing in the first three months of the year as the increase in bookings indicates American assembly lines will keep churning out more goods. Combined with a report showing manufacturing in China also accelerated, the figures sent the Dow Jones Industrial Average to the highest level since 2007 as the data eased concern global growth was slackening. – Bloomberg Read More |
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05.02.12- Preparing for a Lengthy and Unpredictable US Dollar Crisis
“On the threshold of a crisis,” we observed in our essay “Investing Ahead of the Curve” in the July 19, 2011 edition of The Daily Reckoning, “a fertile imagination can be an investor’s most valuable asset.” “During normal times,” we continued, “investors can focus only on buying quality stocks one by one from the bottom up, without also trying to envision what tragedies might befall them from the top down… But it may be time to begin imagining the unimaginable. “It may be time, in other words, to begin considering that the next phase of the global monetary system might not include the US dollar as its reserve currency…or that the next two decades of life in America might not look anything like the last two decades.” Read More |
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05.01.12- Final High 2012 For Stocks & Economy
It's amazing sometimes how much difference a year can make on investor psychology. For most of last year investors worried incessantly about a potential "double dip" U.S. recession and the possibility of another worldwide credit crisis beginning in Europe. Fast forward to 2012 and those worries have mostly evaporated from investors' minds. The consensus now is that the economy has improved and corporate earnings will continue to increase. The biggest worry for most investors is where they can achieve the biggest dividend yield while the Fed continues to artificially hold down bank interest rates. They further believe that the bull market that began in March 2009 will continue to achieve higher stock prices into 2013. Read More |
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04.30.12- Risky Investments in a Market Full of Conmen
Dow up more than 100 points yesterday. Gold up $18. Google…Apple…what more do you need to know? “Blah, blah, blah…don’t you feel you’re wasting your time?” Our friend was being sympathetic. She gave us a look of pity, tightly controlling her face muscles; as if it might slide into contempt at any moment. After spending so much time with rocks, dirt, cement…cattle, grapes…doing such real things, we admitted that writing about economics and finance seemed a little light. As if there is nothing real there. “I mean, you were building things…changing the landscape…and improving people’s lives. Putting water in their houses…digging reservoirs…setting up solar power systems.” Read More |
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04.28.12- A Basket of Goodies to Suggest Gold is Set to Break New Highs 
Over the past weekend, China announced that they would purchase Iranian oil through sale of gold beyond June 28 2012 in order to get around US sanctions that states no nation can sell oil in US Dollars This has profound implications going forward, as this will be the first time in nearly 70 years that the US Dollar as a reserve currency has been challenged. The BRICS nations have primarily been the target of sabre rattling through the US government, so actions taken by China is likely to be conducted on a massive scale going forward as other nations seek better control over their own destiny. Read More |
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04.27.12- Too Stupid to Think, Too Paralyzed to Act
Many years ago when I was a teenager, my late father had a friend who was in his sixties. His name was Johnny and he was overweight. He was in conversation with my father one day when he started complaining how his fluctuating and ballooning weight required him to buy bigger pants every few months which in turn then required him to look through his wardrobe to find the pants that would fit him as his weight went up and down. Read More |
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04.26.12- House Prices and Oil 
IF THERE is one asset that the world has little use for, writes Gregor Macdonald, it is an American single family home priced above $250K, reachable only by car. Why rising oil prices could weigh on some real estate values... The great, post-war buildout of America's suburbs relied upon the continuance of a favorable arbitrage between rising wages, and low transportation costs. Now that this profitable scheme has come to an end, it should be no surprise that Robert Shiller remarked this week that housing "may not recover in our lifetime." While some stabilization has been seen since the start of the US housing bust, Case-Shiller data showed this week that many cities hit new price lows. Interestingly, Robert Shiller is now himself noting the energy and transport cost pressure on US housing, and used the phrase "walkable cities." Read More |
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04.25.12- Investors buying sovereign debt rather than gold
It seems that investors have shrugged off the latest developments around the world, in particular the Eurozone and are looking for direction from the US Federal Reserve. In the meantime, gold prices struggle for a firm direction as investors remain on the side-lines awaiting the next event that will propel prices upward. However, the events are unfolding right before their eyes, even though prices continue to trend slightly lower. After an April 20 meeting during the IMF-World Bank Spring Meetings in Washington, a joint statement issued by the G-20 and the IMF's policy-setting International Monetary and Financial Committee (IMFC) said there are firm commitments to increase resources available to the IMF by more than $430 billion. The statement added that these resources will be available for the whole membership of the IMF and not earmarked for any particular region. Read More |
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04.24.12- Politics, Markets, and People: On a Collision Course
The world is clearly on a collision path, ideologically, economically, and philosophically. And the markets are starting to reflect this. The story of the weekend is Wal-Mart's bribery scandal. But Europe is about to head on another down leg as Spain's economy is shrinking and the European Central Bank is not interested in another round of money printing or bond buying. As we reported last week, European banks are already running out of the money that was put in their pockets by the LTRO bond buying arrangement with the ECB. So Monday is a major potential disaster about to happen. Read More |
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04.23.12- As If Nothing Matters
The world gave the appearance of doing nothing and going nowhere over the past month - apart from the sensational liaison of Kim Kardashian and Kanye West, which, some believe, augurs a dazzling speed-up of the much prayed-for economic recovery, return to full employment, $2.50 gasoline by summer, and the selection of Jesus Christ as VP running mate by Mitt Romney - but, in fact, so much trouble is roiling under the surface all over the world that it makes you feel seasick on dry land. It is true that the European financial fiasco is a story of such fantastic mystifying complexity that the public can't possibly be expected to follow each twist of the plotline. But the fact is that nothing was fixed for Greece or after Greece and the hazard of evermore profound wreckage is assured. Read More |
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04.21.12- Après Moi, le Déluge
If history has taught one certain lesson, it is that the less fettered an economy, the better humankind is able to do what it does best: run from trouble and run toward opportunity. In this way mistakes are quickly resolved and progress assured. Conversely, the deeper the muck of regulation, mandates, taxes, subsidies and other bureaucratic meddling, the slower we humans are in following our natural instincts until the point that progress is slowed or even stopped. It is said that history doesn't repeat itself, but it often rhymes. In the current circumstances, it appears that enough time has passed that current generations have completely forgotten the critical connection between the ability of humans to freely pursue their aspirations and economic progress. Read More |
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04.20.12- China’s Rise, America’s Fall
The rise of China surely ranks among the most important world developments of the last 100 years. With America still trapped in its fifth year of economic hardship, and the Chinese economy poised to surpass our own before the end of this decade, China looms very large on the horizon. We are living in the early years of what journalists once dubbed “The Pacific Century,” yet there are worrisome signs it may instead become known as “The Chinese Century.” In a recently published book, Why Nations Fail, economists Daron Acemoglu and James A. Robinson characterize China’s ruling elites as “extractive”—parasitic and corrupt—and predict that Chinese economic growth will soon falter and decline, while America’s “inclusive” governing institutions have taken us from strength to strength. Read More |
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04.19.12- How Long Before America 
Decades of manipulation by the Federal Reserve (through its creation of paper money) and by Congress (through its taxing and spending) have pushed the US economy into a circumstance that can't be sustained but from which there is no graceful exit. With few exceptions, all of the noble souls who chose a career in "public service" and who've advanced to be voting members of Congress are committed to chronic deficits, though they deny it. For political purposes, deficits work. The people whose wishes come true through the spending side of the deficit are happy and vote to reelect. Read More |
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04.18.12- The Malign Power Of Bad Ideas
According to economic historian Angus Maddison, Latin America had six among the world’s 30 richest economies in 1900. Today the continent’s richest country, by purchasing power parity GDP per capita, is Argentina, at No. 55, according to the International Monetary Fund. Yet the continent is not short of natural resources, not overpopulated, and avoided the catastrophic carnage of World Wars I and II. The Mexican author Enrique Krauze’s “Redeemers – Ideas and Power in Latin America” suggests strongly that the continent’s sad decline was due to the power of bad ideas. Latin America’s economic management during the nineteenth century was mixed, with considerable outbreaks of turbulence, but at the top end it wasn’t bad at all. Read More |
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04.17.12- "Sic Transit Gloria Pecuni" - LME Considering Ending Sterling, Allowing Renminbi Settlement
On a long enough timeline, all things come to an end. Even for such venerable venues as the London Metals Exchange, with its 130 year history, and its annual turnover of over $11 trillion in metal contracts, which also makes it the largest market for non-ferrous metals. As the English FT reminisces, "When the LME was established in 1877, Britain was one of the world’s most important manufacturing powerhouses, and the LME’s benchmark contracts for delivery in three months were designed to mirror the length of time needed to reach British ports for shipments of copper from Chile and tin from Malaysia." Read More |
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04.16.12- Why Has the American Economic System Failed, and What Are We Going To Do About It?
"We always want to keep in mind what the function, the purpose, of the economy is. The purpose of an economy is not producing GDP. It is increasing the welfare of citizens, and it is increasing the welfare of most citizens. And the American economic system has failed, and failed very badly. Most Americans today are worse off, most American households have lower real income adjusted for inflation than they had fifteen years ago." Joe Stiglitz made an aside about half way through his talk about mercantilism at INET Berlin this month that is worth noting.Although he initially addresses it to America, he goes on to include other countries, especially Germany. I would add the UK, among others. Read More |
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04.14.12- The Rising Price of a 
Do you know why oil and prices are moving sharply higher? Some blame the oil companies, charging they are manipulating prices. Others cite US sanctions on Iran and the threat of a military encounter that would disrupt the flow of oil from the Middle East. Speculators, too are blamed for ostensibly bidding up the price of oil. In the political arena, President Obama is taking credit for increased domestic oil production even as his critics point out the slow pace of drilling permits issued by his Administration soon will hamper additional increases in the US oil production. Yet, the basic reason for higher energy prices is being overlooked, even though it is right before our eyes: Oil prices are up because the value of the dollar is down. Read More |
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04.13.12- Green Slime Drives our Financial Crises
Pink slime” just had its fifteen minutes of fame. BPI, the producer of pink slime, calls it “Lean Finely Textured Beef.” BPI’s slogan is “expect a higher standard.” Pink slime starts with fatty tissues that are inherently more likely to be repositories of salmonella and e coli infections. The tissues are shredded and rendered and most of the fat drained off. The pink slime, however, is still more likely to be infected after this processing and that makes it dangerous and can make it smell spoiled. BPI’s “innovation” was to gas the pink slime in Mr. Clean (ammonia) to try to kill bacteria and reduce the stink. The resultant pink slime is then frozen into bricks and shipped in bulk. Pink slime was originally limited to dog food, but it has secretly been fed to Americans for a decade. Major hamburger chains, grocery stores, and school lunch programs added it to make up 15% of our burgers. The government didn’t require disclosure of pink slime or ammonia. Read More |
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04.12.12- Should Corrupt Bankers Face the Death Penalty?
Let’s be clear: financial misdeeds ruin lives. If a Madoff takes your money and uses it to pay off other investors in a ponzi scheme, you won’t be able to get it back. If a Blankfein underling issues you with misleading advice, and then bets against you (creaming himself a nice profit), you won’t be able to get it back. If a Corzine steals your money and uses it to bet on the European sovereign debt market, you might not be able to get it back. You might end up in poverty or worse. You might lose your children’s college money, your retirement money, or capital you needed for your business. You might lose your home. So shouldn’t we take a tough line against financial misdeeds? Shouldn’t tricking and stealing from investors, tricking and stealing from the public, tricking and stealing from clients carry a heavy disincentive, like death? Would a corrupt banker not think twice about their misdeeds if they knew that apprehension would mean a noose around their neck and a kicked bucket? Read More |
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04.11.12- An Economic Quagmire
A poor jobs report, higher than expected inflation in China, and another flare-up in the Eurozone sent stocks tumbling on Monday. US Treasuries rallied on news from the Labor Department that employers added just 120,000 non-farm payrolls in March, far below analysts most pessimistic predictions. The Dow Jones lost 130 points on the day, while 10-year Treasury yields slipped to Depression era levels of 2.03 percent. After three-and-a-half years of zero rates, $2.3 trillion in quantitative easing, and $4.4 trillion in additional bond sales (USTs), a “sustainable” recovery is still nowhere in sight. Friday’s BLS report was not entirely unexpected. TrimTabs analyst Madeline Schnapp explains what’s behind the sudden drop in new jobs from 200,000 per month (for 3 months) to just 120,000 on Friday: Read More |
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04.10.12- Spain Will Exit The Eurozone First—This Year
This post is adapted from a piece that originally appeared at my Strategic Planning Group. I've been doing a lot of work over there—hence the scarce postings over here. Sorry! GL In the LiraSPG Scenario “When The Euro Breaks”, I discussed what would happen to the euro and the eurozone when those countries—unable to continue under their massive debt burdens—began exiting the European monetary union.One of the assumptions I made was that one of the smaller nations of the eurozone would leave the monetary union first, thereby encouraging one of the bigger nations to follow their example and leave as well. I postulated that the small country would likely be Greece, and that the large country would probably be Spain. Read More |
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04.09.12- There Will Never Be A Failed US Treasury Auction... Until There Is
"The antidote to hubris, to overweening pride, is irony, that capacity to discover and systematize ideas. Or, as Emerson insisted, the development of consciousness, consciousness, consciousness." -Ralph Ellison "Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one." -Charles Mackay Asymmetric Trades One thing I've learned from my 14 years of working on Wall Street is that no matter how much you think you know, no matter how certain you are of something or how well you know how to "play the game," reality inevitably comes along and shows you just how ignorant you were, are and probably always will be. Read More |
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04.07.12- Peak Exorbitant Privilege
Importing more than you export means lots of empty containers.That visual manifestation of our trade deficit is what drivers see as they pass the Port of New York and New Jersey on the New Jersey Turnpike. In the first eight months of 2010, the port saw the equivalent of 700,000 more full 20-foot containers enter than leave. |
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04.06.12- And Now, for Something Entirely Different:
Meet the 101 most useful websites on the Internet. The list highlights all the lesser-known websites that are worth bookmarking. As we approach the dawn of a new year, here are my picks for the 101 most useful websites of the year 2011. Useful Websites Worth a Bookmark! The sites mentioned here, well most of them, solve at least one problem really well and they all have simple web addresses (URLs) that you can easily learn by heart thus saving you a trip to Google. Read More |
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04.05.12- Silver’s Trend & the Death of Technical Analysis 
The death of technical analysis has arrived. What took place in the markets (especially in the precious metals) on April 3rd & 4th proves this in spades. There were several calls made prior to the takedown, by some very well known individuals in the precious metal field, that became NULL & VOID when either bottoms or chart patterns failed. I am not going to name names, but I would imagine those who have been following the gold and silver markets for quite some time, know who I am talking about. That being said, I don’t blame them one bit. Trying to make short term calls based on technical analysis presently has become nearly impossible when the markets are constantly manipulated. I think it is time that we all just realize a monkey throwing a dart at a trend line on a wall is just as useful as short term technical analysis. Read More |
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04.04.12- Budget War Threatens America’s Survival
President Barak Obama gave a speech to newspaper executives about the recently passed Republican budget in the House of Representatives. It proposes to cut spending by more than $5 trillion over the next ten years. Yesterday’s speech was, basically, a declaration of war against the GOP and its vision of the government’s budget. The President said, “This Congressional Republican budget is something different altogether. It is a Trojan horse disguised as deficit reduction plans. It is really an attempt to impose a radical vision on our country. It is thinly veiled social Darwinism. It is antithetical to our entire history as a land of opportunity and upward mobility for everybody who is willing to work for it. A place where prosperity doesn’t trickle down from the top but grows outward from the heart of middle class.” Read More |
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04.03.12- Collapse
Collapse is an overused word, a telescoping of events better described as a decline. The buggy industry didn't "collapse" when the first automobile dealership appeared—Studebaker made both, nor did the vacuum tube disappear the day the first transistor was manufactured. The Roman and Byzantine empires didn't collapse, they were transformed in a surprisingly orderly, if not voluntary, manner over a long period of time. No, they weren't mere reorganizations or downsizing, and yes there were catastrophic events within those episodes, but a critical observer of the time would would rightly understand them to be something other than collapse. Read More |
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04.02.12- The Decline And Fall
In our previous article we looked at whether the U.S. Dollar was headed for a major fall or not. We demonstrated how the dominance of the U.S. dollar was almost entirely dependent on the grip it had over oil producers and this allowed the oil price to be disseminated in the U.S. dollar. The U.S. has gone to war in Kuwait and Iraq over this issue under the guise of destroying "weapons of Mass Destruction" as it appears on the verge of doing in Iran. It is no coincidence that Iran has long since ceased using the dollar to price its oil. It has also eliminated the U.S. dollar from its reserves. But of greater importance to the emerging world has been the use of the Belgian-based SWIFT system of international settlements. Not only has the move stopped the sale of Iranian oil, but it has also interfered with an important source of oil to the emerging world. Read More |
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The bank runs that we are watching right now in Greece are shocking, but they are only just the beginning. Since May 6th, 
