Wednesday, April 28, 2010

PLAY IT AGAIN SAM update II

Look for the ramp job to continue in spite of the kabuki theater. The masses were thrown their red meat and the senators all went home and guzzled Budweiser, ate caviar, and watched American idol...they had done their duty and it was time to self-indulge. After all, thats why they had taken that thankless job. You know....to help bring a better way of life.......to themselves of course. That little bit of untidy business was over and now they could get back to the real work of the Senate...preventing some of the rathscallions in the house of representatives from having a voice in real reform of a broken country and its financial system.

Whats funny to this observer is that the real reform if waiting patiently down the road as the kabuki theater bus rolls merrily along toward its fate. Do I know when nature will exact its pound of flesh? Of course not. But I do know we are closer today than we were a year ago.

I cannot emphasize enough why you must own physical gold.

Watch the miners here as usual they are in the crossroads short term and intermediate....long term you are fine if you get "stuck" on a trade if you are retail.I am gambling this morning on a lil greek bank so gl gang.

April 28 (Bloomberg) -- Gold fell in London on speculation economic growth will erode demand for the precious metal as an alternative asset.

Federal Reserve officials today may indicate the U.S. recovery is strengthening. Gold rose to a four-month high yesterday after Standard & Poor’s lowered Greece’s and Portugal’s credit ratings, spurring demand for the metal.

“In the short term, there may be safe-haven buying, but I don’t think that will be as important in the weeks ahead,” said Daniel Smith, an analyst at Standard Chartered Plc in London. “The Greece issue won’t derail economic recovery.”

Gold for immediate delivery dropped $4.85, or 0.4 percent, to $1,163 an ounce at 11:30 a.m. local time. The futures for June delivery were little changed at $1,163.30 on the Comex in New York.

Goldman Sachs Group Inc. said it reduced its gold forecasts because of expectations that a “broadening economic recovery” will lead to higher U.S. interest rates.

Gold will average $1,165 an ounce this year and $1,350 in 2011, Eugene King, Peter Mallin-Jones and Andrew Byrne said in a report dated yesterday. In January, the company’s forecasts were $1,265 an ounce for 2010 and $1,425 an ounce for 2011.

The dollar rose against the euro for a second day today. Gold usually moves in the opposite direction to the dollar.

The Federal Open Market Committee plans to issue a policy statement at around 2:15 p.m. today in Washington. The morning “fixing” of gold, the price used by some mining companies to sell production, rose to $1,164.25 an ounce from $1,149.50 at yesterday’s afternoon fixing

update I at 1319 edt....FOMC TEXT

http://www.marketwatch.com/story/text-of-fomc-statement-2010-04-28

update II April 28 (Bloomberg) -- Gold futures rose to the highest price since December on signs of increased demand for the precious metal as an alternative to holding currencies.

Gold priced in the euro, sterling and the Swiss franc extended rallies, rising to records for a second day after Spain’s credit rating was cut by Standard & Poor’s. Yesterday, S&P lowered its credit ratings for Greece and Portugal, sparking concern that Europe’s sovereign-debt crisis will threaten a global economic recovery.

“You’re seeing a general attraction to gold on a worldwide basis,” said Stephen Platt, a commodity analyst at Archer Financial Services Inc. in Chicago. “The sovereign-debt panic is spreading and forcing a flight to quality into gold.”

Gold futures for June delivery rose $9.60, or 0.8 percent, to $1,171.80 an ounce on the Comex in New York, after touching $1,175.30, the highest price since Dec. 4.

Holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, expanded for a second day to a record 1,146.83 metric tons yesterday, according to figures on the company’s Web site.

Economists at Goldman Sachs Group Inc., JPMorgan Chase & Co. and Royal Bank of Scotland Group Plc said that European policy makers may need to come up with as much as 600 billion euros ($794 billion) in aid or buy government bonds if they are to stamp out the region’s spreading fiscal crisis. The financial turmoil in Europe has dragged down the 16-nation currency 8.3 percent this year against the dollar.

Store of Value

Investors concerned that governments will have to monetize their debt are turning to gold as a store of value, said Bart Melek, a commodity strategist at BMO Capital Markets in New York.

“There is the risk that some money will have to be printed and that means a reduction in purchasing power,” Melek said.

Tuesday, April 27, 2010

TUESDAY NOISE DAY update I

Should be some nice theater today as Lloyd testifies for show today. The Senators can beat him up (professionally mind you) then tell the public that they are going to create transparency in a system that has never seen transparency. After all how do you think we were able to dump our toxic financial waste on all the foreign entities. It bought us the delusion (at least for a few years) that we were able to afford to fight two overseas wars, buy an escalade for every driveway, a Mc mansion with a three car garage for the driveway, shop at Sac's for jeans, on 90K a year with NO tax increases while the deficits and debt ran through the ceiling. NEXT....

TOKYO, April 27 (Reuters) - Gold edged up on Tuesday, nearing
a one-week high marked the previous day as a halt in the euro's
decline provided support, while focus is on the Federal Reserve's
two-day policy meeting starting later in the day. FUNDAMENTALS * Spot gold XAU= inched up to $1,155.35 per ounce as of
2355 GMT, compared to $1,153.38 per ounce in New York. * It hit an intraday high of $1,159.73 on Monday, its highest
since April 15, but came under pressure as the euro fell on
uncertainties about an aid deal for debt-ridden Greece. * On Monday, euro-priced XAUEUR=R gold hit a record high of
868.57 euros, bolstered by the combination of risk-averse buying
and euro weakness. Gold in euro terms stood at 862.43 euros an
ounce on Tuesday. * U.S. gold futures for June delivery GCM0 were up 0.2
percent at $1,155.80 per ounce, compared to the settlement of
$1,154 on the COMEX division of the NYMEX. * The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust (GLD), said its holdings rose to a record of
1,146.216 tonnes as of April 26, up 6.088 tonnes from the
previous business day. [GOL/SPDR] * The International Monetary Fund sold 5.6 tonnes of gold in
February under the second phase of its gold sales programme, the
World Gold Council said in a report on Monday. [ID:nLDE63P2C3] MARKET NEWS * Investor confusion on the timing and amount of emergency
aid for Greece prompted euro selling on Monday as markets worried
whether the euro zone country can avert a debt default. [USD/] * Germany said on Monday it could offer aid for Greece within
days if it agreed to painful new austerity measures.

http://news.goldseek.com/ClifDroke/1272264540.php

update I....and then there wuzz FEAR

(Reuters) - Gold hit two-week highs on Tuesday and record peaks in euros and Swiss francs, as ratings downgrades of Portugal and Greece fanned sovereign risk fears in the euro zone, helping the metal shrug off weakness in the euro.

Spot gold hit a peak of $1,163.75 and was bid at $1,161.95 at 1525 GMT, against $1,153.38 late in New York on Monday. It hit record highs in euros at 874.70 euros an ounce and in Swiss francs at 1,254.87 francs.

Standard & Poor's downgraded Portugal's ratings on concerns about its ability to deal with high debt levels. Portuguese bond spreads hit euro lifetime highs as investors feared the country was the next weak link in the euro zone after Greece.

"Gold prices are rising on the back of presumably higher sovereign risks in the euro zone after the latest downgrade of Portugal ratings by S&P," said Commerzbank analyst Eugen Weinberg.

"Gold seems to be defying the traditional pattern - stronger dollar, lower gold prices - over the last weeks, pointing to stronger perception of gold as an alternative currency."

"As the sovereign risks persist, gold prices may well mark new highs for the year." Gold's current 2010 peak is $1,168.70 an ounce.

U.S. gold futures for June delivery on the COMEX division of the New York Mercantile Exchange rose $6.90 to $1,160.90 an ounce.

Concern over sovereign risk in the euro zone, chiefly debt-laden Greece, has helped gold rise nearly 6 percent this year, despite a 7 percent fall in the euro versus the dollar, which would normally weigh on gold.

Monday, April 26, 2010

NEEL KASHKARI IS ALIVE! update I

He is BACK. On CNBC this morning as a guest host. After spending a year in the deep wilderness of the California Sierras, hiding out after spending years inside the belly of the beast, saving the system that he had helped to create. Kashkari was an investment banker at Goldman Sachs before Hank Paulson brought him to Treasury to assist him in taking down the Goldman competition. It was a daunting job, but Kashkari was sufficiently young and naive enough to be qualified. One night in the fall of 2008 as the financial world was unravelling around this yuppie pond scum dipchit, Uncle Hank brought Neel a job that Hank was just too busy to handle himself. Hank was busy taking apart some of GSs main competiion at the moment and selling off their raw flesh to some street dogs overseas. He picked Neel for the underling job of putting together the 800 billion dollar TARP bill. After all Neel had attended college and had worked at Goldman as a janitor for 8 months. Now remember the TARP was a lot of money but it paled to the 12 Trillion that was being put through the back door of the banks. They needed the public to be fixated on a number under a trillion while they used the other hand to pump in trillions while congress put the sideshow on.

As many of you know the officials were telling us publicly that all was going well and the financial system was stable, just as they are doing now. But now I listen to Kashkari on CNBC sans diarrhea and annorhexia saying that prior to the meltdown he was contemplating pulling money out of his money market to protect it so he could make house payments as the system was reaching a catastrophic collapse. Oh well....so much for public honesty. I guess now its ok to be straight with us. The problem this exercise in CONfidence has now...is just how far do you believe the system has been fixed. Sure.....Kashkari took his wife out of the Truckee woods before she left his lame ass. Now she can shop at Bloomingdales on his fat PIMPco salary and enjoy the fruits of his labors. But do you think he can really look in that mirror and say he saved the American Peoople. Or do you think he sees a schmuck that helpeded to pull off the biggest heist in economic history?

http://www.huffingtonpost.com/2009/12/07/iwashington-posti-profile_n_382437.html

update I Frank's tune gets post of the day. ANDS is exactly like this woman....and it can bring you up OR down...

http://www.youtube.com/watch?v=y7sEchp-n64

Sunday, April 25, 2010

HIGH STAKES GAME OF CHICKEN

Lets get this game straight. This is a game of who blinks first. In other words...which developed country is going to lose their first first finger sticking it into the beast's mouth. The Central Banker's cabal needs a sucker and is prodding the Eurozone to save its currency by committing to the stability of the European union and stepping up and propping up the bad boy gyro eating greek spendthrifts. What they should be doing is telling those oozo swilling hooligans to bend over and take it like greeks. After all as soon as this bailout takes place the savior is going to be in the quicksand too.

Or better yet lets assume that they(euro slaves) somehow put together a package that somehow saves Greece for a year. For little ol Greece to cause THIS much problem to save and I am not sure that it will even occur but say it does........THEN HOW IN HELL are they going to save the next PIIG country...and the next....and the next. Not to mention the Baltics. Yeh baby .....sure saving Greece for a few months might happen but at what cost?? Do you believe that Germany is going to sink their econmy to save Greece's socialized mess? AT what cost to Germany??? I don't see it. Kiss the Euro goodbye if they do.

April 26 (Bloomberg) -- Greece moved toward securing an emergency aid package before debt payments come due in mid-May as Finance Minister George Papaconstantinou warned investors they will “lose their shirts” if they bet the cash-strapped nation will default.

Speaking to reporters in Washington as he negotiated a three-year loan plan with the International Monetary Fund and European governments, Papaconstantinou said money will be available “rather soon” and his country wouldn’t restructure its debt. IMF Managing Director Dominique Strauss-Kahn said talks will end “in time to meet Greece’s needs.”

With 8.5 billion euros ($11.3 billion) of Greece’s bonds maturing May 19, any delay in assistance may trigger another sell-off in its assets and hurt global markets. Debt totaling 115 percent of gross domestic product in 2009 and a budget gap of almost 14 percent have some investors concerned Greece can’t fund itself, forcing it to seek a lifeline of as much as 45 billion euros for this year alone.

Greece’s fiscal crisis dominated the weekend meetings in Washington of finance ministers and central bankers from around the world. Those from the Group of 20 pledged “credible” strategies to withdraw economic stimulus as the global recovery beats expectations. They failed to narrow a split over whether to tax banks to pay for rescues and chose not to intensify pressure on China to let its yuan gain.

Greek Eclipse

“Greece has eclipsed everything,” said Sophia Drossos, co-head of global foreign-exchange strategy at Morgan Stanley in New York. “It’s a fluid and fast-moving situation that has captured the attention of markets not least because it has the potential to be a systemic threat.”

Saturday, April 24, 2010

SATURDAY MORNING FEAR WARNING

Put your bowl of Cheerios down and read this NOW. Sorry ...kidding. Just another reminder of what is coming down the pike from our good friend Marc Faber. And I wouldn't reprint this if I didn't believe it to be correct. In fact, this has always been the history of this game. Be aware that consolidation phases of gold are accumulation of the metal by the big money. All manipulated to not only keep the fiat game stable but for the big boyz to accumulate on the cheap. It is to create doubt for the schmuck retail holder to give up on the investment and puke up their shares.........it works. It applies to the mining sector also. If you can trade this range then its quite profitable but holding is very non rewarding (during the accumualation phase). The problem for retail is unlike the big boyz....they don't accumulate....the lever down their positions. Eventually a variety of factors will enter into the phase to limit it and presto the move up will begin. The next bull phase will be breath-taking and most investors won't chase it. I have three bull waves in this run. We have completed one. The next two will end around 10,000 or higher as faber says. Is there a way to give you a 100% guarantee. NO. But if you think that zero percent rates and freshly printed fiat makes sense .....be my guest. I will continue to also play the miners ...they are more volatile and subject to the whims of the overall market to some degree. But thats the game. Buy the physical and forget it. Go enjoy life. I like to gamble in the market. Its just a game. .....here's the excerpt...

Hong Kong (Kitco News) -- The rising price of gold is far from over since paper money will continue to lose value, according to Marc Faber, editor and publisher of The Gloom, Boom & Doom Report.

“If you have $100 today, you buy that much less in terms of a basket of goods and services then you did ten years ago – paper money has already lost a lot of value and in my view it will continue to lose value. The price of gold will adjust on the upside according to the loss of the purchasing power of money,” Faber said in an exclusive interview with Kitco News.

Still bullish on gold, Faber views precious metals as currencies, not commodities. He said that precious metals are currently his currencies of choice. Currently, stronger currencies such as the Canadian and Australian Dollar are still vulnerable to a slowdown in the Chinese economy, he said on the sidelines of the World MoneyShow in Hong Kong.

Faber said that he continues to buy the yellow metal, “If someone is rich they should buy a ton every month. “

He also said that everyone should buy gold because of the low US interest rates, “At zero percent interest, I don’t see why someone would not have part of their money in gold and silver.”

Faber said that "as far as the eye can see, interest rates under Bernanke will stay at zero and below." He noted that the current Vice Chairman of the Fed , "Janet Yellen, another totally, ignorant economist, removed from any reality, said herself six months ago, ‘if I could implement interest rates below zero, I would do it.’ So now you know what the policy in the US will be,” Faber said.
He also said that if gold prices substantially rise one day, there could be expropriation. “The Americans could force the Europeans to do the same – once they have all the gold in the world they would re-value it at $10,000 an ounce," Faber


http://www.kitco.com/reports/KitcoNews20100412J.html

Friday, April 23, 2010

LIKE A BEATLE ON ITS BACK update IV

The current news cycle mimicks nature. Every morning recently it reminds me of when I was a child fascinated by watching a beatle on its back furiously struggling to right itself but to no avail. Funny how things repeat. This morning the talking heads are trotting out the "experts" one after another to explain the "Greek Debt" situation. Of course this is only the test case to resolve, and they can't even put a cork in this leak. Will they resolve it? Yes. Of course. At least that will be the gruel for the masses.

The actual solution is a little more complex than that. It always is.

In this case whatever "solution" has to be applied in a very rapid succession to at least 5 other critically bleeding patients in the Eurozone. If only Greece were really the problem. But as a test case, it must struggle on its back until the "solution" is determined.

The medicine for this will be chosen very carefully. It is very similar to an oncologist choosing the correct chemotherapy for a critically ill cancer patient. The patient just could (and frequently does) die from the treatment way before the cancer would have killed them. Not to mention in this case whoever winds up giving this patient its life giving treatment may die. ie the rest of the eurozone.

You know how I feel about investments here. Its a precarious high wire act over a pool of hungry sharks. So if I sound like a gold bug now days...so be it. I guess Jesse and others have seen the light too. Its obvious. gl gang happy trading.

Truth is the most valuable thing we have. Let us economize it.
Mark Twain

update I.... its unraveling before your eyes...could be a nice leg up here. The market believes that Greece will be forced to restructure its debt," says Simon Derrick at Bank of New York Mellon in London, and "The logic of such a situation for [Greek bond] investors is also simple enough:

"There is no last mover advantage in such a circumstance.

"We also note outflows just starting to build from Portuguese debt in recent days," Derrick is quoted by the FT's Alpha blog, "although they are still relatively modest."

Precious-metals analyst Walter de Wet at Standard Bank also notes fears of Euro-debt contagion today, writing "We doubt [the Greek rescue] would be enough to lift concerns over sovereign debt levels in certain European countries."

Even though the physical market is currently "quiet and directionless", de Wet reports, "Underlying uncertainty should continue to support gold."

update II 0950... PMs breaking out.....oooooboy. may be right.

update III 1103.....Kitco. Comex gold futures have pushed higher in morning trading Friday, hitting a fresh high for the week and are poised to produce a technically bullish weekly high close Friday. June gold last traded up $12.10 an ounce at $1,155.00. The U.S. dollar index has dropped below unchanged price levels and is trading near the session low. Meantime, crude oil futures prices have moved above unchanged and are trading near the session high. That is prompting buying interest in gold futures. Once again, traders are viewing any dips in gold prices as a bargain-hunting buying opportunity.

update IV April 23 (Bloomberg) -- Gold rose the most in two weeks after the dollar halted a six-session rally against the euro, boosting the appeal of the precious metal as an alternative investment.

The euro rebounded from the lowest level in almost a year after Greece asked for a bailout from the European Union and the International Monetary Fund, easing concern that mounting debt will erode the value of the 16-nation currency. Gold rose 24 percent in 2009 as the dollar fell 2.5 percent against the euro.

“Gold is inextricably connected to the currency story,” said Kevin Davitt, a senior market strategist at LaSalle Futures Group in Chicago. “Gold is firming because the dollar is off its highs, and the euro has rebounded from its lows.”

Gold futures for delivery in June rose $10.80, or 0.9 percent, to $1,153.70 an ounce on the Comex in New York, the biggest gain for a most-active contract since April 7. The metal climbed 1.5 percent this week.

Greece asked the EU and IMF to activate a loan of 45 billion euros ($60 billion). Gold priced in euros rose to a record today on lingering debt concerns.

“The ink is just drying on the aid package for Greece, and the euro story hasn’t run its course,” Davitt said. “You can make an argument either way for gold” as a haven against the euro or an alternative investment to the dollar, he said.

Thursday, April 22, 2010

ITS BECOMING CRYSTAL CLEAR NOW update II

Oil tanking this morning along with the markets and gold. Its now clear the market is going down........today.....er...this morning maybe. Anyway I am certain of it. As the market marches down triple digits over "concerns in Greece" I have to look at a more likely explanation...and that is maybe they are less concerned for the moment about the impact of the Iceland issue and can let the steam now out of the recent levitation to maintain sentiment. Earnings aren't that bad today other than the issue of top line revenue issues and we all now how to resolve that.......increase productivity.....ya know.....like hey low life worker....less hours same productivity. Oh....and by the way we just shipped your job to India...right Red? Isn't that the way your business does it?

Oh and one more thing worker bee.....we can't afford your health care. It sucks being you, but take your beater off this property and pump in some of our gas at 85 bucks a barrel. After all...a lot of our boys have shed blood to establish our beach head on the shores of Tripoli to hold that price. And while we are at it don't worry we are prosecuting the graft...we may arrest Fabricio and crush the crooks of lower Manhattan.

I maintain my bullish stance on PMs and hope that you share my fondness for the priviledge of playing in the casino. If you think I am being sarcastic, you are partly correct but not entirely. This game would be closed if they had not put over 12.5 Trillion into this game since 2008 so you had better think twice if you are so "cock sure" of your solutions. I am not sure .....but I do know the game. gl

update I........absolutely true

http://www.youtube.com/watch?v=u5jrZ_y0Dws

update II AXP blows out.....Of course. I hope all of you enjoyed the game today. We will switch dealers before we open the game tomorrow. All of you will be extended a complimentary room tonight and dinner. I wish all of you a good night.

I make it a rule never to smoke while I'm sleeping.
Mark Twain

Wednesday, April 21, 2010

GORDON "GOLDFINGER" BROWN update II

Talk about an incredible stroke of public genius....this one is certainly one that ranks up there with some of the all time great screw-ups. I'll get to it in a minute. Before I go there I just want to speak on a related point that is essentially a reminder for those of you that follow this blog or invest in PMs. We are going through a very typical consolidation in gold and the miners. This is for a purpose. The real money is accumulating these stocks and the metal....an age old process that robs the average retail schmuck of their shares. Push them out of their investment by stagnating the price and making them unsure of the weak hand investment. I hope they give us another leg down but I have no way of being certain therefore I have a comfortable core. Time is on my side and I have great patience and may get my "buy chance". I love this article off of Goldseek regardin a historical blunder by now Prime minister Gordon Brown of Great Britain.

Brown, who took over from Tony Blair in 2007, acquired the ironic nicknames about 11 years ago when, against the advice of leading bankers, he sold off about 60% of Britain's centuries-old gold reserves. The timing of the sales, from 1999-2002, was “impeccable.” In his role as Chancellor of the Exchequer he sold 400 tons at rock-bottom prices. He got an average price of $275 an ounce, raising $3.496 billion. (British gold traders have dubbed the 20-year-low the “Brown Bottom.”) Since the unfortunate sale, gold prices have more than quadrupled to $1,159 an ounce.



There is a lesson to be learned here both for nations and for individual investors--hold on to your physical gold and don't worry too much about governments selling or "dumping" gold when its price gets very high - history suggests that governments are not the best traders and not necessarily sell at the top.



With only 310.3 tons of gold left in its Central Bank holdings, Great Britain, once an empire that ruled half the world, ranks number 16 on the list of gold-holding nations, just below Venezuela and just above Lebanon.



There is further irony in the fact that it was Britain that had led the way in establishing a gold standard when Sir Isaac Newton, as warden of the Royal Mint, linked the value of raw gold to the value of money back in 1717. The 1844 Bank Charter Act formalized the gold standard, the Bank of England’s promise that every note could be redeemed for its value in gold. The gold standard lasted until Britain was forced to abandon it during World War I. Churchill returned to the standard in 1925 but it was again abandoned in 1931.



Newspaper accounts in the British press estimate that Brown’s gold sale cost the British taxpayer about 6 billion pounds.



The gold sale has become a campaign issue and already posters have appeared of a smiling Brown with the accompanying text: “I lost 6 billion pounds selling off Britain’s gold. Vote for Me.”



According to British newspaper reports, the proceeds from the gold sale were invested in dollars (40%), in euros (40%) and in the yen (20%). It is safe to say that the revenues generated from the fiat currencies don’t come close to the spectacular four-fold increase in the value of gold since the sale.



In May of 1999, when Brown announced his plans to sell the gold, the price had stagnated for much of the decade in a secular bear market. British gold simply sat in the vaults gleaming prettily but earning no interest. Some had perceived it as a capital wasteland, an anachronistic relic. Apparently, Brown wanted assets that would generate interest payments. He ignored gold’s habit of retaining its intrinsic value over the long term.



“Golden Brown” was wrong to dump gold in favor of paper currencies. Gold’s breakout against the world’s primary paper currencies underscores gold’s growing allure as a store of value against further currency debasement caused by profligate government spending. It appears that gold is reassuming its role as an alternative currency unencumbered by the political liabilities of fiat money.

gl gang

update I ..... Dead as a doornail today. Precious metals are setting up in a secondary bullish channel that appears to be confirmed today .....But volume remains non confirmatory and the Ponzi overall market is in horrible need of a beatdown so the "all in" here remains a fool's game. Shorting here is also borderline insane. Continued accumulation of physical gold and silver is reasonable. Do not forget to include alpo in case Katla decides to join the party. I am pessimistic on all fronts but I think the ponzi has no choice but to continue to climb the proverbial "wall of worry". Warning...if you think I am kidding about Katla ....think again....It has always erupted WITH its "little sister". Scary times but no reason to get your panties in a wad. I am partying like its 1999. After all there really isn't Jack that any of us can do except enjoy the game...(thats my report tonight and I am sticking to it). OBTW the PPT has a contingency in place in case Katla goes and that is bend over and kiss all their axxes good nite. These are NOT manipulateable.

update II Just in case you missed it

http://jessescrossroadscafe.blogspot.com/2010/04/william-k-blacks-testimony-to-congress.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+JessesCafeAmericain+%28Jesse%27s+Caf%C3%A9+Am%C3%A9ricain%29

Tuesday, April 20, 2010

HOUSTON WE HAVE PROBLEM...AGAIN update I

Some nice comments last night (see previous post) that deserve some expansion. Currently the market is still chugging along quite nicely with all systems go. At least that is what appears to be on the surface the case. But the ponzimeisters are having a major headache right now with our little Icelandic volcanoe indigestion problem.

Media reports initially were full of impending doom for the economy, air travel, health. But it looks as that has shiften now to a "more optimistic tone" even though the monster belched a few more million tons of pollutants into the air last night that would exacerbate the air travel problems for at least a few more days. But of course headlines today were .......more optimistic.

Maybe that is the case and the possibility of nature cleaning the ponzi house out is going to have to rely on another solution. However I wouldn't be too quick to dismiss this bad boy.

So that takes me to the gist of some of the comments. It does look like we could run into a similar period when we were facing the dreaded "Swine flu". Nature makes ponzis nervous. Its not as predictable. They kept the market ramped right through any bad H1N1 news that came out. So be aware that if this volcanoe continues to exert a blanket of garbage over Europe at the same level it is now then they will continue to ramp. Simplistic.....maybe....but the public's CONfidence is absolutely the entire game here, so beaware. gl gang ..... "Behold...this is not just finest engineering feat...it is art" -inventor of the edsel

http://news.goldseek.com/GoldSeek/1271709085.php

funny temo...doesn't he know that this is not PC...

http://temo1051.blogspot.com/2010/04/youtube-breaking-danny-confirms-ppt.html

Monday, April 19, 2010

A NEW DAY ON WALL STREET update II

Sorry. Not gonna happen. At least not today. The weather is still partly cloudy and no chance of rain unless you are a British or German bank invested in mortgage products purchased from the boyz.

Our job is to make money today so focus on the job at hand. Ignore the noise about Goldman. This is all planned. The question is what is their plan and only THEY know that so.....forgettaboutit. My advice here is simple. Hopefully you have a core of miners. Watch closely for any volume buy day durning the next couple of weeks. Exercise patience. Hope that they are using this to rip the market down so you can get a nice discount on the miners.

Is this Joe's hoped for 10% overall market correction with a 30% discount on our little bad boy miners? Maybe. So be very patient here. If you have a core then there is no need to be a hero. Play what the market gives you. There is a reason for this sequence of announcements .....let's see what it is.

On the link below pay close attention especially the last fan chart. THAT could get very interesting. gl gang

http://news.goldseek.com/CliveMaund/1271618448.php

Pulled this off of Jesse's and had to smile...I like the style.

The spin was running hot and heavy this morning.

The scandal was a one off, a rogue trader. The charges against Goldman are weak, nothing illegal, perhaps just immoral. But morality is not an issue with qualified investors, who should have known better. This has never happened before and is unlikely to happen again. No one forces anyone to be victimized by a fraud. They did it to themselves.

The outstanding talking head on Bloomberg TV was guest salesman Tom Brown of Second Curve Capital, who never met a Wall Street pustule he didn't wish to feed upon. And he was supported eagerly by the bobbing heads of Adam Johnson and some less memorable sycophant. And of course the ineffably endearing news anchor, Betty Liu, who is an understudy for Alicia Silverstone in the Wall Street version of Clueless.

But CNBC's Steve Liesman put out a description of the scandal that was so outrageous that it made Mark Haines cough up a donut. Mark still has a conscience apparently but Steve left his at a pawn shop in Moscow. His economic arguments, along with Cramer and Kudlow, drove me away from CNBC long ago. But there is little refuge at Bloomberg anymore except in the off continent off hours, and Fox, well, it is Fox.

I expected a slime trail to appear early on, and I was not disappointed. And its a shame.

Charley Rose has a special on Goldman tonight and it should be worth watching. Charley is a journalist, and tends to show some integrity, which is an increasingly rare commodity in the American mainstream media

update II Swan report
http://news.goldseek.com/GoldSeek/1271684580.php

"Do we need to bring a sleeping bag, or will the volcano keep us warm at night?" Documentary producer at Mt Etna in 2000.

Saturday, April 17, 2010

GOVERNMENT SHUTS GOLDMAN SACHS DOWN

Sources report that the U.S. Justice department and the SEC in a coordinated effort locked the doors of the Goldman Sachs office in Manhattan and New Jersey after the close of the market Friday. It was reported that at least a dozen gray prison buses were seen being loaded with unidentified employees and officers of the venerable institution. Most kept their heads covered to prevent identification. Several bystanders were arrested for throwing eggs and painting obscene slogans on the buses. The mob was dispersed by mounted NYC police at the Broadstreet location.

A press conference is scheduled at 900 am April 17 by the US Attorney Generals office to update the dynamic situation. Typically there would have been an immediate response, but there were ongoing arrests at a number of locations within the New York Federal Reserve offices and at several other major Bank locations. The Gambino crime family was being asked to leave the prisons in the New York to make room for the oveflow of arrests.

OK thats enough satire...I give. I can't help it. This story is just toooo funny. Do they really think this is going to satisfy Nature. Let's see. A 31 yo junior exec at GS named Fabrice did it. You gotta be kiddin me. Thats equivalent of saying that 5 enlisted men and women committed all the atrocities at Abu Ghraib. We're supposed to swallow that?? hehehehe... Anyway the point of this is I really don't care what they trot out because it is all for show. This is a systemic cancer that cannot be removed, since the system is completely corrupted. What is the solution? We as individuals are the solution. We participate in the ponzi because of our own avarice and human failings and lack of moral courage. Including yours truly. WE are cowards. WE don't demand integrity or justice.

If you are going to be a trader in this market you have to know that this entire show today was just that. A show. A dog and pony show for the masses. We may see some brief fall out next week in the market but don't even count on more pullback. This is an effort to restore CONfidence and they would never prevent this market recovery without calculating every market effect of a move like today beforehand. So the game is still on. Look for the "buy" next week. gl gang btw we needed some steam out of this market...we may get it...at least we know why they ran it up...had to beat that friday news deadline....

http://www.huffingtonpost.com/2010/04/16/goldman-sachs-fraud-expla_n_540938.html

Friday, April 16, 2010

THE MOTHER OF INVENTION?? update I

Part II of Drokes interview with the long wave master has some nice parts....

Barker: I picked up that term from, Redistributive World Empire, from Immanuel Wallerstein. There’s an interesting group called World Systems Analysis that studies the advance of civilizations, cultures, etc. Wallerstein has said that in the past he has said that any world economy has ultimately evolved into a redistributive world empire. Rome is the classic example of this type of empire, where the bread and circuses were required to pacify the masses and the Roman Senate was completely corrupt and of course the Caesars became corrupt and ultimately Rome collapsed. What’s interesting is that Wallerstein’s work has always seen that progression from a world economy to what he calls a redistributive world empire. This time around, however, he’s proposing that each long wave is a kind of birth pang of global socialism. Incidentally, Wallerstein has very left-leaning socialist inclinations. He believes that instead of going toward a redistributive world empire we’re going to go toward global socialism. Of course if you look at what has happened in the last year and the way we responded to the global financial crisis, you have to say, “Oh my goodness, Wallerstein may be right after all.” But if you look closer, what really has transpired is what looks more like a Redistributive World Empire where the middle class is taxed really for the interest of an elite class of political and business managers. I guess another term of Redistributive World Empire would be crony state capitalism. And state capitalism isn’t the same as international free market capitalism.



So basically in the book I present three scenarios. Scenario one is what Wallerstein says, namely that each long wave leads to a bigger crisis of capitalism with the birth of global socialism. I don’t think that’s where we’re headed. Then I examine the observation that in the past a crisis in the world economy always produced a redistributive world empire. You’d have to say that’s the most likely outcome where we’re headed based on the evidence. My proposal is the Great Republic, and I truly believe there is a great chance to go in the direction of true international free market capitalism as a result of the crisis that we’re sailing into. I think as you look around and see the austerity in Ireland and see the Germans preaching austerity to the Greeks, it’s important to realize that austerity is not a redistributive world empire. I actually believe that a sovereign debt collapse would be the ultimate mother of invention leading to the necessity of a Great Republic. There’s definitely the potential for such a collapse to produce change towards the Great Republic.

Read the rest of the interview its very worthwhile...gl gang

update I important summary on GS news....hot off Taibbi's comment section...

"Yeah, unfortunately no one is going to jail since this is a civil matter. It’s basically the legal equivalent of letting your best friend punch you in the stomach because you nailed his sister."

http://news.goldseek.com/ClifDroke/1271340000.php

Thursday, April 15, 2010

MO MONEY update I

Phenomenally accurate forecasts



Better take a mental snapshot of yesterday’s glorious economic news, since it’s hard to imagine things will get much better. Retail sales for March were up a reported 1.6%, the service sector supposedly is rebounding nicely, and big-ticket items are starting to sell like it was 2006 all over again. Economists were ecstatic, of course, since the torrent of good news allowed them to upwardly revise their forecasts for 2010 and beyond. Nor were the sunny tidings confined to Main Street. Over on Wall Street, J.P. Morgan weighed in with a 55% gain in profits for the first quarter, amounting to a tidy $3.3 billion. Much of it came from their trading desk -- and a good thing, too, since we’d have been gravely concerned if their best and brightest had somehow failed to make money betting the “pass” line on a stock market that has been rising on maybe eight days out of ten in recent months.



And rise once again they did yesterday, surpassing yet another Hidden Pivot target with effortless aplomb. We’d been using 11077 as a minimum projection for the Dow Industrials for the last several hundred points; yesterday the blue chip average hit 11125, exceeding our mark by 48 points. A companionable target in the E-Mini S&P gave way almost as easily, implying that buyers are not yet finished.



Cool Ben



With all the hoopla and hubris, leave it to Helicopter Ben to totally keep his cool. Here we have an economy that is going absolutely bonkers, and the guy insists there is little to fear at the moment from inflation. This obviously was music to Wall Street’s ears, since it means that no matter how strong the recovery gets, the Fed sees no great urgency about raising the federal funds rate. We love the way Bernanke’s amen corner at the Wall Street Journal put it: “His inflation assessment gives the Fed room to be patient about raising rates.” Is “patient” the perfect non-word here, or what? Easy Al Greenspan himself could not have come up with a more innocuous way to describe de facto easing in a financial system that is already glutted with government largesse.



So now we get to imagine GDP growth barreling along at 5%, but with 4% mortgages and even lower rates for the 10-Year Note. If these things should come to pass, the Dow Industrials will probably trading above 20,000. Isn’t it time to spend some of the anticipated gains at Best Buy? That would be pretty patriotic, actually. the END That was from Rick's Picks..

Part II
On the run right now but ya gottal look at this ....it really has a nice "fit" to it. At least from my ponzi perspective

http://www.kitco.com/ind/Conner/apr132010.html

update I (Reuters) - Gold climbed toward $1,160 an ounce on Thursday, defying a stronger dollar against the euro, as lingering worries over Greece's debt crisis boosted buying of the metal as a hedge against uncertainties.

Bullion's gains in the face of a stronger greenback indicate that the negative correlation between the metal and the dollar has lessened as problems in the euro zone prompted risk-averse investors pile into gold as a safe haven.

"We have a disconnect between gold and the dollar, and that will continue as long as Greece and the euro zone are still in the news," said Frank McGhee, head precious metals trader of Integrated Brokerage Services in Chicago.

Euro zone ministers agreed on Sunday to make available 30 billion euros in loans with a further 15 billion from the International Monetary Fund. But uncertainty remained over how the financial assistance would be implemented.

"Until there is a firm resolution, you will continue to see gold to benefit despite euro's losses."

Spot gold was at $1,158.90 an ounce at 3:07 p.m. EDT (1907 GMT), against $1,153.90 late in New York on Wednesday.

U.S. gold futures for June delivery settled up 70 cents at $1,160.30 an ounce on the COMEX division of the

Tuesday, April 13, 2010

THE GAME updateI

Philipp Brothers, now Phibro was at one time the world's biggest commodities trader. The company was founded in 1914 as Philipp Brothers. It was later bought by Englehard Minerals & Chemical Company and subsequently spunoff in 1981 as Phibro Corporation.[1] That same year, the company acquired Salomon Brothers, creating Phibro-Salomon[2]. In 1986, the combined company removed the Phibro name from the parent company. Eventually, the company was acquired by Travelers Group in 1997, which subsequently merged with Citicorp in 1998. It is now the commodities trading unit of Citigroup.

Phibro came to the notice of the public when its head Andrew J. Hall reportedly was seeking a $100 million dollar bonus from Citigroup which had been bailed out by US taxpayers in 2009. Reportedly Phibro was the main source of the $2 billion in pretax revenue Citigroup received in commodities trading.[3]

On October 9, 2009, Occidental Petroleum announced it would purchase Phibro from Citigroup for approximately $250 million. from Wikipedia...

The GAME.....1997- Warren Buffet. The following is an exerpt from ZH. I recommend the entire read but I particularly liked this...

•I got my chance to not get run over in 1997, when Warren Buffet gave an order to Phibro to buy silver.
•Short version. Here is what went down.
•Buffet gives Phibro the order- fact
•Phibro begins filling it as a broker using various OTC dealers as counterparties, and letting the I.B dealers sweat getting out of the risk. - fact
•Phibro buys options for their own account (no exercise game this time tho)- fact
•Phibro buys futures for their own account. – not confirmed.
•One by one the IB dealers start to catch on that this is no ordinary order Phibro is handling. They back away and liquidity gets harder to find.- fact
•Other bigger hedge funds in the small circle of professionals, and other smart firms start getting long.- fact
•Silver starts getting delivered from the Comex vaults. Some of it actually removed. Some of it just “covered with a sheet” for removal. But ounces begin to be removed from the warehouse. Phibro was rumored to be taking delivery and beginning to telegraph fear in the markets to start spoofing the VWAP. Rumor was they had a warehouse in Red Hook where they stored it. Never confirmed.
•Point here is, the saps for the last part of this play were the producers and refiners who were complacently net short and dependent on above ground silver to satisfy delivery requests.
•Producers had been over-hedging for years in this market, as silver was cheap and they had business cash flow issues. It was their habit to sell forward production not yet available to them. And if forced to, they would lease already above ground silver and make delivery, collateralizing it with silver yet to be mined. Their positions were habitually synthetically long the contango as they rolled their deliverable production further and further out the curve in an attempt to squeeze much needed cash (cost of carry)for their businesses. The net effect was that sometimes they had to borrow silver for prompt delivery while they rolled their production hedge back further. – my interpretation of what I learned. May not be accurate to the “T”, am not a physical guy.

•Example: in 1995 a miner has silver due above ground in 1997. He hedges it in Z-1997 contract. Z 1997 comes and if he doesn’t have that silver available for some other reason; he covers the short and rolls it back. How much he needs to do this is a function of his obligations, cash flows, and his greed for carry. If leases are cheap, he will seek to capture all the contango and lease it until he gets the silver available.
•If lease rates go up, it is not unlike a miner strike. Silver is needed for delivery now, and term risk becomes the issue. Contango collapses and market goes backwardated. He will be forced to sell the contango to get that prompt silver short back if he cannot make delivery. He has to defer delivery.
•These guys were dependent on the specs NOT taking delivery for years. Specs didn’t have balance sheets to take and store physical metal. Specs usually were the weak hands at futures expiry.
•But then…..Entities that stored silver in bank vaults (like the Republic vault) begin to remove silver from the available pool for leasing. This made the “easy money” portion of production financing no longer easy. Think: smart money getting the word that a squeeze was on and playing along with it.
•Phibro (and others) start selling the contango in the futures market to prepare to take delivery of even more contracts. Or at least put pressure on the producers who had front month shorts they would have to make a decision on delivering. Phibro KNEW that the producers had to sell the spreads to get their shorts back. But they couldn’t lift their shorts altogether as part of their financing deals with their bankers. Their own positions were now breaking down in every way except flat price. The market really didn’t move much. This let them stay in denial.
•Buffet announces he is long and intends to take delivery of silver. Contango collapses. Market spikes to 7.40.
•Rumor is gov’t intercedes and asks Buffet to not do this, it would break the industry. (Kind of like how the exchange begged the gov’t to help it shut down the Hunt Bros.) He says ok, and agrees to lend then their silver back to them. Essentially charging them 40% interest to delay delivery for a year.

http://www.zerohedge.com/article/exclusive-second-whistleblower-emerges-deep-insiders-walkthru-silver-market-manipulation

updateI SAN FRANCISCO (MarketWatch) -- Gold futures moved higher Wednesday, as investors showered it with attention and other metals posted multimonth price highs.


Watchdog Warns $85/Bbl Oil Puts Recovery At RiskThe International Energy Agency has joined a chorus of economists warning that persistently high crude prices threaten the global economic recovery, amid growing concerns that $3-a-gallon gasoline at the U.S. pumps this summer will hit consumer demand.
Gold for June delivery added $6.20, or 0.5%, to settle at $1,159.60 an ounce in the Comex division of the New York Mercantile Exchange.

Underscoring investors' ongoing interest in the precious metal, the volume of gold contracts rose again Tuesday to 528,856, posting a fresher record volume since mid-January and inching closer toward the all-time volume high of nearly 594,000 contracts set in January 2008.

Wednesday numbers were not immediately available.

"Gold is now an international currency, and it's a safety play in a lot of instances," said Frank Lesh, a broker and analyst with FuturesPath Trading in Chicago. "Despite the fact that equities are up and economies do look a little better, there's still a need for safety, and gold is it."

U.S. consumer prices rose 0.1% in March, a Labor Department report showed, and Commerce Department data showed retail sales rose 1.6% in March, their biggest gains in four months and above market expectations.

Still, gold's facing resistance to go above the $1,170 to $1,180 level, according to Leonard Kaplan, president of Prospector Asset Management in Evanston, Ill.

Gold was also the beneficiary of a weaker dollar as well as higher crude prices -- following a surprise drawdown in weekly U.S. inventories -- and a rising stock market, he said. See Futures Movers for more on the action in oil.

"Believe it or not, the gold market has been following stocks lately," Kaplan added. "It's about risk, and people want more risk" in an environment of lower interest rates.

But a highly followed report on gold sees its run nearing an end. Precious-metals consultancy GFMS Ltd. on Wednesday released its 2010 survey, saying that gold is near its decade-long bull run even though short-term prospects are still rosy.

11,000 ACHIEVED....NOW WHAT? update I

More of same to come in my opinion. They didn't take this ponzi to this level just to let it dump. Will we see a correction here? Maybe. Have we seen a meltup yet? NO. So don't over analyze this market. Its a printing machine, manipulated Ponzi. Just enjoy and appreciate the game. This is all done to restore investor CONfidence and to get mom and pop feeling good about their retirement money. We have to get the juices of entrepeurialism flowing. We had a collapse. An absolute fn catastrophe. Remember Ben promising to do "whatever it takes". This will require lotsa money. With that will come MORE malinvestment. And yes you fellow gloomers it will be bad. But guess what? We can make money and maybe get out of this with our skin still attached. Right now velocity of money is slowly starting to turn so lets pay attention for signs of what WILL ultimately stop the PONZI and that is when nasty dirty PONZI KILLING inflation breaks out. AND it will. First in the form of stagflation. AND it will get ugly. Next we could actually get a deflationary period before true inflation. Say from 2012-2014. But we will get inflation. NO and I mean NO way out of it. Have fun fellow taxpayers. To coin a famous phrase of Ben's. YO AZZ IZ MINE MTHFKR. GL gang.

http://news.goldseek.com/GoldSeek/1271138640.php

(Reuters) - Gold prices fell on Tuesday, losing nearly 1 percent, as investors took profits following a price rally driven by a rising euro amid optimism about a rescue package for debt-laden Greece.

The metal had climbed to a four-month high at just below $1,170 an ounce on Monday as relief over the 30 billion euro ($40.81 billion) bailout plan for Greece sparked a rally in the common unit against the dollar. But gold finished flat as weaker physical demand limited gains.

"There is profit taking as the market is getting ahead of itself from news of the Greece bailout last week," said George Gero, vice president of RBC Capital Markets Global Futures.

Gold had ended higher for a seventh consecutive session prior to Monday, Reuters data showed. The metal was also 3 percent higher last week.

Spot gold was at $1,152.80 an ounce at 2:56 p.m. EDT (1856 GMT), against $1,155.00 late in New York on Monday.

U.S. June gold futures settled down $8.80 at $1,153.40 an ounce on the COMEX division of the New York Mercantile Exchange.

Market sentiment took a toll after minutes from a mid-March Federal Reserve meeting showed the U.S. central bank discussed raising for a second time the discount rate, the interest rate charged on emergency loans to banks.

Saxo Bank Senior Manager Ole Hansen said that the gold market was being driven chiefly by currency moves, with uncertainty linked to a possible yuan revaluation by China also a background factor.

"There are a few worries creeping in about a correction, as we have had a good move, but it is healthy that we finally managed to break recent highs," Hansen said.

Monday's intraday high at $1,168.70 was the firmest since December 8.

Monday, April 12, 2010

BREAKING NEWS update I

I am putting this story up because I want you to understand how the system works. This story has been building for weeks now after a multi-year process by GATA to expose the manipulation of the precious metals market to maintain control of the world's fiat currency system. Obviously the dollar is the focal point of fiat and of course will be protected at all costs. Observe how this story goes NOWHERE over the next few weeks. That is true power. In time perhaps through breakdowns dictated by nature this ponzi breaks but my experience says NOWHERE (at least for now).

NEW YORK POST

There is no silver lining to the activities of JPMorgan Chase and HSBC in the precious-metals market here and in London, says a 40-year veteran of the metal pits.

The banks, which do the Federal Reserve's bidding in the metals markets, have long been the government's lead actors in keeping down the prices of gold and silver, according to a former Goldman Sachs trader working at the London Bullion Market Association.

Maguire was scheduled to testify last week before the Commodities Futures Trade Commission, which is looking into the activities of large banks in the metals market, but was knocked off the list at the last moment. So, he went public.


AP
Brokers and traders transact gold futures on the Comex floor of The New York Mercantile Exchange, Thursday, April 6, 2006. Gold prices topped $600 an ounce in Comex trading Thursday. (AP Photo/John Marshall Mantel)
Maguire -- in an exclusive interview with The Post -- explained JPMorgan's role in the metals pits in both London and here, and how they can generate a profit either way the market moves.

"JPMorgan acts as an agent for the Federal Reserve; they act to halt the rise of gold and silver against the US dollar. JPMorgan is insulated from potential losses [on their short positions] by the Fed and/or the US taxpayer," Maguire said.

In the gold pits, Maguire sees HSBC betting against the precious metal's price without having any skin in the game in the form of a naked short.

"HSBC conducts an ongoing manipulative concentrated naked short position in gold. Silver is much easier to manipulate due to its much smaller [market] size," Maguire added.

"No one at JPMorgan is familiar with Andrew Maguire," said Brian Marchiony, a company spokesman. HSBC declined to comment



http://www.nypost.com/p/news/business/metal_are_in_the_pits_2arTlGNbMK7mb1uJeVHb0O/0

thnx temo

http://www.kingworldnews.com/kingworldnews/King_World_News.html

update I

(Reuters) - Gold finished flat on Monday, retreating from a four-month high despite a euro rally against the dollar, as weaker physical demand for the precious metal limited gains.

Bullion's failure to rise further in spite of Wall Street's gains and a sharply lower dollar indicated that the negative correlation between the metal and the U.S. currency has lessened.

Miguel Perez-Santalla, vice president of sales at Heraeus Precious Metals Management, said gold prices, which have been supported by investment demand, looked "toppish."

"We could be due for a short term correction right now, as actual physical consumption is way off. Even though people are talking about the economy doing so much better, we are not seeing it here."

Spot gold was at $1,158.50 an ounce at 1:54 p.m. EDT (1754 GMT), against $1,159.00 late in New York on Friday.

The metal hit a four-month peak at $1,168.70 an ounce during the session, but eased as the euro retreated from highs amid fears its rise may have been overdone.

U.S. gold futures for June delivery on the COMEX division of the NYMEX settled at $1,162.20 an ounce, up 30 cents.

The euro had climbed to a one-month high against the dollar during the session, as euro zone finance ministers agreed on a 30 billion euro ($40.5 billion) rescue package for Greece.

Bullion was pressured by lingering uncertainties about sovereign credit, especially in smaller euro zone economies, and doubts that Greece's fiscal situation will improve.

"In the futures market at least there is some doubt over how far this rally can extend," said Standard Bank analyst Walter de Wet. "Looking at what is happening in the options market, people at least for now seem unwilling to buy upside."

Saturday, April 10, 2010

DAVID KNOX BARKER INTERVIEW update III

David Knox Barker is one of the leading authorities on the economic long wave, otherwise known as the Kondratieff Wave (a.k.a. “K Wave”). Barker has had an impressive career both as a financial market writer and long wave analyst, as well as being an entrepreneur in the field of emerging nanotechnology. Back in the late 1980s and ‘90s, Barker was known for his insightful and accurate views on the U.S. economy and financial markets via his “K Wave Report” newsletter.



Barker first emerged on the financial market scene in June 1987 with the publication of his first book, Jubilee on Wall Street: An Optimistic Look at the Coming Financial Crash. The book made quite a stir among investors as it was released a few months before the spectacular crash on Wall Street. It accurately predicted a number of financial market and economic trends for the U.S. and global economies and was followed up by a second edition, entitled, “The K Wave” [Irwin Publishing, 1995]. This particular volume has long been a staple of my financial library and I’ve made frequent reference to it over the years to broaden my understanding of the economic long wave.



Barker took a long hiatus from the financial markets after 1999 to concentrate his attention on his company, ALP Life Sciences, a life sciences and research company that is currently working on a revolutionary application of nanobiotechnology known as the Nanoveson™ project. Last year, Barker took time out to revise the book and publish a third edition entitled, Jubilee on Wall Street: An Optimistic Look at the Global Financial Crash.



They say the “third time is the charm” and this saying definitely applies to the latest edition of Barker’s book. The third edition of Jubilee on Wall Street is, in my opinion, an instant classic that should be read by anyone interested in the outcome of the global financial crisis. As an aside, the latest edition contains a forward by the famous evangelist Billy Graham (Barker is married to Mr. Graham’s eldest granddaughter).



Barker recently discussed the book with me and shared his thoughts on what he sees ahead for the United States and the emerging markets. What follows is the transcript of that interview

http://news.goldseek.com/ClifDroke/1270826731.php

update I from old skf pal
http://www.iousathemovie.com/

Germany Said to Accept EU Loan Compromise for Greece (Update1)
Share Business ExchangeTwitterFacebook| Email | Print | A A A By John Fraher and Brian Parkin

April 11 (Bloomberg) -- Germany is prepared to give Greece loans at below-market interest rates, dropping its opposition to subsidies as European finance ministers meet to discuss the terms of a lifeline for the debt-stricken nation, a European government official said.

The loans would be priced above the rate charged by the International Monetary Fund, which would also participate in a European Union-led rescue, said the person, who spoke on condition of anonymity. Such an arrangement would satisfy German demands that Greece shouldn’t be given subsidized loans, the person said. Greece may receive loans for between 20 billion euros ($27 billion) and 25 billion euros at a rate of about 5 percent, Die Welt reported today, without citing anyone

http://www.bloomberg.com/apps/news?pid=20601087&sid=a4reHxxCyU2E&pos=1

Friday, April 9, 2010

LIQUIDITY GALORE update III

The liquidity game looks strong this morning with most overseas markets ripping. Print those greenbacks......its all good. Joes calls should be strong today. My miners should all be smiling. Oh well....guess the game hasn't changed.........yet. For those of you like me out there that say watch out they will change just when you think they won't.....then think again here. The employment numbers remain terrible...and that is the essence of this entire facade.....to restart an economy with CONfidence. That CONfidence is the markets performance as their starting point. They will push this to the maximum. Will there be a few fakeouts like "fiscal discipline" lies......of course. I fully expect some nominal efforts that will pause us but that is all nominal. At least for the remainder of this year until prices of essential goods begin to crush us. So don't forget the punch bowl is still there.

Gold hits 3-month high on dollar dip, haven flows
Jan Harvey
LONDON
Fri Apr 9, 2010 7:33am EDTLONDON (Reuters) - Gold rose to three-month highs in Europe on Friday as concern over the fiscal outlook for peripheral euro zone economies boosted safe haven flows into the precious metal, with a rebound in the euro also lifting prices.

Holdings of the world's largest gold-backed exchange-traded fund, New York's SPDR Gold Trust, rose nearly 10 tonnes to a record 1,140.433 tonnes on Thursday, its biggest one-day rise since September.

Spot gold peaked at $1,157.76 and was bid at $1,156.85 an ounce at 1056 GMT, against $1,150.15 late in New York on Thursday.

"The market is overall little bit disappointed with all the problems with Greece," said Afshin Nabavi, head of trading at MKS Finance in Geneva. "A lot of people are turning to commodities as a safe haven.

"We've got a lot of potential still to come in gold," he added. With the metal's break of resistance at $1,155 an ounce, he said, "the path to $1,200 will be open."

U.S. gold futures for June delivery on the COMEX division of the New York Mercantile Exchange rose $5.20 to $1,158.10 an ounce.

Spot gold prices peaked at $1,226.10 an ounce in December amid talk of fresh interest in the metal from central banks. It has since been buoyed by persistent concerns over the fiscal health of debt-laden Greece and other smaller euro zone economies such as Portugal, Italy and Ireland.

This has helped the metal shrug off overall strength in the dollar, which has risen more than 6 percent versus the euro so far this year. Strength in the U.S. currency usually weighs on gold, which is often bought as an alternative asset.

update I.... Think that someone doesn't trust the ponzi fiat.hehee

http://news.silverseek.com/SilverSeek/1270840329.php

update II....High priest immred is nice summary

hehehheh,

Central Banks to busy with printing fiat to surpress gold at the moment, plus higher prices means slower drain on the physical by the BRIC nations, usual Indian wedding season coming up, diversify out of neo-icelandic euros. Wouldn't worry if you were accumulating physical maybe even consider silver on a strong pullback, pm miners may be seeing a little strain.

Continued Strong and growing demand in cars and infrastructure projects in China will continue the desire for raw base metals. CNAM should doe well later, unfortunately short term traders could see more basing or capitulation early next week if there are any big sellers left. Noticed some of the bashers on the CNAM board are waiting for 6 or a close of the gap to massively accumulate or cover, with almost universal sentiment of longs accumulating more in the low 7s. With MMs in control, this will probably be very messy and brutal. Just don't play any leveraged positions on CNAM, for that matter don't play any leveraged positions or 2x-3x ETFs if you can't wait out the stop shopping.

As for the S&P technicals looking extended and ready for a pullback, so we will probably break 1200 on the S&P next week without raising a sweat.

Took a stroll over to Daneric's site, seems a lot less Prechter kool-aid, but guessing a specific single P2 target right now is still a fools errand. My pure foolish out of my butt guess is P2 will be a very long rolling distribution with multiple high volume spikes lasting 6-12 months through a period of stagflation of essentials like energy, metals, and food plus growing hidden unemployment in Western nations, mainly Ireland, Greece, Spain, US and England.

Just saw a beautiful mansion in a crappy neighborhood get another 20% listing haircut this week after being listed for about 4 years now.

updateIII....absolutely devastating

http://www.zerohedge.com/article/bank-international-settlements-sees-us-debtgdp-over-400-2040

Thursday, April 8, 2010

ITS ALL GREEK TO ME update I

We've gotta trot out the Greek mess to bring the market down a couple of notches. Not that Greece isn't a monstrous disaster but it is known and gives the ponzi no pause in the intermediate term. I will be watching closely for weakness in the miners to trade on but son't forget to watch CNAM ALU S here.

(Reuters) - Stock index futures fell on Thursday, following global stocks lower, as persistent fears over Greece's public finances unsettled investors worried about sovereign debt defaults in Europe.

Markets pounded Greek bonds and banking stocks, driving the country's borrowing costs to new highs and pushing it closer to tapping a last-resort safety net.

U.S. financial shares weakened in premarket trade, with Citigroup Inc (C.N) down 1 percent to $4.32 and Bank of America Corp (BAC.N) off 0.5 percent to $18.53. The Select Sector SPDR Financial ETF (XLF.P) fell 0.3 percent.

"Greece is the word that just seems never to go away," said Kim Caughey, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh. "What is the EU going to do, and structurally how are they going to address this? I think that's the big question because we have Spain, Portugal looming out there as well."

S&P 500 futures fell 3.8 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures dropped 42 points, and Nasdaq 100 futures lost 4 points.

U.S. equities pulled backed Wednesday after hitting levels not seen in a year and half. The Dow industrials fell back from the psychologically important 11,000 level, with some analysts saying investors are taking profit with no catalyst to drive the market higher.

Data on weekly initial claims for jobless benefits is due before the bell, an important indicator on the state of the economy as optimism grows about the strength of the labor market. Economists in a Reuters poll expect that new claims fell by 4,000 last week.

A nascent pickup in consumer spending has expanded beyond discounters to other retailers, according to early reports on March sales. Limited Brands Inc (LTD.N) reported same-store sales jumped 15 percent, sending the stock up 1.2 percent to $26 in premarket trade.

Daily update I

http://www.marketwatch.com/story/gold-retreats-as-commodities-pull-back-2010-04-08?siteid=yhoof

Wednesday, April 7, 2010

KEEP YOUR FOCUS HERE update II

Nearing Joes breakout number on gold at 1150 ....so be on your toes ...this is danger zone.....Also its obvious that the VAT is coming so pay attention to that news...ooooboy
(Reuters)
Gold steady as strong dollar offsets diversification
Jan Harvey
LONDON
Wed Apr 7, 2010 7:30am EDTLONDON (Reuters) - Gold steadied in Europe on Wednesday, retreating after hitting a record high in euro terms, as the rising dollar offset buying linked to fear-driven diversification into hard assets like bullion.

Dealers reported good physical gold buying from major markets like India in recent sessions, which also supported prices. Other precious metals also rose, with palladium hitting a two-year high and platinum its strongest price in 20 months.

Spot gold was bid at $1,134.95 an ounce at 1109 GMT, against $1,133.20 late in New York on Tuesday. U.S. gold futures for June delivery on the COMEX division of the New York Mercantile Exchange eased 10 cents to $1,135.90 an ounce.

"Yesterday good demand from India for physical (gold) continued," said Afshin Nabavi, head of trading at MKS Finance.

"We are currently flirting with important resistance in dollar terms. Should we be able to take out the $1,145-1,150 area, we should be ready for a big move toward the $1,200 level."

Traders report Indian jewelers are stocking up as the wedding season begins in the world's largest gold consumer.

Jitters over the outlook for the euro zone also resurfaced amid uncertainty over a proposed Greek aid deal, following a media report that Greece wanted to renegotiate a joint EU-IMF aid deal reached last month.

The euro's resulting slide toward a one-week low versus the dollar would typically depress gold prices, but it has also led some investors out of the single currency and into gold.

"Gold still has to conquer resistance around $1,146 to confirm a break from its current broad trading range," said James Moore, an analyst at TheBullionDesk.com.

"However, increasing concerns over fiscal deficit levels continue to draw diversification toward hard assets, particularly gold."

Nonetheless, the stronger dollar did take some of the wind out of gold's sails, pulling prices off a high of $1,138.20 hit in earlier trade.

PLATINUM, PALLADIUM CLIMB

Euro-priced gold also came off the record high of 851.92 euros an ounce established earlier, and was later bid at 849.96 euros against 846.04 euros late on Tuesday.

Gold prices are also being supported by expectations interest rates will remain low for an extended period, which will keep the opportunity cost of holding gold low.

Minutes from the U.S. Federal Reserve's last meeting released on Tuesday suggested the bank could keep interest rates ultra-low for even longer than investors expect if the economic outlook worsens or inflation drops.

Among other commodities, platinum group metals also benefited from expectations for an economic recovery, with dealers reporting good demand for palladium in particular from Japanese carmakers.

Platinum and palladium are primarily used in catalytic convters, but both have also seen significant investment interest this year, especially since the launch of new exchange-traded products backed by these metals in New York.

Platinum hit its highest since August 2008 at $1,723 an ounce and was later at $1,712.50 an ounce against $1,697.50. Palladium hit a two-year high at $511.50 and was later at $508 against $504.50.

update I
http://www.reuters.com/article/idUSTRE6361B120100407

updateII
Watch this for pure entertainment......Ratigan better watch it or he's gonna get an offer he can't refuse...go Dylan.

http://www.zerohedge.com/article/dylan-ratigan-discusses-great-financial-con-job-alan-grayson-and-bill-fleckenstein

Tuesday, April 6, 2010

ALL A GREAT BIG SCAM!!! update II

So what? That has been known for decades by many of us. Now Walayat slaps us too. I guess I shouldn't waste cyberspace stating the obvious, but I do want those of you that don't believe this can go on for much longer to understand this is NOTHING new for the game. Yes....it is more extreme than previous manipulations and like all the others it will end badly but it is what it is. Hope you all had a nice weekend and lets make money. I for one am hoping for a little red today and will buy back some of my favorite miners if I get a chance. GFI EGO ANV (already have enough AUY) SSRI SLW. HERE is a WAYALAT excerpt....

There is no point crying market manipulation because, YES the markets ARE manipulated! This is something that has been apparent to me from very early in my trading career, in fact the day after the 1987 crash (19 Oct 2007 - How a Newbie Beat the Great Crash!), so probably also for many, many decades before then. So what ? In fact it makes it easier to arrive at firm conclusions such as that March 2009 was the TIME to buy BECAUSE the markets ARE manipulated, it IS because the SMART money (the dark pools of capital) which is doing the manipulations, however they CANNOT hide their manipulation from the price charts which is why one can rely on experience and on going analysis to GUESS as to why markets will enter into a bull market, but the reasons only become obvious AFTER the market has risen by more than 50%, as I warned off in Mid March 2009 - (15 Mar 2009 - Stealth Bull Market Follows Stocks Bear Market Bottom at Dow 6,470).

Q. How can you be bullish on stocks and bearish on the Economy.

A. The markets move ahead of the economy, whilst I don't profess to know the EXACT reasons of why they will move AHEAD until that becomes apparent AFTER the market has already moved, however I do have some reasoning in that INFLATION, Zero Interest Rates (Forcing savers / financial institutions to take risks) Quantitative Easing (money printing), and HUGE Fiscal stimulus packages that are laying all of the ground work for the next bubble regardless of how bad things appear as any outcome that prevents another Great Depression will be seen as bullish! i.e. even a low growth high inflation stagflationary environment WILL be seen as a positive outcome against the present day data that points to a collapse of global demand on a scale not seen since the Great Depression. The governments HAVE learned the lessons from the Great Depression and WILL succeed in inflating the asset prices and ignite the next perhaps even bigger bubble, meanwhile the stealth bull market will continue which by the time everyone realizes what's going on stocks will already by up by perhaps more than 50% from the low.

I see much of the above recently being mentioned by many BlogosFear sites such as ZeroHedge after the markets have risen, though tainted with conclusions that it is unsustainable, however missing the whole point that the rally in asset prices is in actual fact the TRIGGER for the economic recovery as the above indicates.

So dear reader, Yes, not just the markets, but EVERYTHING that involves human activity is MANIPULATED, EVERYTHING, that is how we have grown to number 7 billion manipulators across the globe, it is imprinted in our genes to manipulate our environment either as individuals or groups, countries, continents and even the sum of the whole through mechanisms that humans have put into place. Where humans are concerned there is no natural order, natures law, we have long since left environmental pressures that impact on other Earth creatures long since behind and live in a bubble of human created reality.

Realise this and you will stop worrying about the obvious such as why Gold prices are not already at $5,000, because there is a greater weight of human manipulation depressing Gold prices than that countered by gold bugs wanting to manipulate gold prices higher through their own propaganda and buying pressure.

update I. this may not be "it" but this is what "it" will begin as...an innocuous Reuters evening summary like this.

http://www.reuters.com/article/idUSN0659131420100406?rpc=44

update II temo charts on some movers

http://temo1051.blogspot.com/2010/04/charts-slvssrislw-and-sol.html

Monday, April 5, 2010

Palladium Physical Price Hits 2 yr High

Joe mentioned early in January watch out for palladium which he thought would do well especially SWC, today Palladium hit 2 yr high:

Palladium rose to a two-year high above $500 an ounce on Monday, and sister-metal platinum reached its priciest since August 2008 backed by strong investment demand due to an improving auto-sector outlook.

A softer dollar also bolstered equities crude oil and gold, which rose to a near one-month high.

Inflows into the U.S. platinum and palladium exchange traded funds and optimism about the global economic recovery have spurred buying of the underlying platinum group metals, which are used in the auto industry for catalytic converters and also in jewelry.

Platinum was underpinned by worries about rising cash production costs, production interruptions, and a lack of adequate power supply in South Africa, the world's largest producer of the metal.

"The global auto recovery, the impact of the softer U.S. dollar, and potential supply concerns out of South Africa are driving platinum group metal prices," said William Rhind, strategic director of ETF Securities Ltd' U.S. unit.

Spot palladium rose to $500.50 an ounce, its strongest price since March 2008. In late New York trade it was at $500 an ounce, up from $490 late the previous session on Thursday.

New York June palladium futures settled up $16.65 at $508.00 an ounce on Monday.

Palladium and platinum prices began to rally in January after London-based ETF Securities launched the first U.S. platinum and palladium funds, which now hold about 900,000 ounces of the combined metals.

"There is strong investment demand in the U.S. because of the platinum and palladium ETFs, and the recovery in the auto sector, particularly in the very strong developing markets, such as China, has led to a pick-up in demand," said Carlos Sanchez, precious metals analyst at commodities consultant CPM Group.
http://www.reuters.com/article/idUSTRE62H1MP20100405

RAMMA JAMMA BAMMA

And the band plays on. The march of the light brigade continues. The inexorable climb to glory. The ponzie play remains alive and well to preserve the life of our free markets.....cough cough puke. Sorry... Well I guess my 61.8 fib call is within easy reach now and my fear is telling me they want to go higher. Uncle Joe says they can and I agree.....so shorties be careful. Why should I strain my brain today...just read this "mainstream piece". OMG we are so screwed.

NEW YORK (MarketWatch) -- Paranoids notoriously have enemies, but sometimes they have friends too. Long-derided financial conspiracy theories are finally being reported in the mainstream media. Could be ominous.

In some ways, this situation is similar to the way in which conspiracy theories about the nefarious role of mega-investment-bank Goldman Sachs /quotes/comstock/13*!gs/quotes/nls/gs (GS 171.32, +1.10, +0.65%) finally went mainstream last year. ( See July 20, 2009, column.)

The difference, as I predicted then, is that the theories have now spread to include possible manipulation of financial and particularly gold markets -- and ultimately raise grave questions about the fundamental probity of key U.S. financial institutions.

One example: another remarkable article by ferocious Goldman critic Matt Taibbi, posted March 31 on Rolling Stone magazine's Web site. (See "Looting Main Street.") It purports to chronicle the way in which J.P. Morgan Chase /quotes/comstock/13*!jpm/quotes/nls/jpm (JPM 45.01, -0.19, -0.42%) managed to saddle Jefferson County, Ala. (containing the city of Birmingham) with more than $5 billion debt for a sewage system originally supposed to cost $250 million, bringing it to the brink of bankruptcy.

(Goldman Sachs wasn't involved -- because, Taibbi says, J.P. Morgan paid them $3 million to go away.)

If Taibbi is right about this Alabama atrocity -- and he says that there have already been more than 20 local convictions for corruption, plus an SEC fine for J.P. Morgan -- then anyone dealing with Wall Street is in effect putting themselves in the hands of the Sopranos. It's hard to see how any economy can survive this sort of predatory parasitism.

Another example from the liberal media (where are the conservatives and libertarians?): Nathan Lewis' March 31 article in the Huffington Post: "It's Ponzimonium in the Gold Market."


Lewis reports the recent testimony before the Commodity Futures Trading Commission by Bill Murphy of the LeMetropoleCafé Web site. Murphy is what I call a radical gold bug, who believes not merely that gold is an inflation hedge but that the gold market has been manipulated in the interests of sustaining a financial bubble. ( See Dec. 7, 2009, column.)

Additionally, however, Lewis makes an exceptionally blunt statement of the case that there's widespread deception in the institutional gold world, so that customers who think they own bullion actually own "unsecured gold loans ... at a negative interest rate." He predicts a scramble to take delivery of gold -- which would work like a bank run -- and massive dollar decline.

One radical gold bug subscription Webzine is currently predicting that what radicals call the "Gold Cartel" is about to take both gold and stocks down sharply. The Deepcaster service (posted here) says:

"Ominous Reverse Head-and-Shoulders (Bearish) are forming both for bullion and the [gold] shares. Yet both their Upward Trend Channels are still intact."

"But, of course, the fact is the fundamentals for gold and silver remain extremely bullish. If it were not for Cartel intervention, gold would today be over $3000/oz and silver over $75/oz, in our view."

"But we also repeat that the Cartel is still potent, delivering $50 down days in gold in early December 2009 and early February 2010."

"It IS becoming harder and harder for the Cartel to implement successful takedown attempts, because more and more investors are becoming convinced, rightly, that they should buy physical gold and silver on the dips, and hold it personally."

"But the Cartel's 'bottom line' is that it cannot afford for gold and silver to be seen as 'go-to' assets in the face of a Cartel takedown of the equities (or commodities, for that matter) markets. The Cartel's entire game plan depends on the ability to continue to successfully suppress gold and silver prices."

"Thus the Cartel attacks on gold and silver will likely continue," the Deepcaster

Sunday, April 4, 2010

THE REAL EASTER BUNNY

I woke up this morning and immediately realized that the easter bunny had visited my home. There were small gold easter eggs hidden throughout my house and I knew immediately that the pagan holiday of kli was alive and well. I hurried around the house and began collecting the valuable gifts before the shark Joe knew they were left there and swooped in for the kill. I spotted an especially nice one glistening behind my desk an virtually jumped to reach it falling and striking my head on the hardwood....which jolted me out of my Easter egg dream and back to reality. It was really depressing for a few moments this morning until I realized it was only human greed. The old human weakness of avarice taking over my dreams now. I even was trying to get all of those eggs before my little babies got up and of course before Joe got there....that baastid. I knew the rest of the blogasphere wouldn't know they were there but that Joe was another problem. Happy bunny day all gl....

March 18 (Bloomberg) -- Central banks added the most gold to their reserves since 1964 last year amid the longest rally in bullion prices in at least nine decades, data compiled by the World Gold Council show.

Combined holdings rose 425.4 metric tons to 30,116.9 tons, an increase worth $13.3 billion at last year’s average price, according to the data. India, Russia and China said last year they added to reserves. The expansion was the first since 1988, the data from the London-based council show.

Central banks, holding about 18 percent of all gold ever mined, are expanding their holdings for the first time in a generation as investors in exchange-traded funds amass bullion as an alternative to currencies. Holdings in the SPDR Gold Trust, the biggest ETF backed by the metal, are at 1,115.5 tons, more than the holdings of Switzerland.

“There’s clearly been a renaissance of gold in central bankers’ minds,” said Nick Moore, an analyst at Royal Bank of Scotland Group Plc in London. “It’s not just been central banks taking on gold, but a general shift for physical gold in the investment sector.”

Official reserves of central banks and governments may expand by another 187 to 218 tons this year, CPM Group forecast last month. The council’s data also includes the holdings of the International Monetary Fund, European Central Bank and other international and regional bodies.

Gold climbed 24 percent last year, reaching a record $1,226.56 an ounce in December. World holdings rose 527 tons in 1964 and climbed 832.7 tons the year before that, according to the London-based industry

‘At the Edge’

“Gold is quietly, at the edge, becoming the world’s second reservable currency, supplanting the euro and rivaling the dollar,” Dennis Gartman, a Suffolk, Virginia-based economist and hedge-fund manager, said in his Gartman Letter today. “The trend shall continue months, if not years, into the future.”

Gold is up 2.7 percent this year and traded at $1,126 an ounce at 11:29 a.m. in London. The U.S. Dollar Index, a six- currency gauge of the greenback’s value, is up 2.7 percent this year after slipping 4.2 percent in 2009. Bullion typically moves inversely to the U.S. currency.

Higher prices for gold, especially in euros and sterling, may deter countries from adding further to reserves, RBS’s Moore said. Bullion climbed to a record 838.43 euros on March 5, Bloomberg data show.

“Central banks might feel somewhat embarrassed to be buying gold at records” in some currencies, Moore said. “When you have an asset trading at an all-time high, the temptation is not to purchase more.”

in case you missed this

http://kliguy38depression2news.blogspot.com/

Saturday, April 3, 2010

KLIGUY VS MIZE ...CLASH OF THE WIENERS

After several posts here and debates on the SKF board with Mizesaw over whether the U.S. can land in a JapanII scenario or in a more severe catastrophe. These are real economist debating an issue that is the essence of our current Fed efforts...take special notice of the personal take in this article about the unspoken demographic issue I keep bringing up. Its an albatross around the developed worlds "recovery neck".

Agree or disagree, the fact that two of the smartest economists in the world can present very persuasive cases for either side indicates precisely the conundrum we are in, and is precisely why the Fed will pretend it is operating in the shadow of a so-called Goldilocks economy, even as it prints record trillions of new debt until one or the other is proven wrong. If, as many expect, Grant ends up being correct, than Bernanke will have gambled and lost the future of the United States.

Some of the more persuasive arguments by both include a refutation by Grant that the US economy now is in any way comparable to that of Japan, for a variety of reasons, namely the underlying domestic "dynamism." Rosenberg disagrees and presents the trend pricing for JGBs which, even with record ongoing debt/GDP and deficits, has seen a contraction in JGB yields by 70 bps, even after a round of downgrades.

For traders, the recent move wider in bonds, as well as the first time ever observation of negative swap spreads is likely a warning signal that the 10 Y may finally be breaking out of the 3.20% - 3.80% range where it has been stuck for the past year. If yesterday's post NFP move is any indication, we will likely see a 4.00%+ print in the next week, after which the next resistance level is in the mid 4's.

Our personal take is that the key factor that is least discussed by pundits, is the demographic shift in both Japan and the US, with both populations aging, and a record number of Americans entering retirement age over the next 5 years (and discovering that Social Security is bankrupt). To believe that this cohort will invest in equities is about as stupid as saying that IT is the current GARP sector of choice. What is the alternative? Corporate bonds may be reaching an adverse inflection point as both foreigners and Primary Dealers begin to pull out - is the slowest money, mutual funds, about to follow? Will the next big move be a derisking exemplified by a shift into Treasury funds and an increase of the Household purchases? Unlikely - we have seen that the savings rate has just dropped to its lowest level since 2008 of 3.1%. Consumers are once again running out of investable cash, and instead are loading up on one-day fad trinkets like Kindles. On the other hand Primary Dealers, which usually are a harbinger of things to come, have increased their capital allocations to bonds dramatically over the past several months. Or will the shift be a derisking one? Also unlikely, due to the primary demographic observation highlighted above, and also with the majority of the population having sat out the bear market rally (intuitively aware that it is based on one-time, non-recurring fiscal and monetary stimuli), which is logical: just the richest decile of the population tends to benefit from blistering bear market rallies. To be sure, Uncle Sam is waiting on the other side with the IRS taxman to take his share. Also, domestic equity mutual funds have seen a substantial $3.5 billion outflow in 2010: why should that suddenly change?

http://www.zerohedge.com/article/jim-grant-takes-david-rosenberg-and-bond-bulls-warns-fed-chairman-watch-your-back-ben-bernan

Friday, April 2, 2010

CAN YOU DO THE MATH? update II

When the open interest in silver futures contracts exceeds 800 million oz., and when the silver on deposit for delivery is a mere 50 million oz., it does not take a genius to figure out that something is out of balance. That's only a 6% backing!

When the London OTC market trades in excess of 125 million oz. of silver per day, and only has 75 million oz. of physical in the vaults, again, it does not take a genius to figure out that something is out of balance there, too. The BIS notes that the OTC "over the counter" other precious metals derivatives exceed $200 billion, which is about 12 billion oz. of silver, or almost 24 years worth of mine supply, and 160 times the 75 million oz. they have left!

It should not take any hearings or investigations. But the investigations serve the purpose of revealing the numbers to CFTC commissioners who may not otherwise know.

The London fraud is easier to understand, even though it is bigger. Why? In Europe, there is the VAT, and on silver, it's about 17% if you take your silver out of the banks, and take delivery. Therefore, most people leave it with the banks. But there is no "it", no silver.

YES, THIS IS THE WORLD'S BIGGEST FRAUD! BIGGER THAN EVERY OTHER FRAUD, EVER! PERHAPS BIGGER THAN ALL OTHER MONETARY FRAUDS IN THE HISTORY OF THE WORLD, COMBINED!

The world's gold market is like a Ponzi scheme, or bucket shop. Around 100 years ago, there were brokerage houses (bucket shops) that let you buy stocks, and they would give you a receipt, but they would not buy the stock, they would simply buy back your receipt if the stock went up, and if you cashed in your receipt. Two big "ifs". Jesse Livermore wrote about the bucket shops in his famous book, "Reminiscences of a Stock Operator".
http://www.amazon.com/reminiscences-stock-operator-edwin-lefevre/dp/0471059706

The government eventually put the bucket shops all out of business, because they were all fraud. (Also, the government banks don't like competition.)

Jesse notes that the bucket shop trading was different than a real market, as you would not move the market price of stocks you bought or sold, and so, you could buy the stocks cheaper, not paying such large commissions, and also, not moving the market price up against yourself as you were buying.

Same thing in the gold and silver markets. The big brokerage houses promise silver at lower commissions, but only if you don't ask for delivery.

The gold and silver markets are no different than a bucket shop, it's cheaper, but if you don't take delivery, your silver does not exist.

http://news.silverseek.com/GoldIsMoney/1270170340.php

Watch my imaginary scenario play out today......good job numbers and tightening by the Fed on Monday with bonds trying to flatten out the curve. It is all part of the grand experiment AND it is also an attempt to extricate themselves from the Rock and a hard place....should take the market down and then squeeeeeze the shorts as they have moved back into their positions....wash rinse repeat.

update I must read this week

http://robertreich.org/post/489217942/the-fed-in-hot-water

update II fun watch...also pick up on the right links too

http://www.youtube.com/watch?v=L8sI_I9BTPw&playnext_from=TL&videos=2tf4jvhLZAg&feature=sub