Saturday, January 4, 2014

BERNANKE BUBBLE TROUBLE

NO ONE can possibly know the exact timeline of the "pop" or in what manner the "pop" occurs to this latest bubble creation. Its nothing to create a massive market bubble, so don't be deluded by the usual bubble rhetoric that ALWAYS occurs at the top of bubbles. 

The "doom and gloom" rhetoric tends to be stifled by the louder boasts of the latest bubble riders and paid promoters of the casino. Public capitulation of the loudest bears becomes public fodder on many public financial sites as the final distribution of shares from the smart money to the dumb money transpires. The cries of a "further 8% move" become almost deafening. Why not jump on? Everyone now is predicting a long, lasting, "recovery". Even  some of the previous loudest bears are saying we could see a rally into the latter half of this year as Europe and the U.S. recover. Ignoring now the previous macro rationale  for their negative outlook, they have suddenly began crouding onto the "other side" of the boat. As the market reaches into RECORD Bull market timeline and RECORD Bull market numbers the bears begin to turn more BULLISH. 

How MIGHT the resolution of this bubble occur? Bernanke is gone and a new Chairman is arriving. One only needs to go back a few decades to see what the scenario MIGHT be by examining what happened as the last two exchanges of the baton looked like. Historically when Greenspan took over from Volker after a similar 5 year bull run a sudden and violent two day crash occurred just a few months after his tenure began. The 2007-2009 Great Recession and market crash occurred shortly after Bernanke took over from Greenspan. So you see there is NO implied "grace period" for the newly arriving Fed Chairman. In fact if one is looking at a market bubble AND a newly arriving Fed Chairman then one should be wary of playing in the great casino at least based on past performances. But of course the temptation is very strong. How can one ignore the money being made recently. How can one ignore the gains made in high flying stocks like Twitter, Amazon, Chipotle, Starbucks....etc.......?? Its intoxicating. The allure is overwhelming. How can you resist?  All you had to do was just buy the dips and hold on for a few weeks and you could have traded them for tidy profits.....OR better yet you bought the dips and held them for gains 200%. One cannot resist those type potential gains. Worse yet......IF you missed them, you feel the need now to CATCH UP. You know what I mean......YOU'RE GETTING LAPPED. 

Those unending voices beckoning you to the game. Telling you that if you're worried we're near a top then JUST use protection. You can be cautious. Buy puts, sell calls.....just keep your stops close.....you know what to do, its easy......"look at me, I'm not that smart and I made a ton". Those are the voices at the top of a market top and NOT the beginning of a bull market. 

In 1987 during a relatively prosperous economic boom in this country, one day after a particularly ugly correction the prior day in the market, we experienced a massive sell off in one day of 22.6% and this was even with the market shutting trading down intraday. To this day there is absolutely NO explanation WHY this sell off/crash occurred. Theories abound, but strangely NO ONE ever established a sound explanation, after multiple forensic analysis just how and why it actually occurred. 

In 2000 the voices once again shouted to the moon how high the Nazdaq could go. Once price targets were hit on on high fliers like Cisco Systems, WorldCom, etc. they would trot out the same analysts and a higher target price would be established. Seldom did you hear mention "take your profit and run". They always had an explanation for a "higher" target price. Even the phrase "its different this time" popped up. Well it wasn't and once again they flushed the "dumb money". It wasn't the end of the world either. It was just another pump and dump at the casino. The World's economic health was stronger those previous dumps with less worldwide debt and certainly they didn't have 1.5 Quadrillion in derivatives hanging over the game. Maybe the doomers will have their day with the JIT delivery systems and the fragility of the interconnected World economies straining to maintain their social/political balances, but there is one thing certain.......its not "different this time" in the great casino. They suck the dumb money in during distribution and then short market into oblivion and soak up the shares at a big discount to run the whole game over again. gl








113 comments:

  1. Jim Sinclair’s Commentary

    George Soros recently acquired a substantial stake in the large-cap Market Vectors Gold Miners ETF (GDX) and kept his calls on Barrick Gold (ABX)......

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  2. Jay - read Bud's post for the value they provide - a chuckle. Psst - don't tell Bud that Buffett has been unloading IBM shares (and his favorite holding period is forever according to Buffett).

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    1. Yeah Inlet......he traded them in for Twitter shares

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  3. Jay, one thing to realize is that you and I are in our mid-30s and have a long time horizon, whereas folks like Kli, Tom, and the senile old fool Inlet often come across as bitter and angry. I've found doomers to fall in two categories: miserable, unhappy people who want others to be miserable, and those who try and profit from it by preying on people's fears and hyperbole. And of course you have people like Inlet who, due to loss of cognitive function, should be treated like a child, so just ignore him.

    Now, lets talk some real stuff. Contrary to what Kli has been putting in my mouth, I have never advocated entering the market at current levels. Only a fool would go all in at all time highs trying to cash in on this bull run. If you sat out the last 5 years, you missed a great opportunity and there's nothing you can do about it. 2013 especially was a straight shot up, and it's highly unlikely that we'll get anything close to that in 2014. I expect this year to be far more volatile, with a couple of double digit corrections, but the markets should end the year higher, probably in the 7-10% range. I see further upside well into 2017-2018 before we enter the next potential multi-year bear run.

    I first started investing 13 years ago when I entered the work force and enrolled in my company's 401k plan and also opened a couple of IRAs. I had a small trading account which was wiped out during the dotcom crash, so definitely learned some lessons there. When it comes to my retirement accounts with the long time horizon, I follow a very boring and conservative approach. It's about indexing and lazy portfolios. I've stayed with this formula since day one, and thru regular contributions and employer matching, plus ignoring all the noise, I've amassed a very respectable sum, all by age 35.

    I rebalance these accounts once a year, and pretty much stay away from trying to time the market. I expect this to serve me well in the next 30 years, so I will continue to stick with it.

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    1. Jay - realize Bud is totally lacking a sense of humor. As long as he responds as he does to my digs I will continue to jab him. He needs to take $20 and buy a sense of humor.

      As to being a angry old man nothing could be father from the truth. I wake up every morning thankful for what I have. I am most thankful that I have not had a day in well over a year that I felt bad. I am thankful for a merciful God. I am thankful that I have sufficient resources to meet my needs. I have no debts (unless you count the charges I pay off each month on my CCs that I use as a matter of convenience) - no mortgage, no auto loan or lease. Living in the Southeast all taxes (except sales) are very reasonable. My monthly "necessary" expenses are probably less than a months rent in NYC.

      BTW - I was able financially to retire at 55 (which I did) BECAUSE I got out (early for sure) and did not get wiped out by the dot com bust unlike Bud. Hehehe.

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    2. Bud's still learning Inlet........can't wait to see him retire on his "passive income"

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  4. [continued]

    Now, another goal of mine is to create meaningful passive income in the next 10-15 years. Once my house is paid off, the other expenses will not amount to much. I hope to semi-retire at that time and have the freedom to do what want. For this, I decided to build a portfolio of dividend paying stocks 4 years ago. I don't chase high yields, just look for boring but stable companies that have a long history of increasing dividends no matter what the market does. I'm up to 12 stocks and earned $2700 last year just from the payouts. Luckily, I don't need the money so the dividends were re-invested. I'm trying to get to about 25 stocks here, and really hoping for a nice correction so I can pick up some cheap shares. This is another fairly unexciting strategy, but thru
    regular contributions, dividend re-investments, and of course the markets, it's amazing how much this account has grown.

    Lastly, I have a play account. Thanks to a well-paying job, I'm able to fund all my other accounts, and still have enough left over to do this. I take big risks here, sometimes they pay off, sometimes not. Any profits from the play account are used to build up my emergency cash fund, which is now up to almost 18 months of expenses.

    I'm also a big fan of cash. Right now, I'm about 50% cash in my dividend and play accounts, waiting and trying to decide what to do next. No plans to enter the markets at current levels, unless any of my targets on individual stock are hit.

    It's not all paper, of course. I have a 2/3 paid-off house, and numerous other hard assets in my possession. If and when gold falls to sub $1000, I intend to move as much as 5% of my net worth to gold, as a sort of catastrophic insurance policy.

    So there you have it. I hope you have a retirement plan at work that lets you implement an indexing strategy and/or pick one of several lazy portfolios. These are time-tested and they work, provided you tune out all the noise, especially the doom and gloom, sky is falling, dollar is toast talk. In Aug 2009, Kli was predicting that the $ would not last beyond a year, and that after hitting 1225, the SPX would begin the hard down P3 phase. Well, I don't have to tell you how that prediction turned out. The nice thing about the Internet is that everything is available for you to search. Reading doomer predictions from the past and how wrong they were is a favorite pastime of mine. I believe the next big prediction is that 2014 is the year the S really HTF. I predict around next December, we'll have a nice laugh about all that.

    My advice is simple, there's a sea of information out there, so do your own research, come up with a plan based on your time horizon, risk tolerance, and other goals, and then move forward. Most important, do not give in to fear, talk of doom, and hyperbole.

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    1. You seem to have no concerns about the system bud yet you maintain you're going to move as much as 5% of your worth to gold IF and WHEN it falls sub 1000$....number one you have categorically stated several times it is ABSOLUTELY going to sub 1000 so why IF....and WHY do you denigrate all the "doom and bloomers" yet you a "sort of catastrophic insurance policy". You contradict your "certainty" right in the middle of your "plan". Someone with your disdain for gold thinks its some type of "safe haven". So basically you want to have your cake and eat it too. The obvious exploding Fed balance sheet and global debt disaster is "crying wolf" or "the sky is falling" if its discussed or linked on this forum according to you......but .....you will buy gold IF it goes sub 1000....hhehehehehehehehe......OK bud. That's like saying I'll buy insurance for my house only if it falls below a certain price......because it MIGHT fall below that price. You need to post more Bud, it helps all of us become more logical and more introspective.

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    2. Budfox,

      Thanks for sharing.
      I am older than you and also religiously added for my 401k/Profit sharing plans as soon as I was earning money. I too have done well through the years and just rebalance once or twice a year. I did well this year too.
      However, I have stopped adding to my Profit-sharing plan last year and will likely will not add to it anymore. My concern is that large pool of retirement savings will have more and more taxes & fees added to it as the future progresses. It just seems to me that our retirement funds will be the "big cookie jar" that our government will not be able to keep their hands out of.
      So, although I am paying extra taxes now, I have extra money at home which I can use as opportunities arise.
      I too agree that the market will likely work itself higher this year, but I am still following Martin Armstrong's timeline indicating problems in the 4th quarter of 2015.

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    3. Doc - you nailed it. Retirement accounts (IRAs, 401Ks, Profit Sharing, etc.) are going to take a haircut in the future to fund all the social welfare programs. Will it be a 10% (or more) tax on savings or will it be a less direct approach such as surtaxes on the funds as they are withdrawn? It does really matter how - the point is it will happen because there is no way to fund future welfare programs (including medical and social security) based on current demographics and GDP growth.

      Given the failure of our education system you can expect the growth since WWII to be a high water mark as future growth slows. That means taking from those who have and distributing to the have nots. I totally appreciate Bud funding Social Security and Medicare for my benefit. Hehehe It makes me happy (not angry as Bud contends). LOL

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    4. Bud is young inlet and "believes" ...he believes that his "well funded retirement account" will be protected by the Government from the ravages of a weakening dollar and the marauding hands of a Government that has promised more than it can deliver. I have also a large amount of money in retirement accounts and feel very certain that a large portion of it if NOT ALL will be confiscated in some fashion..... fortunately I have other assets to compensate this event but nonetheless I wish I were able to keep my retirement money........ask Detroit pensioners how it feels

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  5. the only correction I see on MY predictions was the "dollar would not last the year"....I have never made such a prediction. I did predict the SnP would hit 1225......but your post has at least some timeline.....double digit correctionS this year really pulls in a lot of territory....For someone as experienced as yourself in the market and with such a large portfolio of expertise perhaps you might give us some timelines on these corrections....at least let us know how deep so we can "enter long".....the market had several of these "double digit corrections" in 2001 AND 2008.....the problem was they were consecutive and you would have been wiped out (AS YOU WERE) in 2001 if you had entered them early on......NOW having said that YOU did post the market would end UP this year so MUST be anticipating entering long on these "corrections". Any technical indicators that you like to use would be helpful for us to watch for or is this just on your "gut"....after all after a five year massive bull run a couple of quick small "double digit" corrections would be "quite unique".....now....are these cyclical "bear" corrections in the next few months?....OR are they "less than bear" corrections???? Please expand since this prediction is so unusual in market history.

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  6. BTW bud since there is a "sea of information" out there perhaps you can share with all of us "some" of your "favorite links"....I'm sure some of us are capable of reading you information.

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    1. That sea is full of "information" sharks like MSM and financial gurus. Bud may get eaten by a shark. LOL

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  7. The dollar is "toast" by the way bud which is what I have ALWAYS said.....they are already destroying it along with most Western currencies ...THAT is what the gold and precious metals manipulation is REALLY all about. Again I appreciate your "wealth of experience" and will await some support and clarifications on when we can enter on these "double digit" pullbacks.

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  8. Doc.........virtually all of the bears like Armstrong, Rickards, Rogers et al expect a blow off top on the dow for the last distribution phase to work out............obviously all of the bulls are long too and expect further upside. My concern would be that the market ALWAYS punishes the most people mathematically possible.......and it will this time also.

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  9. "I rebalance these accounts once a year, and pretty much stay away from trying to time the market. I expect this to serve me well in the next 30 years, so I will continue to stick with it." If this is true then reconcile it with your next statement

    "I'm up to 12 stocks and earned $2700 last year just from the payouts. Luckily, I don't need the money so the dividends were re-invested. I'm trying to get to about 25 stocks here, and really hoping for a nice correction so I can pick up some cheap shares. This is another fairly unexciting strategy, but thru
    regular contributions, dividend re-investments, and of course the markets, it's amazing how much this account has grown.

    Lastly, I have a play account. Thanks to a well-paying job, I'm able to fund all my other accounts, and still have enough left over to do this. I take big risks here, sometimes they pay off, sometimes not. Any profits from the play account are used to build up my emergency cash fund, which is now up to almost 18 months of expenses.

    I'm also a big fan of cash. Right now, I'm about 50% cash in my dividend and play accounts, waiting and trying to decide what to do next. No plans to enter the markets at current levels, unless any of my targets on individual stock are hit."

    You DONT time the market and yet you are 50% cash......then what are your other stocks/positions. AND if we're all doomers then WHY are you in 50% cash and WHAT is your "pullback"/ "entry" level .....HOW do you determine this very key part of your strategy when you categorically state you are NOT a market timer.......what the hell do you call those statements then???

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  10. October 21, 2013
    Notes From Jim Sinclair Q&A Session Today Near Dulles Airport

    http://www.worldofwallstreet.us/2013/10/notes-from-jim-sinclair-qa-session-today-near-dulles-airport.html


    I will be at Jim's Q&A meeting on Febuary 8th.....I will take notes

    it will let me hook up with my GATA freinds

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  11. this one's for the buds out there

    http://www.bloomberg.com/news/2014-01-04/feldstein-joins-summers-predicting-stronger-u-s-growth-in-2014.html

    for the past three years we have had prediction of GDP normalization to yearly 3.5 even 4.5 last year predicted........and even with their channel stuffing/ seasonal adjustments it just flatlines.......but hey!!! if you all want to believe this is just like the late 70s early 80s........be my guest.........I was there and I will tell you this is NOTHING like that time period. We had good paying jobs in manufacturing ( a wide array of heavy industry and tech) ....we had virtually ZERO debt. UNDER 1 Trillion. After 2000 crash they made the decision to leverage housing and use derivatives to expand the liquidity base to "stimulate" the banking sector er economy. It did create a mini boom of good paying construction jobs and spending in Home Depot etc with the subsequent flipping of real estate etc.......it worked.......but it was an illusion and NOT sustainable. We have not addressed the structural job loss of outsourcing our manufacturing which is one reason we have to maintain the military industrial complex. Without that segment we are in anarchy overnite. It the boiling the frog analogy and I'm just as guilty as some in "wanting" to believe it can go on indefinitely. I have one advantage over many of you. I live in both worlds ......the very rich and the very poor. I prefer the poor. They're real and they can skin a deer if they had too. But what bothers me is the increasing unease within the have nots and their outlook ( mind you some are just as smart as my elite friends and some smarter) is beginning to take a very uncomfortable turn as reality sets in. There's nothing on their horizon. I intersect almost daily very personally another element and these are the disenfranchised. That element is at the end and they are the ones on food stamps, gov aid, etc etc.....they KNOW they're going nowhere. NONE of this existed in any substantial amount in 1979.....We knew it would turn

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  12. Estimates of $15 Trillion spent on the War on Poverty...in 1993, it was $5 Trillion so triple that amount, but the poor are poorer and the middle class is disappearing. Even without a SHTF scenario, this does not bode well for our country or ANY country. Congrats to you budfox for being an elite...every Fed Chairman has created a bubble, they seem to know nothing else. Even Volker, with the PMs. It's hard to imagine that this bull will continue past Martin Armstrong's Oct. 2015 but we'll see. I wish I understood his assays. GL in the New Year everyone.

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    1. as time passes sister I find Rickards to have been easier to follow and very accurate over the past four years. He certainly called the miner and gold beatdown. Jim Rogers has also been very acccurate for the ENTIRE time I have followed him and has been very negative on gold and miners for three years. Not so negative on gold now but still negative on miners.

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    2. Thanks as always. Like the 2 of them; followed Jim Rogers from Day 1. Read all of his books.

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  13. http://blogdogcicle.blogspot.com/2014/01/government-labels-people-like-snowden.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+blogspot%2FzklEV+%28blogdog%29

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  14. http://blogdogcicle.blogspot.com/2014/01/detroits-chief-of-police-says-more.html

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  15. http://www.brotherjohnf.com/archives/256042

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  16. from Jesse (another doomer bud reads but doesn't apparently listen to)






    Comex Warehouses: Potential Claims On Deliverable Bullion at Historically High 80 to 1







    “When you can measure what you are speaking about, and express it in numbers, you know something about it, when you cannot express it in numbers, your knowledge is of a meager and unsatisfactory kind; it may be the beginning of knowledge, but you have scarcely, in your thoughts, advanced to the stage of science.”

    William Thomson Lord Kelvin


    I think we can stipulate that the lack of real transparency in the precious metals markets, among many, is appalling. But that is the nature of our fraudulent times.

    January is a non-active month for the metals, and overall inventories are adequate for the meager deliveries on the Comex.

    Those who hold bullion will need some incentive to move it to the deliverable, registered category for February, which is often a significant physical delivery month for the New York paper markets.

    But all in all, the Comex is now the tail wagging the dog, a paper sideshow to the real bullion markets which are moving East.

    This is something that very few economists have yet to internalize.

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  17. IT WAS THE WEATHER DUMMY!........hehehehehe......only in buds world can this type of explanation be allowed to stand. Even the speaker can't keep a straight face when he tells it


    http://www.bloomberg.com/video/why-did-every-single-car-maker-disappoint-rsBygRBCRWyniDXDIewTtQ.html

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    1. What amazes me is the amount of subprime auto loans out there. Add in student loans (many in default) and it is approaching subprime mortgage debt in 2007.

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  18. where's George Bush and Dick Cheney when you need um........Lets go back in.....CHAAAAAAAAAAAGE

    http://www.debka.com/article/23571/

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  19. Just realized its not gold the really scares them.....its silver. they can't control it if physical possession ramps up from here.........gold they can to some extent........NOT silver.....gl

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  20. Why do you say silver cant be controlled they have done it for 2 years now

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  21. Gold supply above ground is enormous and they have multiple ways to manipulate it but they always have price as the ultimate mover of needed bullion. Silver above ground supply is much more limited and is in very strong hands now. WHEN and not IF the paper control mechanism unravels on silver they don't have the above ground stores to move like they do GOLD.......silver IS their achilles heal....the physical price could get well over 100 before they can even get brakes on it.

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  22. I do agree that silver is to me much more interesting due to its industrial uses. So basically a short squeeze would be the cause of the movement. I like silver but I try to keep a 10-1 ratio of silver to gold holdings because thats the historical norm on price. With that being said silver has some catching up to do. Been making monthly buys to diversify and average down. Thank you for this page and info. I really enjoy it. It

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  23. Silver's industrial consumption coupled with the history of "real money" make it the perfect tsunami if gold breaks out. Right now the buying of silver bullion remains strong but when the demand ramps up from whatever the trigger is .......the above ground supply just isn't there like it is with gold. This is why they have always defended it ( see Hunt bros).......is this time different? Not really.......just more delicate and certainly its move may be quite volatile until they can shake loose some weak hands. Unfortunately the grade of mined Silver is also slipping like gold and they are trying to establish control of the most productive silver mines for the cartel as we speak. This has been taking place for several years quietly.(gold too)......Its not discussed on any blogs of course nor will it be. No silver or gold mines will be leveraged buyouts.....unless its given approval by the cartel. Please note the accelerated bullion buying by China and Russia to mention a few. The time for currency wars is nearing its culmination and without bullion it will be very difficult to have a seat at the table.

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    1. Even Sinclair knows silver will be the big money maker and he's the "king of Gold"....but look who Volker brought to the table to liquidate the Hunt bros. vast silver stockpiles/COMEX position. and he knows very well where and WHO got the bullion. Much of it was used for industrial use and price suppression during the 80s and 90s........NO ONE really knows how much bullion can be left to access for "run on the silver bank" but when the strain appears this time some very important cracks will break wide open exposing silver for what it really is and that is a truly "precious metal" that's why this defense is so important at this level. It will break

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    2. lastly ....you hear pundits coming on CNBS with gold price targets but NEVER Silver price targets ....crickets

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  24. Jim Rickards: There are no more markets. When you manipulate the dollar you manipulate either directly or indirectly every market in the world. As a result the markets send false signals and do not provide price discovery. If you read between the lines, they don't know what they are doing. This is not the first taper. They have done it after QE1 and QE2 and the taper failed both times and they started it up again. I think they are tapering into weakness. We have an unstable situation with inflation and deflation, and it is like standing on the San Andreas Fault when nothing is going on. I think we can certainly expect much greater volatility in 2014. America is in a depression. Gold is going to betwen $3000-7000. 500 tonnes has come out of GLD and it's going to China. Price suppression is unstable, and it will not endure in the long run.

    David Bond: Silvercorp got an early Christmas present. The British Columbia Securities Commission accused one Jon Carnes, a.k.a. Alfred Little, and his hedge fund, EOS Holdings, of lying about Silvercorp's operations. Carnes disguised his authorship of the critical reports by using the pseudonym Alfred Little. After his Sept. 13, 2011 report questioned the quality of the miner’s silver resources, the stock of the Vancouver-based Silvercorp dropped 20% in a day, earning EOS Holdings almost $2.8 million on its short sale and option trades.

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  25. You can't make this up.......heheheeh.......slap on the wrist 2Billion for aiding and abetting Madoff........hell they would never have been caught except they let Madoff get greedy and go after some "rich" Russians.........that was a big mistake. When they paid Bernie a visit ..........he knew he would only be safe one place.....in prison so he confessed to save his life........it didn't work out so well for two of his partners and a son..........two were "suicided" and one partner was "heart attacked" swimming laps in his pool..........hmmmmmmmmm wonder where we've seen that before.......no witnesses to any of these........enjoy the casino......hehehehehe

    http://finance.yahoo.com/news/jpmorgan-nears-2-billion-settlement-035549648.html

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    1. Oh wait........this is all conspiracy......just your everyday 55 Billion Con......nevermind ....don't worry about those retirement accounts.....just keep adding......your young and when you retire it's all gonna be there waiting for you. Madoff is just a "one off" gambit and JPM was "just asleep at the wheel"........hehehehehehhehehehehehehe

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    2. A government official told Reuters last month that the U.S. Treasury Department's Office of the Inspector General was examining whether JPMorgan interfered with the OCC's attempts to probe the bank's relationship with Madoff.

      Madoff had also separately told U.S. authorities that JPMorgan - the bank he had used during his decades-long investment scam - had tried to stop the OCC from getting information about their relationship.
      Rueters

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  26. Let me see if I can answer everything in one shot.

    Kli, why would people buy flood insurance? Earthquake insurance? Umbrella policy? Catastrophic health insurance policy? So that if the unthinkable happens, you're not wiped out. To me, buying a small amount gold is a similar insurance policy for my financial portfolio. I disagree with all of your dire predictions, but in the extremely unlikely scenario that you are right, then at least I have something to stand on if the dollar and all my accounts are wiped out in some reset. Does that make sense for you?

    As to market timing, I think I made it pretty clear that my long term retirement accounts are in boring investments like indexes and lazy portfolios. When it comes to my taxable accounts, of course I'm more active. A time such as now, with markets near all time highs, I raise cash and wait. If we get a correction or a specific stock on my watch list reaches my target price, then I buy it regardless. Buy low and sell high. In case of my dividend accounts, buy, re-invest the dividends, and hold. What part of this do you object to or not understand?

    This is a pretty comprehensive disclosure of my entire financial plans (past, present and future). Based on what I see around me and read, I've done reasonably well for myself. If you disagree, feel free to share what I could've done better and different in the last 13 years. As to getting wiped out in 2001, well I was 23 years old and didn't know what the hell I was doing. Better to learn those lessons when you're young and not repeat them again.

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  27. Doc, I was maxing out my retirement accounts until about 2010. With company match and bonuses, that was almost 20% per year going in there. But just as you said, I also have some concerns about the future state of these accounts. It doesn't change my investment strategies, and I have decided against taking the huge penalty and cashing it out. These days, I only put in enough to get the company match, which is free money.

    All the extra money not going to retirement accounts is now in cash/taxable accounts which I can access anytime. I'm trying to build these funds to the point that they are about to exceed what's in the 401k/IRAs. This way, unlike most Americans whose biggest asset is their house or retirement account and leaves them susceptible to more risk, I'm trying to spread it out. My goal is, my net worth is equally divided into 4 parts, almost like the Permanent Portfolio model:

    25% retirement accounts
    25% taxable accounts/cash
    25% real estate
    25% other hard assets, which will include some gold.

    That should provide a decent level of hedging/protection against every scenario. I'm not quite there yet, but trying hard to achieve that balance as soon as possible.

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    1. Thanks!
      It is hard to say what is "enough money", but I feel I have done a reasonable job funding retirement. So, I have decided not to add to it anymore and I have concerns about what I refer to as "electronic fiat". Sometimes I think age 59 1/2 cannot come fast enough.

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  28. YOU are the one that brought up timing Bud when you said you are in 50% cash now and are looking to re enter on pullbacks this year that will be "double digit" so.............that's a pretty significant trading/timing issue that you are NOT addressing.......YOU brought up the TWO pullbacks THIS YEAR....and that the market would end UP 7%. ....That is a fairly substantive trading statement fore someone not trading.

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  29. The exact strategy you stated was employed by several people I know in 2000 with "safe" technology stocks building out the internet infrastructure. like cisco systems, Intel, msft JDSU..., etc. These were considered the "blue chip" stocks by ALL of wallstreet. and they sucked the money up like good little parasites. AFter the first big Naz correction the sucker money came in and bought.........the smarter money held back and waited...then the bigger correction occurred and the Naz was down over 35%........then the smarter money jumped in.......that's when the high flyers really were taken out and slaughtered........many taken down 90% and portfolios still haven't come close to recovering if they were buy and hold suckers in some of the NAZ bluechippers....hehhehhehe........So you see Bud I want YOU to differentiate YOUR longer term "re enter strategy" for us at these "lofty levels" ie WHEN and at WHAT level are you committing your cash reserves. and what are your "boring" dividend paying stocks. WHY is that so difficult for you to understand.

    ReplyDelete
    Replies
    1. Kli - it is true many of the stocks you mention were down 70,80, 90% other "boring" stocks like drug companies (picked up some pharmacy mutual funds around 2003 that were down over 50%) and retailers (Walmart) took huge haircuts.... So even though tech took the largest hit (Naz over 5k to under 2k) most stocks took large hits.

      Delete
    2. Yes Inlet.....You know very well how many so called "safe" dividend paying stocks like Walmart have returned almost nothing over the past 17 years. On the other hand Budfox does have a point in the sense that LONG term there will be companies that perform relatively well compared to bonds and other assets. The argument is the time frame one has AND more importantly IS YOUR MONEY safe in this casino and I just don't mean equities. I am talking about all paper assets and that is where budfox has his greatest risk with his strategy. If a corrupt system begins to implode (which he scoffs at) then he will find out just how it feels to live in 1920s Germany or 1930s US or 2012 Cyprus or 2011 MF Global........Brazil.....Argentina ...Russia....Japan 1991-2014......and ON and ON.....enjoy the illusion.......this aint your grandma's economy ( or maybe it is....;-) )

      Delete
  30. Bastards with that random crash... Calls were nicely green now slightly red.

    ReplyDelete
    Replies
    1. However it did close the gap from below... very interesting.

      Delete
    2. Ehhh maybe not, i'm seeing different low points on various charts...

      Delete
    3. Very impressive 9000 contract sell (fat finger trade) BWAAAAAAAAA..... hope they didn't pop ya out Hubz

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    4. Nah I don't like stop losses, which I know people strongly disagree with but I watch my plays VERY closely. Especially with options, you have to.

      Delete
    5. Happy 2014 to all of you doom peeps....hey, doom spelled backwards is mood, we all go into doom mode, me-especially when I haven't had ice cream in a while....
      picked up some SI last week...Patience will pay off, kind of like what is happening with MSTX right now....

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    6. mornin' slacker.....hope u iz well and we are DOOOOOOOOMED..........hehehehheheehe......no ice cream for me......-12 degrees here today chill factor -29

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    7. No deep fried ice cream? Amazing how the big boys come back from vacation and fat finger gold...simply amazing I tell ya...
      ISR is really close to moving up from here...loss/reward scenario is great down here...

      I hope all of you had some good family holiday time....cheers and go 49ers...

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    8. hanging on to a nice size of MSTX. Thanks HCG.

      Delete
    9. patience will pay...someone is accumulating ISR...read their latest news in the summary...some very respected medical centers/hospitals have started using their radiation product......risk/reward good here with lots of places to get out above when it starts to roll depending on your style
      good luck in your trading 492...

      Delete
  31. Here's the January POMO schedule fwiw: http://www.newyorkfed.org/markets/tot_operation_schedule.html
    Of note, the biggest days are Jan. 15 and the 31st.

    ReplyDelete
  32. I've got $500 on Florida State tonight. My largest Vegas bet ever. Wish me luck.

    ReplyDelete
    Replies
    1. Hehehe I like it :) SEC is overrated.

      Delete
    2. Whaaat? But my 2 favs lost! My son works for UGA. Have to agree Fl. St. looks solid, but Auburn may have another miracle ending if one believes in such. They had 2 ag, Georgia and Alabama.

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  33. Uggghhh out on SLV calls. Need to move them out further, JAN is too dangerous. That fat finger screwed everything up.

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  34. http://news.goldseek.com/GoldSeek/1389021120.php

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  35. going for 300% in less than a month.......heheheheheheheh ......anyone hang on to this pig?

    http://stockcharts.com/h-sc/ui?s=PAL&p=120&yr=0&mn=4&dy=0&id=p91442735924&a=257509115&listNum=1

    ReplyDelete
  36. This hit piece screams BOTTOM:

    http://www.fool.com/investing/general/2014/01/06/attention-gold-investors-hold-on-tight-things-are.aspx#.UssLjfRDu_g

    ReplyDelete
  37. I do the best I can to find companies with a history of paying and increasing their dividends. Some are companies like AWR you have never heard of, which I added 2 years ago. As of now, it has been paying and increasing its dividend for 58 years in a row. Or WM, which is in a recession proof business because your trash needs to be collected no matter what. In 4 years, I have managed to come up with 12 companies, and so far, this has proven to be a good decision. Kli, your singular view is puzzling at times. High-flying stocks = garbage. Low-flying, dividend paying boring stocks = garbage. The entire markets = overpriced garbage. Cash: soon to be garbage once the dollar implodes. Miners and physical gold, now those are plays, apparently.

    Also, your comparisons above are nonsensical. It’s ludicrous that you compare the US to Cyprus, Argentina, or Weimar Germany. First of all, were any of those countries, including the US in the 30s, the #1 economic and military power in the world at the time, and had the world’s reserve currency? No, not even remotely close. People often like to talk about Weimar, but I wonder how much of the history they really know, other than reading about people taking wheel-barrows of cash to the store to buy a loaf of bread. The country was a wreck after WWI, it was severely hampered by the conditions imposed from the Treaty of Versailles. The Mark was still stable for a few years, but the London Ultimatum and the reparation payments is what caused the hyperinflation when they started to print. There is absolutely no comparison between the present day US and the ‘20s Weimar, or any of the others you cite.

    The US is an empire in decline. But even the Roman Empire lasted for another thousand years after its official collapse, as the Eastern half remained a formidable force until it was conquered by the Turks. Bottom line, by the time your doom scenarios actually come to fruition, if they ever do, none of us will be around to see it anyway. Worst case scenario I see is what I have repeated before, our decline may be similar to what happened to the British empire after WWII, and the sky did not fall.


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    Replies
    1. AWR I have been aware of and its in a great sector.... Problem with it is debt. In the current environment its very serviceable but if rates do rise in a growing economy then this Liquidity driven rally could put some real strain on its earnings.........just remember bud.....You're being snookered......and when they scam ends it will take all of these paper games down hard.....even the miners can go with it...but you obviously have a firm grasp on history so stick with your guns.

      Delete
  38. Hey budfox you could have done better than Daryl Hannah...think big like Eva Mendes or Jessica Alba...

    I believe this article is also part gold hit this year...you see the US govt. wants those tax haven squatters to pay the piper and none are bigger than the swiss haven...the swiss didn't want to play...so now your national bank has to pay, want to talk now...Thank you for your consideration, IRS, US treasury, Jamie and Lord B
    http://www.marketwatch.com/story/swiss-national-bank-warns-of-big-loss-over-gold-2014-01-06?

    ReplyDelete
  39. Some bad news to share:

    http://www.bbc.co.uk/news/business-25622236

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    Replies
    1. sure bud......firing on all cylinders just like 2007......nothing can go wrong with this economy........I wonder why were printing 700 billion to buy our debt and hold interest rates down in such a great economy.........all good

      Delete
    2. I'll tell you a little story bud about the market we're in......About 6 weeks ago I had the opportunity to pick the brain of a Goldman alumnus that owns a billion dollar hedge fund that is still in GSs orbit if you understand what that means......we had spent a couple of days talking about shop and several other subjects and during that time he confessed he really had NO idea what to invest in right now and thought the market was "insane"......He held virtually NO equities other than some botique stocks YOU have never heard of........this was unheard of for him to be out of equities and his holdings were some corporate issues and hard assets in a multitude of countries.....mostly south of the equator all around the world. He is in the club and HE believes we are out of control. He was deeply disturbed. I made a wager with him that we would have much larger QE announced by April......I wanted to see his reaction mostly......but he wouldn't give me any odds......You're welcome to believe your stew.........and I'm glad you've become an astute stock picker. gl

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    3. Kli, I sure do not why someone like Bud attacks your view. My understanding of you outlook is the real trouble was likely to hit late in 2014 and/or 2015. How can he claim to know your outlook is wrong? I guess it must be what he is smoking. He buys low takes a few puffs and sells "High". 2 funny

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    4. Unfortunately as you know very well Inlet......bud represents a large segment of the retail investors out there. I made it clear over a year and half ago the miner trade was broken. I also stated I was going to maintain a full position. My reasons for that decision remain intact. Bud apparently believes that value lies in his strategy based upon the last two years and that is certainly his right to believe based on his performance.....but you and I know how "past performance" goes in this game.........

      Delete
  40. As far as WM is concerned if you had bought that stock 15 years ago you would be back to even ......as far as the company goes you may want to look a little closer at its history and management. If you think that sector holds up in market crash you may want to look at how it did in 2000

    http://stockcharts.com/h-sc/ui

    ReplyDelete
  41. Not 2 years, 13 years, with plenty of lessons learned in between. You are welcome to confuse me with what's often referred to as mom & pop sucker retail investors who always lose, but you would be incorrect. And the reason I keep bringing up some of your predictions is because the goal post seems to be moving each year. We were long supposed to doomed by now, but apparently as per your friend Inlet, now it's early 2015.

    ReplyDelete
    Replies
    1. oh trust me bud ......no one could possibly confuse you as a sucker retail investor.......did you check your history on WM?

      Delete
    2. WM is where old baastids like Inlet and I have it on you bud........WM was THE long term buy and hold in the 80s.......THE long term buy and hold.........there was a "problem".........its still there

      Delete
    3. Since you haven't answered I shall help those that believe your BS as a "long term investor" here is your STALWART stock and just in case you try to BS this I have one more even bigger surprise for you on this stock.....but then you surely know right budfox????

      http://www.sec.gov/news/headlines/wastemgmt6.htm

      http://www.accounting-degree.org/scandals/

      http://kliguy38depression2news.blogspot.com/2014/01/bernanke-bubble-trouble.html#comment-form

      Delete
    4. Any pro over 40 knows why you don't put your mom in WM.......Ya gotta know it Bud........after all , you're a pro..........Inlet and I are retail and I bet Inlet knows WHY no one would be a long term investor in WM.........c'mon bud......as an old retail investor I've made this whopper of a mistake too...........hell ....I even OWNED WM before in the 90s because it was a "safe" stock in a "downturn" just like you budfox.......so its OK....here's a hint bud........its a solid family business and ALWAYS has been.

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    5. family owned..... hehehehehe ya think! If you understood that business in the 80's, you would understand now wouldn't you.... but I guess that's only us old folks!!!

      Delete
  42. Kli, how about a refresher, just so there's no confusion anymore? When is the end of the Grand Supercycle? When do we expect to see the Kondratieff Winter? I think I know your answer, we're already there, and we've been collapsing for the last 5 years, but please clarify just in case.

    ReplyDelete
    Replies
    1. then you don't need my help......:-)

      Delete
  43. Bud, the Grand Super Cycle is 120 years long - 1774, 1894, 2014 (??). It consists of 2 K waves 60 years each (1894,1954, 2014). Each K Wave consists of 2 Super cycles of 30 years (Kress says there are also 40 year and 12 year sub cycles). Seems you are the only one confused.

    ReplyDelete
  44. How the cycles align 2014:
    http://highrevsopenhouse.blogspot.com/search?updated-max=2013-11-23T11:07:00-05:00&max-results=1&start=7&by-date=false

    ReplyDelete
  45. You have nothing here Kli, quit living in the past and go back to pumping your POS miners and I'll stick to WM and others. In fact I'll be adding more to my WM position later this month as part of a rebalancing on my dividend portfolio.

    I really do think from time to time about the lost opportunity cost and how close to bankrupt I would be if I'd taken your advice since 2009, scary thought for sure.

    ReplyDelete
    Replies
    1. so you're ignoring the "past" hehehhehehehe ......ok bud you truly are a pumper........Do you know WHO runs your solid "waste" company. c'mon bud if you're gonna pump shit then you need to know.......answer the question??????? WHO is behind WM

      Delete
    2. BTW bud this is not a "high tech" "new age" company......its been around for a long time and its owners will continue to screw the shareholders over the long term as they have in the past.........WHO really runs it bud?????

      Delete
  46. Load up on it bud......it'll be your retirement........its a "peach"

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  47. Hey bud.....Carlos says Hi..........ehheheheheheehehehh

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  48. Yes Kli, in fact, you caught me, I've been lying this whole time. My entire life savings is invested in WM. Last year I even took a second mortgage to buy more WM. I wonder if I can ever show my face around here now that I've been caught. "Bud the WM Pumper" has been busted.

    But on second thought, I might be OK. You're actually a contrarian indicator after all. Anything you pump crashes and burns, anything you bash goes up. The evidence is right in the archives of this blog. It should be a fun ride as WM goes to da moon after your little hit piece.

    ReplyDelete
  49. Bud......YOU pumped WM.....NOT me........YOU said it was a core holding of yours for the long term........ You posted two stock one is run by the Mafia and everyone on the street or who has been around for longer than a few years knows........Bud People that read this blog DO know how to google Waste Management is run by the Mafia...........try looking it up bud next time before you pump it.......and your other stock has over 300 million in debt and very little cash on hand .......they will have earnings impact as they roll over this debt.......AWR...but it IS a good sector....maybe I had better review it a little better after your last stinker

    ReplyDelete
  50. Whoops on AWR .......Zachs reports Long-term debt as of Sep 30, 2013 was $1,630.6 million compared with $1,669.4 million at the end of 2012.
    Not sure bud......lookin' worse for this one too. They also missed on "Revenue" on last earnings.......of course that shouldn't concern a "bottoms up" guy like you.

    ReplyDelete
  51. WM was infested with the mob in the 80s and 90s.....no big secret bud unless your were getting your info from Cramer.......hehehhehee BTW BUD nothin's changed

    http://www.timesnewsweekly.com/news/2013-01-24/Crime_(and)_Cases/Fed_Dump_Mafia_Controlled_Waste_Management_Scam.html

    ReplyDelete
  52. Ya got anymore jewels for us bud............this is fun........I know mine are pigs........but heck they're at least at 90% discounts.....Yours are on top of the rocket trip

    ReplyDelete
  53. You have a special talent when it comes to hyperbole. AWR, solid company, in a safe industry of water provisioning and related services, 84% gross margins for 2012, and should continue to increase its dividend payout for years to come. It's been a great investment thus far.

    I'll tell you what. When my portfolio of dividend stocks is down 90% like your basket of miner stocks, then we'll talk. Until then, nothing you say can be taken seriously.

    ReplyDelete
  54. Enjoy your 90% discount, soon it'll be 95, maybe even 100%. And then you can tell us how your miner x went from .40 to .80 for a 100% gain! I mean you are spending your time at the absolute bottom of the barrel, with next to no hope of getting out of there. And I'm sure your miners are run by the cleanest, most honorable men known to mankind, no criminals here.

    ReplyDelete
    Replies
    1. No argument on who may be running them bud.........its paper and it trades in the casino so crooks abound.......

      Delete
    2. bTW congrats Jay.........Florida State beat my over rated SEC

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  55. Alert for anyone who didn't see the ZeroHedge story that claims the mini crash tails on commods are signals/markets for insiders to know where the next push down will be, today it is 1215.04. Then of course the naked shorts come in and other shorts will pile in and drop the price even more and faster. Let's see if they get it to 1215 by Wed. for the FOMC minutes.

    ReplyDelete
    Replies
    1. C'mon sista..........that's cheatin' and EVERYONE knows gold's a barbarous relic........heheheheheheheheheheeh

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    2. Those geniuses gotta make their money somehow....:(. Looks like it's playing out perfectly today as planned. Oh how I hate being so cynical.

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  56. oops..signals/markers (not markets)..

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  57. John Williams vid above is well worth watching......of course its "doom and gloom" because as anyone knows the real truth just isn't that rosy.......

    ReplyDelete
  58. You guys read about the idiot that had a $50,000 winning Auburn ticket and didn't hedge it with Florida State? Greedy pig :)

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  59. http://www.zerohedge.com/contributed/2014-01-07/germanys-gold-housed-new-york-paris-and-london-all-gone

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  60. Phew, made back what I lost on SLV with TWTR puts. Realized to avoid the IV crush you have to buy way ITM puts. Worked very nicely.

    ReplyDelete
    Replies
    1. Bravo! casino boy..........hehehhehehe

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    2. Thank ya ;) Also huge volume on AG $10 calls today... hmmmm....

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  61. http://news.goldseek.com/GoldSeek/1389110400.php

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  62. Miners seem strong. Many are sitting and consolidating above June lows.

    ReplyDelete