<< <i>If your name is Goldman/Sachs you just sell off more contracts that you can't cover and the price falls bringing your massive short position less underwater. It costs less to sell more and manipulate the price down than it would to close out some short positions, In fact if you close out short positions it puts your other short position even more underwater.
It doesn't matter how much short you are or that you could never deliver on the positions, what will happen is that eventually you get one of the many well placed former GS executives, now in official position to either provide you with some well timed info or to instigate an event that shakes out the longs and allows you to cover. >>
Oh yeah, just gotta love that free market capitalism in full swing. Now where's that sarcasm emoticon?
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Don't look now but the USDollar index just sank into cyclical low record territory at 74.6. I believe this is the first time it has fallen below 75 and stayed there. With basically an overseas only day on gold, it has been pushed up to just touching $410. Sinclair followed with a Thanksgiving day "gift" warning his readers that things are falling apart even more quickly in the dollar than he imagined. He continues with strong recommendations to limit the number of people between you and your assets (depositories, brokers, banks, etc). This is not a great time to be keeping any excess liquidity in bank accounts, money markets, etc of the major banks. Expect the writedowns to pick up the pace and spread to smaller participants. There will be few entities who have no derivatives risk.
The above graph shows the cyclic nature of stocks and gold from 1970 to date. It's quite clear that stay in either for too long will kill one's returns. Stocks basically stunk up the joint from 1970 to 1980 and then from 2000 to 2007. Those are the same periods that gold did well. And while gold stunk from 1980-2000, stocks soared. Oddly enough, those charts are from Kitco.
Options expire today so its time for the manipulators to go to work.
There were huge call options at 825 and 800 for gold. Guess it's due to the real low inflation rate, That is if you dont count food and energy and adjust downward for the fall in housing prices.
Why is it I just feel a little poorer everytime time I go to the store.
<< <i>Options expire today so its time for the manipulators to go to work. >>
They're already at work, just look at the price drops in both gold and silver today alone.
You're not the only one who feels a little poorer every time you go to the store.
I couldn't believe the total for 4 plastic bags of groceries the day before Thanksgiving. I actually had to look twice, couldn't believe it was over 3 figures. Then I went and fueled the car, 21 gallons for a mere $80+.
Sure glad the Government assures us there's no real inflation going on.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
In the meantime, the stock markets are way up today. That means it must be a great time to buy, right? NOT
"Men who had never shown any ability to make or increase fortunes for themselves abounded in brilliant plans for creating and increasing wealth for the country at large." Fiat Money Inflation in France, Andrew Dickson White (1912)
Maybe one last fool's rally to get the last of the big boys out, then another good tanking down under 12,800. But then again, old contrarian Cliff Droke sees the Dow headed for record territory as the contrarian play of the year. And dang if he isn't right most of the time on his calls.
Do not forget the 'Santa Claus Rally'..... we should certainly have one of those this year... just depends on how large...may be good after the Feds cut interest rates on the 11th. Cheers, RickO
<< <i>The question I have about this is that someone who is facing a margin call cannot take on additional positions. Shorting requires a margin account and if someone needs to meet a margin call they cannot borrow/short anymore. They need to add capital to their account, they cannot borrow more. >>
If your name is Goldman/Sachs you just sell off more contracts that you can't cover and the price falls bringing your massive short position less underwater. It costs less to sell more and manipulate the price down than it would to close out some short positions, In fact if you close out short positions it puts your other short position even more underwater.
It doesn't matter how much short you are or that you could never deliver on the positions, what will happen is that eventually you get one of the many well placed former GS executives, now in official position to either provide you with some well timed info or to instigate an event that shakes out the longs and allows you to cover. >>
HA!! Excellent call Coynclecter . Nov 29th Jim O'Neill a Goldman Sachs chief economist in London suggests selling dollar denominated Gold. and sees a 15-20% drop next year.
I'll take the pro-gold side of Jim O'Neill's bet. While we might just see a 20% drop in gold next year, it's not gonna be from $800, but more likely from $1000-$1200. And in that case, he would have predicted correctly (lol). But give old GS a good pat on the back for trying to set up the sheeple to dump gold while the Wall Street Banker's liquidity index is teetering on default.
<< <i>HA!! Excellent call Coynclecter . Nov 29th Jim O'Neill a Goldman Sachs chief economist in London suggests selling dollar denominated Gold. and sees a 15-20% drop next year. >>
It is totally amazing to me how anyone can take advice from a major player in any market. They will never tell you what they think will happen, only what they want YOU to do.
Like taking advice on whether to hold or fold from the guy who just bet.
If Goldman is saying sell all your gold they must be buying.
For those in the stock market that had no idea they were swimming with the sharks here is an article that will give them some idea.
Now it appears that not only are the markets casinos, but they are rigged worse than Vegas.
NEW YORK TIMES By BEN STEIN Published: December 2, 2007
FOR decades now, as a writer, economist and scold, I have been receiving letters from thoughtful readers. Many of them have warned me about the dangers of a secret government running the world, organized by the Trilateral Commission, or the Ford Foundation, or the Big Oil companies or, of course, world Jewry.
I always scoff at these letters. The world is far too complex a place to be run by any one group. But the closest I have recently seen to such a world-running body would have to be a certain large investment bank, whose alums are routinely Treasury secretaries, high advisers to presidents, and occasionally a governor or United States senator.
Goldman Sachs is a huge name in terms of moneymaking and prestige. I totally understand the respect it receives for its financial dexterity. The firm is a superstar in that regard, and I, a small stockholder, am grateful. But it has never been clear to me exactly why its people are considered rocket scientists in any other area than making money.
Goldman Sachs was injecting dangerous financial products into the world’s commercial bloodstream for years. Goldman Sachs was one of the top 10 sellers of C.M.O.’s for the last two and a half years.
Goldman was peddling C.M.O.’s, it was also shorting the junk on a titanic scale through index sales — showing, at least to me, how horrible a product it believed it was selling.
Doesn’t this bear some slight resemblance to Merrill selling tech stocks during the bubble while its analyst Henry Blodget was reportedly telling his friends what garbage they were?
Maybe it’s time for an investigation of just what Wall Street and Goldman did to make money as they pumped this mortgage mess into the economic system, and sometimes were seemingly on both sides of the deal.
OK...so what do we know about our current situation. Any prognostications out there? It does not appear that there is a 1:1 correlation of gold to oil. Silver is not tracking with gold but lagging. There is no shortage of middle eastern types that will produce and sell the light crude to us as they still like dollars just fine. Credit markets have tightened up considerably but having just bought a new house, lenders are ready to lend but only to those that can do 20% down and have reasonably good credit. The cake walk days are waining.
The credit card item infront of congress right now is probably going to be kind of like the bankruptcy hearings last year...the consumer is just going to have to continue taking a screwing from those that they get credit from. Why shouldn't they be screwed, they have no representation. No one has sued the credit card companies for complicity or collusion and the credit card borrowers are just swinging in the wind, eunicated as it were. For example, all of the credit companies report any deliquency to each other, your insurance (auto) is tied to your credit rating, your credit score and consequently your ability to obtain credit is tied to all of these things. Your utility deposits amount, your phone deposit amount is based on your credit rating, your home loan rates are based on your credit. The banks have burrowed so far into the lives of the average guy that the average guy is working for them and everybody knows everything about those poor blokes, even their medical history...it's all good if you own a few million middle class consumers, you just beat the money out of them. The banks/financial institutions and the federal government are way too cozy with each other for the consumer to come out of this whole. The particularly aggregious part of this is now they spam your email account with medical products if you have been to a doctor using your medical insurance, spam you for consumer thingies you might like, car advertisements (since they know yours if 5 years old), a relentless pounding to get more business on one side of the street while the credit lenders attack you from the other side of the street...somebody is going to get hurt out there, it's the baseball term pickle (where is guy is on third and is trapped between third and home). So the middle class consumers are in a pickle.
If you have a credit account with one of the major institutions, they can do with you what they want. They can charge you 29% on your credit accounts or if you choose not to accept their conditions, you can close that account and pay it off and that means you have defaulted. Not a pretty landscape for the middle class and the slippage in their ability to participate in the American dream is becoming more and more compromised as each day passes. The bad thing is there is no relief in sight, in fact, since the major financial institutions have lost a bundle on the middle class home buying/equity atm spree last year, the banks will have to recover the money somewhere and it's not a stretch to have a pretty good idea of where it will come from...the prey of choice aka the middle class consumer. The only problem with this strategy is that at some point they will depleat their food source as the middle class becomes more and more financially compromised.
But what does this have to do with the investor class, be they small or big? Well, that's what I'm wondering. Are any of the candidates going to touch the third rail? third rail Will this spook the investors into going to Dubai?
Is anyone going to become a consumer advocate or should they all swing because the are no longer satisfied to live like the Joneses, they want to BE the Joneses. There is going to be a price to pay, just how do you prognosticators or thinker bees see this playing out? Consumer credit
I believe the situation is that for the first time in human history the structural economy is far more solid than is needed for the population. To put this into a more accurate form. Humans' biological niche is exploding due to the changes introduced into the enviroment and the greater efficiency and knowledge made possible through computers.
This huge increase in wealth is being funneled into a few hands which operate the financial and political organizations. Much of it evaporates in smoke since sometimes this is the only way to allow concentration of the wealth.
It's very true that our financial system is a house of cards and that those who are tinkering with it are not aware of all the risks. If they knock it down, the in- frastructure and system of laws are probably sufficiently robust that it could be stood back up.
These are interesting times. What has always been true is that if you stay a step ahead of everyone else, if you don't follow the herd, if you do your own thinking, and you plan ahead then you'll probably be OK.
2. Reinstate the usury laws to limit interest rates on loans. Tie it to a maximum % above the prime rate
3.Begin the process of regulating and untangling the 480 trillion dollars in exotic financial instrumen
4. Tighten regulations on the types of investments that banks are allowed to invest in. Simplify and clarify the banks balance statements to show liabilities and assets.
5.In the mutual Fund Industry, increase oversight on how much and how many charges are imposed on fund holders by fund management.
These are only a few of the changes necessary to protect the American Citizen.
Perhaps the wise ol' bear has had a good lickin' at the honey jar since he didn't double space every line in his response. Maybe the wise ol' bear is happy and content, lost that edginess. A honey filled bear is a happy bear. Good points, Bear!
2. Reinstate the usury laws to limit interest rates on loans. Tie it to a maximum % above the prime rate
3.Begin the process of regulating and untangling the 480 trillion dollars in exotic financial instrumen
4. Tighten regulations on the types of investments that banks are allowed to invest in. Simplify and clarify the banks balance statements to show liabilities and assets.
5.In the mutual Fund Industry, increase oversight on how much and how many charges are imposed on fund holders by fund management.
These are only a few of the changes necessary to protect the American Citizen. >>
While they're at it, they might as well make certain my diapers stay unsoiled at birth and likewise before they place me in my grave. This "cradle to grave" mentality plays a very large part in WHY the American citizen needs protection to begin with. If the American Citizen was used to standing on his own two feet and making and abiding by his decisions; be they good or bad, then he wouldn't need coddled at all. This "wussification" of America would make our forefathers very ill.
The true inflation rate and devaluation of the dollar seems to be about 10% a year. Thus to keep ones worth at an even level, you would have to obtain close to 13% return. For many people, the best they can do is a 5% CD which would require a savings rate of 8% to protect the purchasing power of ones liquid assets.
People can not continue to borrow and spend. The new mantra must become (Be prudent and save). Much of what we call investments, are really a part of a rigged game that is controlled by the big banks and investment companies. In this environment, one can not believe most of what one hears nor even much of what one sees. Much is illusion, a facade and a crap shoot for the majority of Americans.
<< <i>"Is anyone going to become a consumer advocate?"
A true consumer advocate would offer advice such as "consume less, borrow less" >>
Ahhh, but where's the fun in that?
This isn't intended as a defense of the credit card companies, but the truth is- nobody is forced against their will to apply for or use credit cards. And my impression of the American Dream has never been buying lots of shiny things "As Seen On TV" with borrowed money that one doesn't know how he will repay.
And...another thing. Gold and oil are both in high demand as commodities. Oil is a strategic commodity in that it is necessary for distribution of goods and services, necessary for manufacturing, necessary for personal transportation, and necessary for military defense. If gold gets to a stage where it becomes a necessary commodity for preservation of wealth, be it public or private, against fiat currencies then it would become a strategic commodity. If gold becomes a strategic commodity then everybody had better have some. If everybody needs to have some, some is good but more is better.
Bear's is likely correct about needing a 5% CD to go with an 8% savings rate to stave off the dollar devaluation and that's just to stay even, we haven't even started discussing strategies for making some kind of advancement of one's position. The fiat currency is beginning to have an effect because it takes more USD to buy less goods. Consequently, preservation of wealth and buying power is indeed worthy of considerable personal strategic planning, particularly while you are using the USD, at least for now. Otherwise, individual wealth will be eroded and that's not good for anybody. For example, next year when all these foreclosed homes are absent from the tax roles, cities and everybody upstream from cities will go lacking from tax revenue. Lose tax revenue and you have to close facilities and lay off staff. It becomes a vicious cycle.
In an international market place, it seems reasonable to hold international commodities, and maybe even some international equities. Seems reasonable to assume that something compact and easy to store would be more convenient than storing 55 gal. drums of light crude in your back yard. Looks like diamonds or gold or some kind of equity shares are easy to store and have international liquidity so reasonable folk are going to deduce a similar conclusion. And...there you have it.
"What will be the impact, if gold miners in South Africa strike for 3 months?
Does this mean gold is poised to rocket upward short term?"
I think it means that if you can get in for under 800 or even better yet, closer to 760 then it may be a good opportunity. The key is to slowly accumulate so you never have to stretch. For the smaller guys, 1/10 or 1/4 every couple of weeks and pretty soon you've got a few oz...and then after a while you have some reserves that you didn't have to hock the house for. For bigger guys, bigger plays. So, that 8% you are supposed to be saving every pay check could easily be 2% gold and 6% cash or a mixture of cash and equities. Any advancement beyond that and you are building wealth.
<< <i>The true inflation rate and devaluation of the dollar seems to be about 10% a year. Thus to keep ones worth at an even level, you would have to obtain close to 13% return. For many people, the best they can do is a 5% CD which would require a savings rate of 8% to protect the purchasing power of ones liquid assets.
People can not continue to borrow and spend. The new mantra must become (Be prudent and save). Much of what we call investments, are really a part of a rigged game that is controlled by the big banks and investment companies. In this environment, one can not believe most of what one hears nor even much of what one sees. Much is illusion, a facade and a crap shoot for the majority of Americans. >>
Bear, I hear you loud and clear and truly feel the pain.
The pain is that I feel our American Empire is done for...they all come and go. Apathy sets in, greed concours honor and noone knows their neighbor. Dog eat Dog. No leadership on both sides of the aisle. Corporations have no national allegiance.
How can Americans and politicians pay back their debt and restore this once great economy when the only advice we get is go spend money at the mall. The numbers that are spewed about low inflation, high stock prices, high home ownership and great standard of living is a sham, a house of cards.
No inflation...have these economists ever shopped for food themselves? Do they pay for their own gas or heating oil? Oh, that's right...inflation is measured "excluding volatile food and energy."
Bear, why is it that when you state your opinions on the economy, (ie...a 10% inflation rate) they raise little to no opposition. Yet each time I state something like that, even in passing, every anti-gold bug and pro-growth economist comes flying out of the woodwork to parade the latest BLS stats to purportly "refute" my claims?
Do the Bear and Mogambo Guru have something in common? Both appear to be untouchable.
Bear, why is it that when you state your opinions on the economy, (ie...a 10% inflation rate) they raise little to no opposition. Yet each time I state something like that, even in passing, every anti-gold bug and pro-growth economist comes flying out of the woodwork to parade the latest BLS stats to purportly "refute" my claims?
Do the Bear and Mogambo Guru have something in common? Both appear to be untouchable.
Maybe it's because we lionize the Bear? And roadrunner, don't worry - you're opinion is valued greatly!
Q: Are You Printing Money? Bernanke: Not Literally
If Geo. I were to declare a 'state of emergency' which he can and make an XO order along the lines of.....
In 12 months-50% of the cars manufactured new or newly imported into this country are to be fitted for flex fuel and thereafter an additional 10% yearly up to 90% of all cars in 5 years.....
The price of oil would drop 50% in 12 months......gold would be about $500-600 or less and everybody who thought gold was on the way to $1500 would be a lot poorer.
And the U.S. economy would be like a Saturn V on the way to lunar orbit.
"How can Americans and politicians pay back their debt and restore this once great economy when the only advice we get is go spend money at the mall. The numbers that are spewed about low inflation, high stock prices, high home ownership and great standard of living is a sham, a house of cards."
Ren, you da man. Right over their heads
Quis custodiet ipsos custodes?
Apropos of the coin posse/aka caca: "The longer he spoke of his honor, the tighter I held to my purse."
If Geo. I were to declare a 'state of emergency' which he can and make an XO order along the lines of.....
In 12 months-50% of the cars manufactured new or newly imported into this country are to be fitted for flex fuel and thereafter an additional 10% yearly up to 90% of all cars in 5 years.....
The price of oil would drop 50% in 12 months......gold would be about $500-600 or less and everybody who thought gold was on the way to $1500 would be a lot poorer.
And the U.S. economy would be like a Saturn V on the way to lunar orbit. >>
Government can't decree laws that supercede natural laws. Alcohol probably requires more fuel to produce that it releases. There is a fin- ite amount of alcohol we're capable of producing and the more we make the more we need.
Food prices would go up dozens fold if we tried such a stunt and the fuel crisis would get worse. Of course we could just keep burning gas- oline in flex fuel vehicles.
Alternatively, no vehicles with more than 6 cylinders can be driven on US highways with out a special permit (tax the bejezus out of 'em). That would stop this silliness and just for drill you could limit the cubic inches for the engine with out a special permit (tax the bejezus out of 'em).
The import idea is good...let the foreigners figure it out, especially when we are buying from them.
If Geo. I were to declare a 'state of emergency' which he can and make an XO order along the lines of.....
In 12 months-50% of the cars manufactured new or newly imported into this country are to be fitted for flex fuel and thereafter an additional 10% yearly up to 90% of all cars in 5 years.....
The price of oil would drop 50% in 12 months......gold would be about $500-600 or less and everybody who thought gold was on the way to $1500 would be a lot poorer.
And the U.S. economy would be like a Saturn V on the way to lunar orbit. >>
The chances of that happening are less than zero. Remember that there is only one set of world leaders that Bush holds hands with when on a state visit - the ibn Saud family.
In 1989 a good friend came to me and said he had bought the technology, from a guy in Atlanta, to convert all vehicles to use NATUAL GAS.
He wanted me to buy a public shell corporation for him, take him public, raise ten million, and help set up the first fueling station in Austin Texas. He also wanted to build the first prototype conversation garage to convert vehicles to run on nat gas.
This mans name was Virgil Robbins, and we did all that in the first three years.
We put the first fueling station in Austin, and the then land commissioner; Gray Marrow was there to open the station.
This technology was very simple. A few gadgets added to the carburetor, a compressed natural gas tank put in the trunk, or the bed of a truck, and a switch on the dash to switch back and forth from Nat. Gas to gasoline in case you could not find a station.
We took a two-week trip to Vancouver Canada to visit their set-ups. They had over 100 natural gas stations in that city.
NO pollution, and the BTU comparison, with our equipment, was about 100 cubic feet of Nat. Gas per one gallon of gasoline. At today’s prices that would get you to 75 cents per gallon.
I am telling this story as an example of how absolutely NOTHING is going to get done to wean us off of Arab oil. All this is just another game. There are many alternatives already in place. We could be energy self sufficient in less than five years if we just spent the money we have spent on the Iraq war, but this is just not going to happen!
This government of ours now operates in crises management mode. It does no planning for the future, and just like the current housing problem its solution is to just print more money.
The ONLY thing an individual can do at this point is protect his or her own family.
In 1989 a good friend came to me and said he had bought the technology, from a guy in Atlanta, to convert all vehicles to use NATUAL GAS.
He wanted me to buy a public shell corporation for him, take him public, raise ten million, and help set up the first fueling station in Austin Texas. He also wanted to build the first prototype conversation garage to convert vehicles to run on nat gas.
This mans name was Virgil Robbins, and we did all that in the first three years.
We put the first fueling station in Austin, and the then land commissioner; Gray Marrow was there to open the station.
This technology was very simple. A few gadgets added to the carburetor, a compressed natural gas tank put in the trunk, or the bed of a truck, and a switch on the dash to switch back and forth from Nat. Gas to gasoline in case you could not find a station.
We took a two-week trip to Vancouver Canada to visit their set-ups. They had over 100 natural gas stations in that city.
NO pollution, and the BTU comparison, with our equipment, was about 100 cubic feet of Nat. Gas per one gallon of gasoline. At today’s prices that would get you to 75 cents per gallon. >>
There exists a power plant today that can run cleanly, efficiently, and simply on virtually any flammable gas or liquid. In widespread use, this engine would open the supply markets. Rather than gas stations, we would have filling stations where one week you may fill-up on propane, the next on methane, and the following week on bio-diesel. Ultimately, this fuel open market would be a transition to hydrogen and fuel cells.
The technology exists. We need governmental guidance to get there.
<< <i>Ultimately, this fuel open market would be a transition to hydrogen and fuel cells.
The technology exists. We need governmental guidance to get there. >>
Fuel cell technology is nowhere near soup yet. Hydrogen is costly to produce, the savings and mileage not nearly what it's backers are claiming and you'd need a fuel tank the size of a covered full sized pickup truck just to match existing vehicles currently on the road.
Ethanol is a political choice when you consider that using corn requires 70% of the energy to produce as it returns. The only thing worse they could have chosen would have been wheat, which requires 80%. OTOH, sugar cane only requires 10%. That would actually be the proper choice, but where's the profit for the friends of our politicians there?
There is plenty of oil, the earth continues to produce it on a regular basis. Nothing even remotely produces the power of gasoline per volume. Our PROBLEM IS Government guidance/intervention. We aren't able to drill and we aren't able to build refineries, that's thanks to our Government. Even the Chinese are now drilling off the coast of Florida (between Florida and Cuba).
The only country in the world which produces clean energy, the vast majority of it's energy, is France of all places. How? American technology and safe, clean nuclear power plants. We know how to do it, we just aren't allowed to on our own soil, again, thanks to our forward thinking politicians bending to the will of a loud, ignorant minority.
PS- The number of cylinders in an internal combustion engine has NOTHING to do with it's efficiency. 4-6-8-10-12 doesn't matter, it's the technology behind the motor, not the size nor number of cylinders. There's nothing wrong with building more efficient motors, and we are doing it, but throwing out the baby with the bath water isn't the answer. Free market capitalism would be the best place to start.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
For about $5 billion we can build coal gasification plants. General Electric already has the technology. It will take about 300 plants to supply the US with all the oil we need.
Think of how many jobs this would create? How much the economy would expand? How much extra money could be devoted to other projects? Problem is no one has the balls to make it happen.
Comments
<< <i>If your name is Goldman/Sachs you just sell off more contracts that you can't cover and the price falls bringing your massive short position less underwater. It costs less to sell more and manipulate the price down than it would to close out some short positions, In fact if you close out short positions it puts your other short position even more underwater.
It doesn't matter how much short you are or that you could never deliver on the positions, what will happen is that eventually you get one of the many well placed former GS executives, now in official position to either provide you with some well timed info or to instigate an event that shakes out the longs and allows you to cover. >>
Oh yeah, just gotta love that free market capitalism in full swing. Now where's that sarcasm emoticon?
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
There will be few entities who have no derivatives risk.
Gold vs Stock's performance 1970-2007
The above graph shows the cyclic nature of stocks and gold from 1970 to date. It's quite clear that stay in either for too long will kill one's returns. Stocks basically stunk up the joint from 1970 to 1980 and then from 2000 to 2007. Those are the same periods that gold did well. And while gold stunk from 1980-2000, stocks soared.
Oddly enough, those charts are from Kitco.
roadrunner
There were huge call options at 825 and 800 for gold. Guess it's due to the real low inflation rate, That is if you dont count food and energy and adjust downward for the fall in housing prices.
Why is it I just feel a little poorer everytime time I go to the store.
<< <i>Options expire today so its time for the manipulators to go to work. >>
They're already at work, just look at the price drops in both gold and silver today alone.
You're not the only one who feels a little poorer every time you go to the store.
I couldn't believe the total for 4 plastic bags of groceries the day before Thanksgiving. I actually had to look twice, couldn't believe it was over 3 figures. Then I went and fueled the car, 21 gallons for a mere $80+.
Sure glad the Government assures us there's no real inflation going on.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
roadrunner
<< <i>
<< <i>The question I have about this is that someone who is facing a margin call cannot take on additional positions. Shorting requires a margin account and if someone needs to meet a margin call they cannot borrow/short anymore. They need to add capital to their account, they cannot borrow more. >>
If your name is Goldman/Sachs you just sell off more contracts that you can't cover and the price falls bringing your massive short position less underwater. It costs less to sell more and manipulate the price down than it would to close out some short positions, In fact if you close out short positions it puts your other short position even more underwater.
It doesn't matter how much short you are or that you could never deliver on the positions, what will happen is that eventually you get one of the many well placed former GS executives, now in official position to either provide you with some well timed info or to instigate an event that shakes out the longs and allows you to cover. >>
HA!! Excellent call Coynclecter .
Nov 29th Jim O'Neill a Goldman Sachs chief economist in London suggests selling dollar denominated Gold. and sees a 15-20% drop next year.
roadrunner
<< <i>HA!! Excellent call Coynclecter .
Nov 29th Jim O'Neill a Goldman Sachs chief economist in London suggests selling dollar denominated Gold. and sees a 15-20% drop next year. >>
It is totally amazing to me how anyone can take advice from a major player in any market. They will never tell you what they think will happen, only what they want YOU to do.
Like taking advice on whether to hold or fold from the guy who just bet.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
For those in the stock market that had no idea they were swimming with the sharks here is an article that will give them some idea.
Now it appears that not only are the markets casinos, but they are rigged worse than Vegas.
NEW YORK TIMES
By BEN STEIN
Published: December 2, 2007
FOR decades now, as a writer, economist and scold, I have been receiving letters from thoughtful readers. Many of them have warned me about the dangers of a secret government running the world, organized by the Trilateral Commission, or the Ford Foundation, or the Big Oil companies or, of course, world Jewry.
I always scoff at these letters. The world is far too complex a place to be run by any one group. But the closest I have recently seen to such a world-running body would have to be a certain large investment bank, whose alums are routinely Treasury secretaries, high advisers to presidents, and occasionally a governor or United States senator.
Goldman Sachs is a huge name in terms of moneymaking and prestige. I totally understand the respect it receives for its financial dexterity. The firm is a superstar in that regard, and I, a small stockholder, am grateful. But it has never been clear to me exactly why its people are considered rocket scientists in any other area than making money.
Goldman Sachs was injecting dangerous financial products into the world’s commercial bloodstream for years. Goldman Sachs was one of the top 10 sellers of C.M.O.’s for the last two and a half years.
Goldman was peddling C.M.O.’s, it was also shorting the junk on a titanic scale through index sales — showing, at least to me, how horrible a product it believed it was selling.
Doesn’t this bear some slight resemblance to Merrill selling tech stocks during the bubble while its analyst Henry Blodget was reportedly telling his friends what garbage they were?
Maybe it’s time for an investigation of just what Wall Street and Goldman did to make money as they pumped this mortgage mess into the economic system, and sometimes were seemingly on both sides of the deal.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
The credit card item infront of congress right now is probably going to be kind of like the bankruptcy hearings last year...the consumer is just going to have to continue taking a screwing from those that they get credit from. Why shouldn't they be screwed, they have no representation. No one has sued the credit card companies for complicity or collusion and the credit card borrowers are just swinging in the wind, eunicated as it were. For example, all of the credit companies report any deliquency to each other, your insurance (auto) is tied to your credit rating, your credit score and consequently your ability to obtain credit is tied to all of these things. Your utility deposits amount, your phone deposit amount is based on your credit rating, your home loan rates are based on your credit. The banks have burrowed so far into the lives of the average guy that the average guy is working for them and everybody knows everything about those poor blokes, even their medical history...it's all good if you own a few million middle class consumers, you just beat the money out of them. The banks/financial institutions and the federal government are way too cozy with each other for the consumer to come out of this whole. The particularly aggregious part of this is now they spam your email account with medical products if you have been to a doctor using your medical insurance, spam you for consumer thingies you might like, car advertisements (since they know yours if 5 years old), a relentless pounding to get more business on one side of the street while the credit lenders attack you from the other side of the street...somebody is going to get hurt out there, it's the baseball term pickle (where is guy is on third and is trapped between third and home). So the middle class consumers are in a pickle.
If you have a credit account with one of the major institutions, they can do with you what they want. They can charge you 29% on your credit accounts or if you choose not to accept their conditions, you can close that account and pay it off and that means you have defaulted. Not a pretty landscape for the middle class and the slippage in their ability to participate in the American dream is becoming more and more compromised as each day passes. The bad thing is there is no relief in sight, in fact, since the major financial institutions have lost a bundle on the middle class home buying/equity atm spree last year, the banks will have to recover the money somewhere and it's not a stretch to have a pretty good idea of where it will come from...the prey of choice aka the middle class consumer. The only problem with this strategy is that at some point they will depleat their food source as the middle class becomes more and more financially compromised.
But what does this have to do with the investor class, be they small or big? Well, that's what I'm wondering. Are any of the candidates going to touch the third rail? third rail Will this spook the investors into going to Dubai?
Is anyone going to become a consumer advocate or should they all swing because the are no longer satisfied to live like the Joneses, they want to BE the Joneses. There is going to be a price to pay, just how do you prognosticators or thinker bees see this playing out? Consumer credit
A true consumer advocate would offer advice such as "consume less, borrow less"
Knowledge is the enemy of fear
economy is far more solid than is needed for the population. To put this into a
more accurate form. Humans' biological niche is exploding due to the changes
introduced into the enviroment and the greater efficiency and knowledge made
possible through computers.
This huge increase in wealth is being funneled into a few hands which operate
the financial and political organizations. Much of it evaporates in smoke since
sometimes this is the only way to allow concentration of the wealth.
It's very true that our financial system is a house of cards and that those who
are tinkering with it are not aware of all the risks. If they knock it down, the in-
frastructure and system of laws are probably sufficiently robust that it could be
stood back up.
These are interesting times. What has always been true is that if you stay a
step ahead of everyone else, if you don't follow the herd, if you do your own
thinking, and you plan ahead then you'll probably be OK.
look to do the following.
1. Restore the prior bankruptcy laws
2. Reinstate the usury laws to limit interest rates
on loans. Tie it to a maximum % above the prime rate
3.Begin the process of regulating and untangling the 480
trillion dollars in exotic financial instrumen
4. Tighten regulations on the types of investments that banks
are allowed to invest in. Simplify and clarify the banks balance
statements to show liabilities and assets.
5.In the mutual Fund Industry, increase oversight on how much
and how many charges are imposed on fund holders by fund management.
These are only a few of the changes necessary to protect the American Citizen.
Camelot
"consume less, borrow less"
Hello...anyone there, is this thing on?
<< <i>The next administration should
look to do the following.
1. Restore the prior bankruptcy laws
2. Reinstate the usury laws to limit interest rates
on loans. Tie it to a maximum % above the prime rate
3.Begin the process of regulating and untangling the 480
trillion dollars in exotic financial instrumen
4. Tighten regulations on the types of investments that banks
are allowed to invest in. Simplify and clarify the banks balance
statements to show liabilities and assets.
5.In the mutual Fund Industry, increase oversight on how much
and how many charges are imposed on fund holders by fund management.
These are only a few of the changes necessary to protect the American Citizen. >>
While they're at it, they might as well make certain my diapers stay unsoiled at birth and likewise before they place me in my grave. This "cradle to grave" mentality plays a very large part in WHY the American citizen needs protection to begin with. If the American Citizen was used to standing on his own two feet and making and abiding by his decisions; be they good or bad, then he wouldn't need coddled at all. This "wussification" of America would make our forefathers very ill.
<< <i>"Is anyone going to become a consumer advocate?"
A true consumer advocate would offer advice such as "consume less, borrow less" >>
That just makes too much sense. Never happen.
Knowledge is the enemy of fear
I forgot. Which party trumpets that from every rooftop?
seems to be about 10% a year. Thus to keep ones
worth at an even level, you would have to obtain close
to 13% return. For many people, the best they can do
is a 5% CD which would require a savings rate of 8% to
protect the purchasing power of ones liquid assets.
People can not continue to borrow and spend. The new
mantra must become (Be prudent and save). Much of what
we call investments, are really a part of a rigged game that
is controlled by the big banks and investment companies. In
this environment, one can not believe most of what one hears
nor even much of what one sees. Much is illusion, a facade and
a crap shoot for the majority of Americans.
Camelot
<< <i>"Is anyone going to become a consumer advocate?"
A true consumer advocate would offer advice such as "consume less, borrow less" >>
Ahhh, but where's the fun in that?
This isn't intended as a defense of the credit card companies, but the truth is- nobody is forced against their will to apply for or use credit cards. And my impression of the American Dream has never been buying lots of shiny things "As Seen On TV" with borrowed money that one doesn't know how he will repay.
But then, that's just me.
Let the various industries regulate themselves.
1. We would have no safety belts or air bags in our cars.
2. The rear end of certain Chevrolets would still be passing
the front end of the car.
3. How many of you would be willing to take a new medication for
an illness just because the manufacturer says it is safe and effective.
4. Why have the health department inspect restaurants. We can trust
the restaurant owner to keep the place clean and healthy....right.
5. Why have the FAA check the safety of aircraft. We can trust the Airline
to keep all the planes in a safe condition......right.
6.Why check the quality of imported products and food. We can trust that
the products are free of rot, lead, mercury, pest droppings or E. Coli.
I could go on for ever, but you get the general idea.
Camelot
Bear's is likely correct about needing a 5% CD to go with an 8% savings rate to stave off the dollar devaluation and that's just to stay even, we haven't even started discussing strategies for making some kind of advancement of one's position. The fiat currency is beginning to have an effect because it takes more USD to buy less goods. Consequently, preservation of wealth and buying power is indeed worthy of considerable personal strategic planning, particularly while you are using the USD, at least for now. Otherwise, individual wealth will be eroded and that's not good for anybody. For example, next year when all these foreclosed homes are absent from the tax roles, cities and everybody upstream from cities will go lacking from tax revenue. Lose tax revenue and you have to close facilities and lay off staff. It becomes a vicious cycle.
In an international market place, it seems reasonable to hold international commodities, and maybe even some international equities. Seems reasonable to assume that something compact and easy to store would be more convenient than storing 55 gal. drums of light crude in your back yard. Looks like diamonds or gold or some kind of equity shares are easy to store and have international liquidity so reasonable folk are going to deduce a similar conclusion. And...there you have it.
For entertainment purposes only.
Does this mean gold is poised to rocket upward short term?
either way. So much gold is bought and sold on pieces of paper
for gold that does not actually exist, why worry.
Camelot
notices for discount caskets, low priced funerals, cremation,
hearing aids, pills for E.D. and ads for constipation. Does someone
know something about the bear, that even the bear doesn't know?
Camelot
Does this mean gold is poised to rocket upward short term?"
I think it means that if you can get in for under 800 or even better yet, closer to 760 then it may be a good opportunity. The key is to slowly accumulate so you never have to stretch. For the smaller guys, 1/10 or 1/4 every couple of weeks and pretty soon you've got a few oz...and then after a while you have some reserves that you didn't have to hock the house for. For bigger guys, bigger plays. So, that 8% you are supposed to be saving every pay check could easily be 2% gold and 6% cash or a mixture of cash and equities. Any advancement beyond that and you are building wealth.
DYODD
<< <i>The true inflation rate and devaluation of the dollar
seems to be about 10% a year. Thus to keep ones
worth at an even level, you would have to obtain close
to 13% return. For many people, the best they can do
is a 5% CD which would require a savings rate of 8% to
protect the purchasing power of ones liquid assets.
People can not continue to borrow and spend. The new
mantra must become (Be prudent and save). Much of what
we call investments, are really a part of a rigged game that
is controlled by the big banks and investment companies. In
this environment, one can not believe most of what one hears
nor even much of what one sees. Much is illusion, a facade and
a crap shoot for the majority of Americans. >>
Bear, I hear you loud and clear and truly feel the pain.
The pain is that I feel our American Empire is done for...they all come and go. Apathy sets in, greed concours honor and noone knows their neighbor. Dog eat Dog. No leadership on both sides of the aisle. Corporations have no national allegiance.
How can Americans and politicians pay back their debt and restore this once great economy when the only advice we get is go spend money at the mall. The numbers that are spewed about low inflation, high stock prices, high home ownership and great standard of living is a sham, a house of cards.
No inflation...have these economists ever shopped for food themselves? Do they pay for their own gas or heating oil? Oh, that's right...inflation is measured "excluding volatile food and energy."
Bah....bug!
Ren
know something about the bear, that even the bear doesn't know?"
Maybe an AARP member?
Do the Bear and Mogambo Guru have something in common? Both appear to be untouchable.
roadrunner
cute and adorable.
Camelot
The bloom may be coming off the golden rose.
Editied to add.......But so far the technicals do not support a decline.
Knowledge is the enemy of fear
<< <i>BofE cut rates. Canada cut rates earlier this week. USA is cutting rates.
The bloom may be coming off the golden rose. >>
Which rose? The carry trade rose?
Do the Bear and Mogambo Guru have something in common? Both appear to be untouchable.
Maybe it's because we lionize the Bear? And roadrunner, don't worry - you're opinion is valued greatly!
I knew it would happen.
But let me throw out one idea .....
If Geo. I were to declare a 'state of emergency' which he can and make an XO order along the lines of.....
In 12 months-50% of the cars manufactured new or newly imported into this country are to be fitted for flex fuel and thereafter an additional 10% yearly up to 90% of all cars in 5 years.....
The price of oil would drop 50% in 12 months......gold would be about $500-600 or less and everybody who thought gold was on the way to $1500 would be a lot poorer.
And the U.S. economy would be like a Saturn V on the way to lunar orbit.
Apropos of the coin posse/aka caca: "The longer he spoke of his honor, the tighter I held to my purse."
<< <i>I LOVE GOLD.
But let me throw out one idea .....
If Geo. I were to declare a 'state of emergency' which he can and make an XO order along the lines of.....
In 12 months-50% of the cars manufactured new or newly imported into this country are to be fitted for flex fuel and thereafter an additional 10% yearly up to 90% of all cars in 5 years.....
The price of oil would drop 50% in 12 months......gold would be about $500-600 or less and everybody who thought gold was on the way to $1500 would be a lot poorer.
And the U.S. economy would be like a Saturn V on the way to lunar orbit. >>
Government can't decree laws that supercede natural laws. Alcohol
probably requires more fuel to produce that it releases. There is a fin-
ite amount of alcohol we're capable of producing and the more we
make the more we need.
Food prices would go up dozens fold if we tried such a stunt and the
fuel crisis would get worse. Of course we could just keep burning gas-
oline in flex fuel vehicles.
The import idea is good...let the foreigners figure it out, especially when we are buying from them.
<< <i>I LOVE GOLD.
But let me throw out one idea .....
If Geo. I were to declare a 'state of emergency' which he can and make an XO order along the lines of.....
In 12 months-50% of the cars manufactured new or newly imported into this country are to be fitted for flex fuel and thereafter an additional 10% yearly up to 90% of all cars in 5 years.....
The price of oil would drop 50% in 12 months......gold would be about $500-600 or less and everybody who thought gold was on the way to $1500 would be a lot poorer.
And the U.S. economy would be like a Saturn V on the way to lunar orbit. >>
The chances of that happening are less than zero. Remember that there is only one set of world leaders that Bush holds hands with when on a state visit - the ibn Saud family.
<< <i>Yes RR...your comments are appreciated here...don't mind the occasional troll that makes it into the yard on occasion. >>
Do I qualify as a troll in these hallowed halls.
Ren
O.K. time for an interesting story.
In 1989 a good friend came to me and said he had bought the technology, from a guy in Atlanta, to convert all vehicles to use NATUAL GAS.
He wanted me to buy a public shell corporation for him, take him public, raise ten million, and help set up the first fueling station in Austin Texas. He also wanted to build the first prototype conversation garage to convert vehicles to run on nat gas.
This mans name was Virgil Robbins, and we did all that in the first three years.
We put the first fueling station in Austin, and the then land commissioner; Gray Marrow was there to open the station.
This technology was very simple. A few gadgets added to the carburetor, a compressed natural gas tank put in the trunk, or the bed of a truck, and a switch on the dash to switch back and forth from Nat. Gas to gasoline in case you could not find a station.
We took a two-week trip to Vancouver Canada to visit their set-ups. They had over 100 natural gas stations in that city.
NO pollution, and the BTU comparison, with our equipment, was about 100 cubic feet of Nat. Gas per one gallon of gasoline. At today’s prices that would get you to 75 cents per gallon.
I am telling this story as an example of how absolutely NOTHING is going to get done to wean us off of Arab oil. All this is just another game. There are many alternatives already in place. We could be energy self sufficient in less than five years if we just spent the money we have spent on the Iraq war, but this is just not going to happen!
This government of ours now operates in crises management mode. It does no planning for the future, and just like the current housing problem its solution is to just print more money.
The ONLY thing an individual can do at this point is protect his or her own family.
<< <i>O.K. time for an interesting story.
In 1989 a good friend came to me and said he had bought the technology, from a guy in Atlanta, to convert all vehicles to use NATUAL GAS.
He wanted me to buy a public shell corporation for him, take him public, raise ten million, and help set up the first fueling station in Austin Texas. He also wanted to build the first prototype conversation garage to convert vehicles to run on nat gas.
This mans name was Virgil Robbins, and we did all that in the first three years.
We put the first fueling station in Austin, and the then land commissioner; Gray Marrow was there to open the station.
This technology was very simple. A few gadgets added to the carburetor, a compressed natural gas tank put in the trunk, or the bed of a truck, and a switch on the dash to switch back and forth from Nat. Gas to gasoline in case you could not find a station.
We took a two-week trip to Vancouver Canada to visit their set-ups. They had over 100 natural gas stations in that city.
NO pollution, and the BTU comparison, with our equipment, was about 100 cubic feet of Nat. Gas per one gallon of gasoline. At today’s prices that would get you to 75 cents per gallon. >>
There exists a power plant today that can run cleanly, efficiently, and simply on virtually any flammable gas or liquid. In widespread use, this engine would open the supply markets. Rather than gas stations, we would have filling stations where one week you may fill-up on propane, the next on methane, and the following week on bio-diesel. Ultimately, this fuel open market would be a transition to hydrogen and fuel cells.
The technology exists. We need governmental guidance to get there.
<< <i>Ultimately, this fuel open market would be a transition to hydrogen and fuel cells.
The technology exists. We need governmental guidance to get there. >>
Fuel cell technology is nowhere near soup yet. Hydrogen is costly to produce, the savings and mileage not nearly what it's backers are claiming and you'd need a fuel tank the size of a covered full sized pickup truck just to match existing vehicles currently on the road.
Ethanol is a political choice when you consider that using corn requires 70% of the energy to produce as it returns. The only thing worse they could have chosen would have been wheat, which requires 80%. OTOH, sugar cane only requires 10%. That would actually be the proper choice, but where's the profit for the friends of our politicians there?
There is plenty of oil, the earth continues to produce it on a regular basis. Nothing even remotely produces the power of gasoline per volume. Our PROBLEM IS Government guidance/intervention. We aren't able to drill and we aren't able to build refineries, that's thanks to our Government. Even the Chinese are now drilling off the coast of Florida (between Florida and Cuba).
The only country in the world which produces clean energy, the vast majority of it's energy, is France of all places. How? American technology and safe, clean nuclear power plants. We know how to do it, we just aren't allowed to on our own soil, again, thanks to our forward thinking politicians bending to the will of a loud, ignorant minority.
PS- The number of cylinders in an internal combustion engine has NOTHING to do with it's efficiency. 4-6-8-10-12 doesn't matter, it's the technology behind the motor, not the size nor number of cylinders. There's nothing wrong with building more efficient motors, and we are doing it, but throwing out the baby with the bath water isn't the answer. Free market capitalism would be the best place to start.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Think of how many jobs this would create? How much the economy would expand? How much extra money could be devoted to other projects? Problem is no one has the balls to make it happen.
Knowledge is the enemy of fear