By: Bill Bonner & The Daily Reckoning Crew - 25 July, 2008
*** Why the price of gold may be overpriced…the real threat you face is located east of one ear and west of the other…
*** Other shoes are going to drop within the U.S. economy…American household finances are deteriorating rapidly…
*** Get your children Swiss bank accounts…sell stocks, buy commodities…and more insights and advice from this year's Agora Financial Investment Symposium! Full Story
Virtually all the Market Crashes, beginning with the Great Crash of 1929, and including the crashes of 1957, 1965-1966, 1972-73, 1986, 1987 and 1998-2000, from Major Equities Markets Tops have one Technical Pattern in common: The Jaws of Death. Full Story
By: Peter Schiff, Euro Pacific Capital, Inc. - 25 July, 2008
With President Bush no longer threatening a veto, the subprime mortgage and Fannie and Freddie “bailout” bill is now sailing through Congress. In anticipation of its enactment, Congress had the foresight to raise the national debt limit to $10.6 trillion. Who says that politicians don’t plan ahead? Full Story
By: Richard Daughty, The Mogambo Guru - 25 July, 2008
Perhaps the reason that Treasury Secretary Paulson wants to bail out Government Sponsored Entities (GSEs) like Fannie Mae and Freddy Mac is because of who owns the shares of the companies, which will go to zero if Fannie and Freddie are allowed to fail like they deserve to do. Full Story
When the stock market rockets higher on some days and plummets violently on others, we need to remind ourselves that it’s not a Jekyll-and-Hyde performance we are witnessing, but pure, unmitigated Mr. Hyde. A monster. Full Story
THE UGLIEST PART OF THE ENTIRE FINANCIAL PATHOGENESIS IS THAT MOMENTUM IN THE BREAKDOWN IS FIERCE, AND FEEDBACK LOOPS ARE UNSTOPPABLE, AS THEY FORCE DE-LEVERAGING AND POWERFUL CONTINUATION OF THE PRICE DECLINE FOR ALL ASSOCIATED ASSETS. In its wake lie gold & silver, which benefit from the retreat from a burning collapsing building built of paper girders and paper walls, held by faulty risk price model glue. Full Story
Fannie Mae, Freddie Mac, $3.9 Billion Dollar in rescue packages, a curtailing of Short Selling, talk of the Fed hiking interest rates in October, an investigation into Oil trading, and arrests and charges of market manipulation in energy prices have all taken place this week. Full Story
The financial system will collapse before "zero-hour" actually occurs. I think we are seeing signs of it in the desperate measures being employed to nationalize companies which trade on market exchanges as private enterprises. There is simply no way to defend the SEC's decision to selectively enforce the prohibition of naked short selling for 17 ‘fragile' financial companies and to not enforce it for the over 5000 other companies which trade on US stock market exchanges. Full Story
By: Bill Bonner & The Daily Reckoning Crew - 24 July, 2008
-"The rich" aren't as rich as they think they are…why so unhappy? -Living in a cartoon house with Jim Kunstler…the truth behind cutbacks in consumer spending… -An Oscar-worthy cameo in I.O.U.S.A.? No, probably not…a golden success story from the Solomon Islands…and more! Full Story
By: Gary Dorsch, Editor, Global Money Trends - 24 July, 2008
On the morning of July 15th, the price of crude oil, the most widely watched commodity in the world, was gyrating in a narrow range, just above $145 /barrel, as dealers in London were position-squaring ahead of the Nymex opening. Just a few days earlier, Iran was conducting war games in the Persian Gulf and threatening to shut down the Strait of Hormuz, if attacked. The world watched a fireworks display of Iranian Shahab-3 missiles that were armed with one ton explosives. Full Story
A sharp fall in the oil price and a consequent recovery in the US dollar brought a sharp retrenchment in precious metal prices this week as gold approached the $1,000 barrier for a second time and silver closed on $20. Full Story
By: Richard Daughty, The Mogambo Guru - 24 July, 2008
The Paulson Package solves all of our problems! It merely requires you to give me permission to use either unlimited company funds to spend at my total secret discretion, or give me immunity to use a bazooka or baseball bat to whack our enemies… Full Story
So what do we think of the bearish price action yesterday in precious metals? We see it as a buying opportunity, and we will therefore continue to update our forecasts with correction targets that can be bottom-fished with relatively little risk. In the meantime, anyone who thinks the selling in precious metals is going to continue for much longer obviously does not understand the implications of a Federal budget deficit soon to leap above $10 trillion and presumably out of control. Full Story
As we look out over the next six months what we see will be extraordinary. The opportunities for prepared investors have never been brighter as the unfolding volatility will be incredible. “Volatility is Opportunity” for the prepared investor and it will arrive in spades. After a short period of corrective activity I believe explosive moves in almost ALL SECTORS (interest rates, stocks, commodities, natural resources, currencies, and more) lay on the near horizon. Full Story
By: Short Fuse & The Daily Reckoning Crew - 23 July, 2008
-Themes from Day 1 at the Agora Financial Investment Symposium…saying goodbye to the veto… -Does the term "hemorrhaging money" mean anything to you?…Zimbabwe is just a mess… -Wise words from the late great Dr. Kurt Richebächer…straightforward advice from a financial 'rock star'…and more! Full Story
By: Bob Chapman, The International Forecaster - 23 July, 2008
So far this week we saw Wachovia get socked for an $8.86 billion loss with a layoff announcement of 10,750 employees, while Washington Mutual got hammered for a $3.3 billion loss and increased its beleaguered loan-loss reserves by $3.74 billion to $8.46 billion as it announced expense cuts and asset sales. This is nothing. This is just the beginning. This is just window dressing to protect incumbents. Full Story
By: John Browne, Senior Market Strategist, Euro Pacific Capital - 23 July, 2008
In recent months, even the most blindly optimistic forecasters have come to grips with how our banks and investment banks took wildly imprudent risks that will result in horrific losses. The resulting sell-off in financial shares has tempted many investors to scoop up these companies at apparently fire sale prices. Wise investors should resist the temptation, as the pain for financials is just getting started. Full Story
I have good news and bad news. The good news is that we are getting richer, and a recession, while painful, is not going to stop the advance of economic growth. The bad news is that the Federal government will continue to spend more, interfere in our lives more, and take away more of our privacy. Full Story
Clean tech is global, with more public companies headquartered in Europe and Asia than in the United States. And some of the leaders—like Danish wind turbine maker Vestas Wind Systems and German solar panel giant Q-Cells—don’t even list their shares on U.S. exchanges. This complicates things for American investors, but not insurmountably. As with most things that involve the exchange of information, trading foreign stocks is getting easier all the time. Here are some ways to do it. Full Story
By: Richard Daughty, The MOGAMBO GURU - 23 July, 2008
An adult-club owner named Joe Redner says that although business is down 25%, 'the economy does have one upside for the business - it's bringing out more women willing to give pole dancing a try.' Hahaha! Full Story
Yesterday’s 135-point rally in the Dow owes a debt of thanks to Hurricane Dolly, which has tacked north of oil rigs in the Gulf, reducing the threat to U.S. energy supplies. Crude oil quotes were down more than $6 at one point as result, helping to propel the broad averages moderately higher. “Moderately” is the right word here, or perhaps “disappointing,” considering the drubbing crude was getting. Full Story
Gold remains under pressure as oil continues to lose ground. Dollar supportive rhetoric from Treasury Secretary Paulson and hawkish comments from the Fed's Plosser boosted the greenback on Tuesday, putting additional pressure on the yellow metal. Full Story
"There is no question, about it. Wall Street got drunk...that's one reason I asked you to turn off TV cameras...he's got drunk and now it's got a hangover, the question is, How long will it sober up and try not to do all these fancy financial instruments?" - President George W. Bush Full Story
When I lived in South East Asia thirty-five years ago the farthest thing from my mind would be recommending that Americans create their own last plane account. However, I have seen in my six decades on this earth how things can change. I think having a last plane account is basic common sense. Full Story
-Comments about Fannie and Freddie affect oil prices… -A word from Dan Denning on the global oil crunch… -The safest, most profitable places to put your money during the energy crisis…and more! Full Story
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 22 July, 2008
Last week all was well, as no less a person as Paulson, the Treasury Secretary reassured us all that Fannie Mae and Freddie Mac were sufficiently capitalized. Last weekend a plan was put into effect to ensure their survival. The second largest bank failure ever in the States Indy Bank went bust. Many believe that we will see up to 150 U.S. banks go down in this worsening credit crunch. Full Story
On Tuesday, as the S&P 500 briefly touched 1,200, the banking sector represented by KBW Bank Index [$BKX] (or other similar indices) went down to 47 (which had been range bound and traded around 75-90 early this year), and VIX reached 30, it seemed that the stock market was under capitulation similar to the March plummet. The dropping of $BKX was so severe that it broke my technical target of 55 by 8 points. Full Story
Money served throughout history as a medium of exchange and as a storehouse of value. But when gold and silver coins were replaced by paper currencies, money no longer was the same. Paper money, no longer having intrinsic value, now functions only as a medium of exchange, a function that degrades over time. Full Story
Yes, gold. What else? After I likely take a small loss on the QQQQ today, precious metals & cash/short term treasuries will be my only positions. I want to focus on the metal, not the miners today. After all, the gold miners are a speculative playground (and you know I spend a great deal of time playing there) and in my book are not to be viewed as long term investments of the quality of gold bullion. Full Story
By: Steven Saville, Speculative Investor - 22 July, 2008
In an article posted earlier this week, Mike "Mish" Shedlock weighed in on the TMS vs. M3 discussion. Mish's article supports our view that TMS (the "True Money Supply" developed by Murray Rothbard and Joseph Salerno) is a more appropriate measure of money supply than M3, although he prefers a measure called "M Prime". The main difference between TMS and M Prime is that TMS includes savings deposits whereas M Prime does not. Full Story
By: Richard Daughty, The MOGAMBO GURU - 22 July, 2008
Note the clever way that I used three exclamation points to emphasize the fact that 1.58 billion cards in the hands of Chinese shoppers is a lot, and is equal to 5 cards for every man, woman and child in America! That's buying power! Full Story
By: Bill Bonner & The Daily Reckoning Crew - 21 July, 2008
-Foreign investors nervously chew their fingernails…the worrisome but necessary "blank check"… -The single most important economic trend…the dollars are back to haunt us… -Fundamental economic misallocation…the key to our financial woes…and more! Full Story
This essay looks at the seasonal lows for the HUI index, and examines the rise that followed this low, for the past 9 cycles (1999 – 2008). This study should give us a good idea for future expectations, regarding the remainder of 2008. “As the HUI goes, so goes the gold price”. Full Story
For gold bugs, the past few years have been kind of peaceful, intellectually speaking. Because they understood the dynamic of fiat currency leading to excessive borrowing leading to financial crisis, they were neither confused about what was happening nor swayed by the gibberish that passed for expert opinion. Alan Greenspan could ramble and Larry Kudlow could rant, but who cared? In the end the laws of economics would prevail; housing would tank, inflation would surge, and gold would soar. Full Story
If there has been one issue which I have focused more on than any single issue over the years, it has to be short selling in silver related investment vehicles, primarily the concentrated short selling in COMEX futures, and more recently, the naked short selling of the shares of the silver (and gold) ETF’s. Naturally, I was very interested in the just announced emergency order by the Securities and Exchange Commission (SEC), temporarily restricting naked short selling in selected financial stocks. Full Story
Many people are now being rudely awakened from slumber with respect to the effects on prices resulting from inflation, even if they only see the effects (rising prices) and not the cause. More specifically, as the cost of energy shoots higher, the lights are finally coming on for many consumers previously in the dark about what lies ahead. Full Story
Paper, one of the four Great Inventions by the Ancient Chinese along with printing, the compass and gun powder, was invented by Cai Lun in 105 A.D. from bark, rags, wheat stalks and other materials. The first historical use with paper money began shortly thereafter around 140 B.C., nearly 1800 years before its arrival in Europe. How this money came to an end is not known. Full Story
We have finally gotten our break in oil. That is a major fundamental relief because with manic oil bulls stampeding, congress and the administration fretting (and plotting hair brained solutions) and the Fed stuck in a box made with walls of Greenspan's easy money policy (inflation) and the effects of that policy (escalated prices), all of us - from the average guy going paycheck to paycheck to precious metals investors - were being held in suspended animation. Full Story
We did a double take on the following headline atop Friday’s edition of the Wall Street Journal: “Mortgage Giant Freddie Mac Considers Major Stock Sale”. This plan gets our vote for the dumbest idea we’ve ever heard from Wall Street. A cruel joke on shareholders, perhaps? Full Story
1st Hour: Headline news & Market Weatherman Forecast. Spotlight Stock Picks with big dividends. The International Forecaster and Host Chris Waltzek answer listener questions. 2nd Hour: Gary Dorsch, editor of the Global Money Trends newsletter Full Story
By: Dr. Ron Paul, U.S. Congressman - 20 July, 2008
I have, for the past 35 years, expressed my grave concern for the future of America. The course we have taken over the past century has threatened our liberties, security and prosperity. In spite of these long-held concerns, I have days – growing more frequent all the time – when I'm convinced the time is now upon us that some Big Events are about to occur. These fast-approaching events will not go unnoticed. They will affect all of us. They will not be limited to just some areas of our country. The world economy and political system will share in the chaos about to be unleashed. Full Story
By: Bob Chapman, The International Forecaster - 20 July, 2008
After the markets closed on Friday, the announcement came that Freddie Mac plans to sell $5.5 billion dollars worth of new common and/or preferred shares to private investors, when its current market cap is only 6 billion. Of course, they had to register the new issue with the SEC and get its approval in order to do this, and on Friday, they filed with the SEC, which quickly approved the new issuance. This was no surprise of course because the SEC and Freddie are run by the same Illuminist scum. Full Story
By: John Mauldin, Millennium Wave Advisors - 20 July, 2008
Housing starts rose 9% and the market cheerleaders proclaimed that we have seen a bottom. But not if you look at the actual numbers. New unemployment claims were OK, but not if you look at the actual numbers. And inflation was simply ugly, no matter what numbers you look at. However, oil is down and there is reason to think it may have further to go on the downside. We cover all this and more, as we first look at why the world is not going to end. Full Story
By: Richard Daughty, The MOGAMBO GURU - 20 July, 2008
My head is swimming and I feel a swoon coming on at the idea of 38% inflation, and I would have fainted, too, if I hadn't remembered what happened the LAST time I had a fainting spell because of inflation in consumer prices… Full Story
A lot of change occurred last week so there is much to cover. The focus will be on the commodities markets and especially silver and gold. Many charts are included. Charts are always open to interpretation, as beauty is in the eye of the beholder. Adjust the view accordingly. Full Story
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