By: The Gold Report and Eric Sprott - 9 January, 2009
A 40-year, spectacularly successful veteran of the investment industry, Eric Sprott (the "Energy Guru") needs no introduction. Sprott's steady stream of strategic, entrepreneurial and global performance awards often end in the words: "of the year." Sprott's investment abilities and knack for seeing opportunities where others don't have earned him a spot among the most successful investors in the country. Full Story
By: Bill Bonner & The Daily Reckoning Crew - 9 January, 2009
-A real boom lasts longer than most marriages…you make money by taking from the fool who gives it to you… -Our forecast for the year ahead, as promised…bounce or no bounce, stock prices are going to go a lot higher… -People come to think what they must think when have to think it…the ECB to take a page out of the Fed's playbook…watch I.O.U.S.A. on CNN this weekend…and more! Full Story
The most widely espoused view[s] of how we arrived at this juncture points to fraudulently conceived sub-prime mortgages. While I share the view that the whole sub-prime mortgage debacle was / is laced with fraud – I now question whether or not the importance of the whole sub-prime issue – as reported - might have been a canard, brought into the limelight to obscure other more insidious, mounting, geopolitical considerations. Full Story
By: Peter Schiff, Euro Pacific Capital, Inc. - 9 January, 2009
A few weeks ago when the Fed announced a strategy designed to bring down long-term interest and home mortgage rates through unlimited Treasury bond purchases, government debt staged a spectacular rally. To the unschooled market observer, the spike may be difficult to understand. After all, why would the value of Treasury bonds rise while their underlying credit quality is deteriorating faster than Bernie Madoff’s social schedule? The move is actually a perfect illustration of the tried and true Wall Street strategy of “buy the rumor and sell the fact”. Full Story
By: Adam Hamilton, Zeal Intelligence LLC - 9 January, 2009
During late 2008’s unprecedented financial-market panic, gold got something of a bum rap. Since this metal didn’t soar during the stock chaos like most of its investors expected, many assume something must be wrong in gold-land. But gold ultimately did hold its own, up 2.1% in Q4 while the S&P 500 plunged 22.4%. Full Story
By: Sol Palha, Tactical Investor - 9 January, 2009
It is said that the economy usually mimics the copper markets, and upon examining the above chart of copper, it appears that the economy and copper are trending in the same direction. Copper is now closer to a bottom than a top and hence from this we can infer that the markets are also close to putting in some sort of bottom, if one takes a long term perspective. Full Story
If the race is on to pay zero to cash savers, then ever-more cash savers might want to reach the finish line first...and jump straight into that non-paying, non-defaulting investment asset – the same asset which Gordon Brown thought had no further use back in May '99: Physical gold bullion. Full Story
In order to identify Profit Opportunities in what will surely be the Worsening Crises of 2009 we must review the Underlying Causes of these Crises. The State of the Economy in 2009 will be The Primary Factor determining The Fate of the Equities, Commodities, and Currencies Markets in 2009, as well as the loci of Opportunities. Full Story
Throwing good money after bad is precisely what the folks in Washington D.C. have been doing for years. And just like the addicted father, it is the next generation that pays the price. In many ways politicians are no different than addicted gamblers, and this latest bunch, planning to spend trillions with money they don’t have, are the cream of the crop. Full Story
By: David Morgan, Silver Investor - 9 January, 2009
The Silver Institute just put out a press release which stated, "The silver price, per ounce, in 2008 averaged a strong US$14.98, a nearly 12-percent increase over the 2007 average price of US$13.38; the best average annual price since 1980. A key development in silver’s fortune has been renewed investor interest in the white metal, which began in earnest in 2004 and continues today, as illustrated in the chart below." Full Story
By: Richard Daughty, The MOGAMBO GURU - 9 January, 2009
Apparently, the horrifying news of negative interest rates does not register with these morons; the bartender went back to talking to the pretty girl at the end of the bar, and the other barfly customers were flipping those little beer-stained cardboard coasters at me saying, 'Shut up!' Full Story
If I hear from anyone whose inflationary logic is both detailed and persuasive, I’ll reprint it here. But let me tell you up front that I’m skeptical -- so skeptical, in fact, that I doubt that we would see hyperinflation even if the Federal Government were to pay off the mortgage of each and every American, or declare a one-year moratorium on income taxes. Full Story
By: Dr. Ron Paul, U.S. Congressman - 8 January, 2009
CNNs John Roberts talked to Rep. Ron Paul about the possibilities of trillion dollars deficits in the coming years. Paul believes that the current economic crisis will worsen. The financial system broke down because they lost confidence in it because it was built on an illusion, but soon theyre going to lose confidence in the dollar. Now, that will be a crisis that will be much bigger than the crisis we are facing today. Full Story
By: Bill Bonner & The Daily Reckoning Crew - 8 January, 2009
-The world markets have begun a correction - and the governments are determined to stop it…the days of 'stuff lust' are long gone… -Replacing private spending with public spending…in the fight against global financial illness the Fed can't cure the patient… -The U.S. empire may be too old and tired to battle this downturn…the 50th anniversary of Cuba's revolution…tune into the Critic's Choice Awards on VH1 tonight and cheer for I.O.U.S.A.!…and more! Full Story
By: Chris Powell, Secretary/Treasurer, GATA - 8 January, 2009
A year ago "Newstopia," the weekly satirical comedy program of the Special Broadcasting Service in Australia, the public broadcasting network there, aired a 3 1/2-minute mock interview with an official of the Reserve Bank of Australia, the Australian central bank. It features the writer, actor, and comedian Shaun Micallef as the television newsman and Nicholas Bell as the RBA official, and it is a hysterical and devastating parody of the aloof smugness and imagined omnipotence of central banking. Full Story
By: Gary Dorsch, Editor, Global Money Trends newsletter - 8 January, 2009
What was viewed as inconceivable a year ago is now a reality - roughly $30-trillion of wealth was erased from global stock markets, during a brutal 15-month bear market that began in October 2007. Speculators scrambled for the exits as a crisis originally thought to be limited to the US-mortgage sector morphed into a full-blown “credit crunch,” unlike anything experienced since the Great Depression of the 1930’s. Full Story
Gold naysayers habitually point to the relatively weak performance of gold relative to the broader market over the last 5 years. Given the market today, that argument is increasingly wrong, and the naysayers are soon to either admit their mistake, or pretend that they were never naysayers at all. That’s because during the last 3 months, five major new forces have emerged to compound the previous strong drivers of the gold price up to now. Full Story
Many of you know my distain for the bulk of so-called professionals on Wall Street. You know I feel most are like a real estate salesperson tossed off the Empire State building who says all the way down, “so far so good.” The Archangel Gabriel could show up in these folk’s bedrooms and tell them the stock market was going to fall or not go up, yet most would ignore such warnings because their job (and bosses) depends on them getting people to buy. Full Story
By: Andrew Mickey, Q1 Publishing - 8 January, 2009
Warren Buffett is known for only investing in businesses which he understands. He says individual investors should look at being a shareholder as being a “part owner” of the business. Full Story
Keynesian capitalism continues to bring with it a saga of never ending bubbles. In just the past decade, we have been faced with the internet bubble bursting of 2000 and a massive real estate bubble that has brought the American economy to its knees. All are examples of a gross misallocation of resources caused by an excess money supply searching for home. The recent credit crunch has provided us with an opportunity to deflate and wipe away all unnecessary liquidity but the Federal Reserve, along with their posy of world bankers, have chosen instead to attempt to reflate a balloon that has already burst. Full Story
The happy part is mostly up to us, but as for the prosperous part it’s going to be very difficult for most of the world’s population with the current recession. It seems that the economy is getting worse by the week, with increased layoffs, dire profit warnings, and looming bankruptcies. Full Story
Gold traders should have exited today as prices are showing strong signs of lower prices in the near future. Gold slid over 4% this week so far, while gold stocks have dropped an average of 9%. Full Story
By: Richard Daughty, The MOGAMBO GURU - 8 January, 2009
And this, together with the economic disaster that is already out there, only proves the utter, utter failure of the Federal Reserve to 'preserve the value of the dollar', which is their freaking mission in life. Morons! Full Story
Today and tomorrow we will be featuring the thoughts of two erstwhile gold bugs who are having second thoughts. Although both evidently believe in their hearts that gold is honest money, neither is certain that that will suffice to push its price into the stratosphere, as some seers are predicting. Full Story
By: John Browne, Senior Market Strategist, Euro Pacific Capital - 7 January, 2009
One of the few things more troubling for an economy than government intervention is government intervention driven by panic. Time and again, history has shown that when governments rush to engineer solutions to pressing problems, unintended difficulties arise. Full Story
By: Bill Bonner & The Daily Reckoning Crew - 7 January, 2009
-The economic news continues to bring bad tidings…consumer bankruptcies were up 33% in 2008… -The financial crash is causing an economic crash, which will cause a worse financial crash…and around and around we go… -Who will spend their savings in '09?…the CBO puts the budget deficit at $1.2 trillion for this year - and that's not counting stimulus programs…and more! Full Story
The marquee line best describing the past two to three months has been that the Dollar Death Dance has been fueled by failure of US banks & corporations, along with sponsored assaults against speculative hedge funds. The climate has changed from liquidation and bankruptcies, obviously steered and exploited by the Powerz, toward more legitimate attempts to have a recovery initiative take root across the landscape, It is fast approaching a wasteland. Full Story
By: Bob Chapman, The International Forecaster - 7 January, 2009
The anticipation of continued Treasury and Fed monetary creation, a $1.3 trillion or more budget deficit and a trillion dollars in stimulus spending by the new administration should cause a market rally in January and perhaps a while longer. Those who are short the market can consider taking some profits and re-shorting later. We know some of the subscribers have massive gains. You should be all in on gold and silver coins and shares and add to positions whenever you can. Full Story
How long before Kitchener's well-oiled moustache is replaced by Barack Obama's audacious grin? The great hope of 2009 has yet to take office, but Washington already needs to sell some $2 trillion-worth of Treasury bonds this year according to one guess-timate, simply to plug its current funding deficit. Full Story
By: Doug Hornig, co-editor of BIG GOLD, from Casey Research - 7 January, 2009
2008 is now in the rear-view mirror, with virtually every investor shouting “Good riddance!” and praying for a better year to come. Forget about making money, just keeping your head above water was an accomplishment over the past twelve months. Full Story
By: Peter Zihlmann, Zihlmann Investment Management AG - 7 January, 2009
The chart above clearly shows one thing: long-term trends often last many years. The bear market that started in 1988 ended in 1993. The up-swing that followed lasted three years from 1993 until 1996 and culminated in what may be called a false break-out. Then another bear-market unfolded taking the gold price down to $250 over a period of almost four years. Full Story
The first well-documented widespread use of paper money was in China during the Tang (618-907 A.D.) dynasty around 800 A.D.[1] Paper money spread to the city of Tabriz, Persia in 1294 and to parts of India and Japan between 1319 to 1331. However, its use was very short-lived in these regions. In Persia, the merchants refused to recognize the new money, thus bringing trade to a standstill. Full Story
We now know a little more about the global financial crisis from the terrible experience of 2008, and can trace its causes back to cheap credit after the dot-com crash of 2000 and a huge volume of bad lending in the US housing sector which spread like a cancer around the world by the securitization of mortgages. Full Story
By: Steven Saville, Speculative Investor - 7 January, 2009
Changes in money-supply trends affect prices in ways that are often difficult to predict, thanks in part to the lengthy and variable delays involved. However, it is still possible to explain much of what has happened to prices and much of what will likely happen to prices in terms of money-supply changes. Full Story
2008 was a brutal, bitch of a year. Nothing like the Bold and Beautiful most housewives or closest trash junkies know and love. (I am occasionally included in this list). Based on the brutality, I decided that the four day Christmas break was a given, followed by another four day new year stretch if I jagged Friday off. Full Story
Gold, silver, copper, and other commodity and energy stocks are beginning to show strong chart patterns, and some have broken out of potentially powerful formations. Here are a few stocks mentioned in the last two market reports. Full Story
I have absolutely no confidence this run in infrastructure stocks can last. In fact, I expect it to end abruptly in the coming weeks and months once reality sets in. You see, the herd is once again acting irrational. The government funded build-out of U.S. infrastructure is a short-term trend which will not last indefinitely for many reasons. Full Story
By: Richard Daughty, The MOGAMBO GURU - 7 January, 2009
Unfortunately, while I am exactly like the Federal Reserve in that we are both total, complete failures at our jobs, mostly through sheer stupidity, the repercussions are quite different. Full Story
I had expected 2009 to begin with gold sharply on the rise and stocks in retreat, but so far both seem to be taking direction from a headless chicken. Stocks lurched higher last Friday on a short squeeze but have since gone erratically flat. As for commodity gold, it has been pretty wild the last few days but is still trading somewhat below its New Year’s peak, even after yesterday’s trampoline recovery. Full Story
By: Bill Bonner & The Daily Reckoning Crew - 6 January, 2009
-A look at the economic goings-on that take place on this, the third rock from the Sun… -The Dow is up again - could this be the beginning of a major rally?…pinning hopes on a stimulus package…much talk of cutting taxes, but not of cutting spending… -Find a premise that is wrong, and bet against it…for gold bugs, it's now or never…and more! Full Story
By: Brady Willett and Dr. Todd Alway - 6 January, 2009
Give a man to fish and you feed him for a day. Teach him how to print money and you feed him for a lifetime? Juxtaposed against this seemingly outlandish re-write of the popular Chinese proverb is the image of the U.S. trying to inflate away the ills of asset and debt deflation. Full Story
By: The Gold Report and Jack Lifton - 6 January, 2009
Jack Lifton, a consultant, author and public speaker with more than 45 years of experience in sourcing and recycling minor metals (including the rare earths), shares his views on the current balancing act between technologies production and available natural resources. Mr. Lifton identifies these dwindling resources and the mining companies in which to invest, as he warns of the devastating effect production cuts will have on our everyday lives in "the age of technology metals." Full Story
By: Sol Palha, Tactical Investor - 6 January, 2009
Investors should not let fear overwhelm them; fear and euphoria play nasty tricks on one’s mind; opportunity is made to look like a disaster and disaster looks like opportunity. We still believe that the current economic situation will worsen before it gets better, but if you wait till the majority deem that it is safe to venture forth and purchase stocks, the train will have left the station, and you will be left holding a worthless ticket. Full Story
They’ve done it now. The Fed has revealed the level of panic they are in behind the scenes by cutting rates to zero and promising unbounded quantitative easing. Here, it should be noted that based on remarks from the Fed Policy Statement Tuesday, quantitative easing is now set to go beyond the bailout style monetiziations of financials that have primarily characterized re-inflation efforts under the gaze of Bernanke and Paulson so far to include just about anybody who needs ‘social assistance’, which apparently includes all degrees of bad investors / speculators these days. Full Story
Substitute silver for Madoff, and CFTC for SEC, and I think you can visualize the silver manipulation with clarity. The long-term nature of the frauds, the amount of money involved, previous outside warnings, and the obviousness in each, if one would only look with clear eyes. Full Story
The year 2008 will be written about in finance textbooks for generations to come. The inevitable collapse of the boom, built single-headedly on credit, finally came home to roast. Ironically, further liquidity is what has, thus far, ensured the survival of the system. Having received the rubber stamp for a $700B bailout, leave it to politicians to decuple that number to, a now estimated, $7 trillion. A liability that is set to fall on the shoulders of your kids and grandkids that realistically will never be paid off. Full Story
The Era of Simple Solutions continues to unfold. For every complex problem, as the wise man once said, there is a simple solution, that is wrong. Into the abyss of collapsing financial institutions rode the Federal Reserve, with a check book in each hand. The crowd went wild over this simple solution. And in response to the fundamental failure of U.S. auto companies, welfare checks were mailed to them. Full Story
Since late November we have been following potential bottoming patterns in US and global stock markets with Inverted Head & Shoulders in the Dow and S&P 500 and a clear series of higher highs and higher lows in the Hong Kong market. Bullish divergence has been present throughout the bottoming process in our often watched ‘panel’ indicators like MACD and RSI. You name a major global market… Europe, Japan, they are all following some version of the bottoming scenario Full Story
The phrase, speculative bubble, is used to describe the financial tumescence that characterizes the often manic unfounded rise of asset values. The phrase, however, is inadequate for it fails to convey the destructive aftermath that follows; for such purposes, train wreck, is a better description. In 2009, the largest train wreck in economic history is about to occur. Full Story
By: Richard Daughty, The MOGAMBO GURU - 6 January, 2009
Well, egg rolls or not, pretty soon everybody is going to have more egg rolls, as the Chinese are engaging in massive stimulus spending, too, just like we and everyone else are… Full Story
With the global economy caught in a deflationary vise, I queried Bob Prechter recently about gold’s prospects. He is the right guy to ask for two reasons. First, his 2002 book At the Crest of the Tidal Wave established him as the foremost expert in the world on the subject of deflation. And second, as someone who has been relative tepid toward gold, perhaps he can explain why bullion quotes have not been hitting new highs even though fiscal and monetary policy in the U.S. and elsewhere have turned recklessly expansive. Full Story
By: Bill Bonner & The Daily Reckoning Crew - 5 January, 2009
-A year without question marks…stocks have been up for the last three trading sessions - even dead cats bounce… -The U.S. is facing a political problem, not an economic one…Obama's American Recovery and Reinvestment Plan…but what is there to reinvest? -The price of gold is going up - and people are finally catching on…will Mr. Market pull another fast one?…economics is not improv theater…and more! Full Story
- WHAT on earth...? - Sorry, if you could just keep turned to the wall... - But what in the hell is that?! - This? Why, it's the...ummm...it's the Easer! - The what? - The Easer. You know, for the Quantitative Easing. Now, if you could just keep facing the wall for me... Full Story
By: James West, The Midas Letter - 5 January, 2009
Last was a watershed year for many obvious reasons. But tucked away in the dark clouds of 2008 was a silver lesson for 2009: The redefinition of risk. Take all the most respected analysts and ratings service providers, newsletter commentators and financial columnists, and in determining their trustworthiness, pose one simple question: How do you determine risk? Full Story
It is surprisingly frequent in the financial markets that important reversals occur right around New Year’s. If you pour over the old charts, you will see, again and again, that a major top or bottom in an important market occurred either on Dec. 31 or Jan. 2. Assuming 250 trading days in a year, the odds of this happening by chance are 1 in 125. But the charts show that the actual number is closer to 1 in 10 or 1 in 20. Full Story
By: David Chapman, Union Securities - 5 January, 2009
We suppose we could have premised this as “Annus Horibilis” but we weren’t sure whether the Queen would approve. We also couldn’t help but notice a John Mauldin missive that also used the same title “2008: Annus Horibilis, RIP” John Maudlin January 2, 2009. What can I say? We are all thinking the same thing. Full Story
The old man of 2008 has yielded his place to the baby New Year and with it a changing of the guard. Not only has 2009 brought a fresh new start with a clean slate, but also a new series of Kress cycles. Full Story
Although the inverse relationship between the US dollar and gold is true most of the time, there have been extended periods when both gold and USD appreciated in value. We only have to go back a few years to see a positive relationship between the two. Believe it or not, even in 2008, gold gained 5.8%, while the US Dollar Index gained 7.5%. Full Story
Strangely economic commentators have missed the most obvious impact of the tragic Gaza War on the global economy: oil prices are going to rise, and will go sharply higher if the war widens into a regional conflict, so too will precious metal prices. Perhaps this perception will change now that a serious ground offensive has started. Full Story
Because powerful rallies often look like fakes initially, we shouldn't be too quick to diss last week's vaporous surge, which sent the Dow wafting 700 points higher in the space of just four days. Another 100 or so points of such hot-air magic on Monday and bears could find themselves seriously on the ropes. Full Story
Gold gained $8.30 for the week (+0.95%), closing at $879.50 (continuous contract). It was impressive to see gold rally in the face of a rising dollar. Short term – one of the two is going to change direction. Full Story
1st Hour: Headline news & Market Weatherman Forecast. Spotlight Stock Picks with big dividends. The International Forecaster and Host Chris Waltzek answer listeners' questions. 2nd Hour: Doug Casey Full Story
By: Steven Saville, Speculative Investor - 4 January, 2009
There are some important similarities between the present and the 1930s. For example, in TSI commentaries over the past 6 months we've discussed the similarities between 1937-1938 and 2007-2008, both with regard to the economic situation and the performance of the US stock market. It is therefore apropos to review how the gold sector of the stock market performed during the 1930s. Full Story
We've been here before haven't we? Gold has been in a rising trend for some considerable time, taking it to trendline or resistance targets, and then "wham!" it gets whacked back down again. Certainly the long-term outlook for gold is excellent, especially given the strong and increasing demand for physical, but over the short to medium-term it now looks set to get taken down again. Full Story
Gold closed higher for the week with very low volume due to the holidays. It is difficult to get a feel for where stocks and commodities are headed in the near term because of this light volume. Generally during holiday season light volume favors the longs and prices generally drift higher, which is what we had last week. The charts below will show you how I see the market and how I react to these salutations. Full Story
By: Bob Chapman, The International Forecaster - 4 January, 2009
A re-inflation is on its way. You can just see it coming. Nuts of taxpayer largesse are being stuffed into baggy little banker cheeks via TARP, to be hoarded until the Fed gives the word. An explosive Fed balance sheet, rampant monetization of treasuries, bailouts galore and exchanges of treasuries for toxic waste are offsetting whatever deflationary impacts are affecting the money supply on account of falling asset prices, CDS losses and de-leveraging, to the tune of over $9 trillion dollars. Full Story
By: John Mauldin, Millennium Wave Advisors - 4 January, 2009
This week we look at a very interesting, if not altogether encouraging, piece of research on the length and severity of recessions that come during periods of financial crisis, which can apply to not just the US but all countries that are involved in the current crisis. But being forewarned is better than blindly stumbling through, so we will take some time to peruse it. Then we (briefly) look at the depth of the manufacturing numbers in the US, which leads us into the recent bout of earnings downgrades and some thoughts as to where that might suggest the market is going. Full Story
By: Andrew Mickey, Q1 Publishing - 4 January, 2009
There are plenty of ways to take advantage of a coming rally in gold, but I consider the short gold/long gold stocks the trade of the year. It’s a “win/don’t lose” type of trade which only comes along every once in a while. If you keep an eye on risk/reward, there won’t be too many better trades you can make this year. Full Story
You have to imagine the hedge fund professionals playing it cool yesterday while the Dow rallied by 2.9 per cent on the first day of the New Year. Only they know the size of redemptions that they need to fulfill after the rush to the exit at the end of last year. Full Story
By: Richard Daughty, The Mogambo Guru - 4 January, 2009
Hell, at that rate, I'll personally hire 5 or 6 people right now, full-time, to get my yard, trees and shrubberies in shape, wash and wax the cars, and do all of that fixing, painting and replacing of broken, leaking or noisy crap around the house… Full Story
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