By: Bill Bonner & The Daily Reckoning Crew - 9 February, 2007
-Understatement of the year: subprime lenders are having a rough time…Desert Storm Three… -Household problems…Anna Nicole Smith, we hardly knew ye… -Vive la resistance…protesting slowly to catch your breath…and more! Full Story
As you have probably heard by now, a blue-ribbon panel recently advised the IMF to sell gold as a way of trying to clean up its finances. The news initially spooked some weaker holders and hedge fund managers, most of whom are clueless about the overarching trends driving gold. However, as Doug Hornig makes clear in the following report, the proposed IMF sales represent much ado about nothing… other than perhaps creating a buying opportunity, that is. Full Story
"Good art speaks truth, indeed is truth, perhaps the only truth," wrote Iris Murdoch in The Black Prince – and seeing how Peter Doig's White Canoe (1990) was deemed good enough to fetch $11.3 million at auction on Wednesday, that would mean the only truth today is inflation. Full Story
By: Peter Schiff, Euro Pacific Capital, Inc. - 9 February, 2007
Recently voiced concerns from the Chinese government that their surging domestic stock market was crossing into bubble territory helped to set off last week’s sharp decline, including a single day plunge of 6.5% (the equivalent of more than 800 points on the Dow Jones.) While a bubble may indeed be forming in Chinese stocks, my guess is that there is room for a lot more air before it finally pops. Full Story
By: David N. Vaughn, Gold Letter, Inc. - 9 February, 2007
I continue to lose my patience with those who buy and hold forever and never sell. And I am talking about those who truly never do sell. In Vancouver I talked with an investor who had 100 stocks in 100 different companies and was afraid to sell a one in fear of missing out on one more leg up in price. Another investor had 60 different stocks. Clearly that is a little bit too much to be able to manage appropriately. And a sign that someone doesn’t know when to sell. Full Story
By: Rick Ackerman, Rick's Picks - 9 February, 2007
After an ugly opening (see chart below), market bellwether IBM valiantly clawed its way back to a small gain at the close, helping the Dow Industrials pare earlier losses by nearly two-thirds. Yesterday’s comeback was so very impressive, in fact, that we can only surmise that bulls are about to get their teeth kicked in. To paraphrase Oscar Wilde, a stockbroker would need to have a heart of stone to watch yesterday’s rally unfold without feeling the sadistic urge to coax a few clients out onto the ledge. Full Story
By: Kevin Kerr & The Daily Reckoning Crew - 8 February, 2007
-Don't count on that U.S. budget surplus - after all, consider who's handling the cash… -No one is feeling very funky in Motown…a Black and White Ball… -Hedge Fund job to the highest bidder…and more! Full Story
The following paper will discuss the above linked article that was given as a presentation in Davos, Switzerland by Mr. Mohamed El-Erian: President and CEO of Harvard Management Company, a faculty member of the Harvard Business School, and deputy treasurer of the university. He is also a member of the International Monetary Fund’s Capital Markets Consultative Group. Credentials par excellence. Full Story
By: John Rubino, DollarCollapse.com - 8 February, 2007
Today's bubble in novelty and complexity is sure to blow up – if not in 2007, then all in good time. You might like to hold gold as insurance. For the "barbarous relic" – so beloved of apparently naive investors in the booming economies of India, China and the Middle East – is the ultimate antidote to "financial innovation". Nobody's promise, gold is also no one's to create. Full Story
By: Bob Chapman, The International Forecaster - 7 February, 2007
The only thing really holding the economy together is the enormous faith in the ability of the Fed to keep the bubble inflated. What professionals and the public do not understand is that much of the debt accrued at all levels can never be paid back. The question is has this faith been well placed and can the Fed keep the bubble expanded with no negative consequences? Bubbles of this type end when the Fed is no longer willing or able to provide further credit on when consumers or businesses are no longer willing to borrow. Full Story
By: Dan Amoss & The Daily Reckoning Crew - 7 February, 2007
-An Alfred E. Neuman market...is the whole country suffering from disaster myopia? -The surer the profits, the surer the disaster...inflation is now illegal in Zimbabwe... -Good news for the homeless - there are plenty of houses to choose from...the path of all empires...and more! Full Story
President Bush sent a $2.9 trillion spending plan to a Democratic-controlled Congress on Monday, proposing a huge and continuing increase in military spending. While the budget includes billions more to fight the war in Iraq, the rest of government would be squeezed to meet Bush's goal of eliminating the deficit in five years. Full Story
By: Richard Daughty, The MOGAMBO GURU - 7 February, 2007
I remember the old days when a jump in Total Fed Credit of $7 billion in a week, like the one we had last week, would have sent me to the emergency room; heart exploding, brain bleeding and my Loud Mogambo Mouth (LMM) screaming in mortal fear and vowing bloody revenge for the price inflation that will surely follow such outrageous monetary inflation. Full Story
Gold is the one universal money, even more so than the dollar ever was. Massive trade deficit of United States is spewing out of vast quantities of green paper onto the world's markets. That action can only cause the global purchasing power of U.S. dollar to further depreciate over time. Investors around continue to swap those green pieces of paper for Gold. They have no choice. Supply of green dollars is growing faster than the global pile of shiny Gold. In that situation the only possibility is for the price of Gold to rise in dollar terms. Full Story
By: David Galland & The Daily Reckoning Crew - 6 February, 2007
-The biggest spending regime of all time...our Crash Alert flag is flying high... -Cinching up vs. loosening the family belt...don't mention the war... -The English and the French worship different gods...a smoker's reply...and more! Full Story
By: Axel Merk, Merk Hard Currency Fund - 6 February, 2007
The world is awash in money. This money has flown into all asset classes, from stocks to bonds, from real estate to commodities. In a world priced for perfection, should we enjoy the boom or prepare for a bust? Let us listen to Wall Street’s adage and “follow the money.” Full Story
There has been more talk in recent weeks on the subject of gold price manipulation. The purpose of this article is not to attempt to go into the details of whether or not there is manipulation, or how much there is, or who is doing it or why, because all of this is has been raked over by other writers in considerable detail. The purpose of this article is to examine what difference it makes to us as investors and traders, and how best to live with it. Full Story
They say that copper is the only metal with a PhD in economics, because it has such an excellent record in forecasting future business activity. Much has been made recently about Dr. Copper and his preliminary diagnosis of an impending recession, but what many don't realize is that the king of metals -- gold -- also has a PhD. However, if Copper's doctorate is in economics, Gold's expertise is more along the lines of philosophy, and his degree has been awarded by the world's oldest, most venerable of schools: the school of hard knocks. Full Story
By: Rick Ackerman, Rick's Picks - 6 February, 2007
We were offering shares of D.R. Horton short yesterday when the stock turned weak, denying us the fat pitch we’d hoped would start the day. Let’s keep at it, though, since there evidently are still a few bulls around to drive the stock higher once this pullback has run its course. How do we know there are bulls, even though the housing market is looking worse than it’s looked in more than 30 years? Full Story
By: The Mogambo Guru & The Daily Reckoning Crew - 5 February, 2007
-American savings rate as low as 73 years ago...how do you say 'bubble' in Mandarin...or Hindi? -Spending in a mixed welfare/warfare empire... penalized with miniscule interest rates... -Let's not let a little thing like thousands of angry Mexicans get in our way...wishing we had a George W. Caesar...and more! Full Story
Professor Piggington, a.k.a. my good friend Rich Toscano, recently teamed up with a San Diego money management shop called Pacific Capital Associates. Their new website features a well-reasoned explanation of why “cash” is no longer a risk-free investment, and Rich has kindly given permission for the article to appear here. Great job as usual, Rich. Full Story
1st Hour: * Encore program with economist, Dr. Marc Faber. If you'd like to be added to Chris's e-mail list, for each weeks ticker symbols and related information, please send a message to: goldseekradio@hughes.net 2nd Hour: * Investing Superbowl starring: Jim Rogers, Arch Crawford & Jim Letourneau. Full Story
There is a manpower crisis in the form of a skilled worker shortage that is having an adverse impact on the mining industry. Whatever one is interested in, be it gold, silver, platinum, uranium, base metals, or other mining operations, this situation is impacting on all forms of mining. It will influence the way investors view mining companies. Current mining operations will struggle to maintain production while new projects will be delayed. Full Story
Gold continues to act as a counter-cyclical barometer. Since the beginning of the year it has consistently outperformed economically sensitive commodities such as Oil and industrial metals. Supporting the case for an economic slowdown. But more importantly, Gold is responding to a widening of the yield curve. During the latest Bond Market malady, Long term rates have risen quicker than short term rates. Full Story
By: Rick Ackerman, Rick's Picks - 4 February, 2007
For those betting on a soft landing, Friday’s statistics were the stuff of wet dreams, so blissfully sub-par that you might think the U.S. economy was smoking opium. A slight uptick in joblessness and hourly earnings was gently offset by weak payroll numbers and a six-minute decrease in the average work week. All in all, it was a pretty mellow mix of yin and yang, considering there’s a housing bust under way that could implode the U.S. economy and cut global output in half. Full Story
Consumer spending is and always has been the backbone of the American economy. Our society encourages us to spend more and more every year. This is most evident during the all important Christmas season or should I say the “fourth quarter season.” Consumers are bombarded with advertisements, sales, and easy form of payment schedules. This has created a “buy now-pay later” attitude that has burdened the consumer with massive debt, and this mindset might push America’s consumption-based economy over the edge. Full Story
By: John Mauldin, Millenium Wave Advisors - 4 February, 2007
This week's letter is the text of the keynote speech I gave last night at the Raging Bull awards in Johannesburg. There are a number of awards given to the various mutual funds (called here a unit trust or a collective investment scheme) that had the best performance in their respective categories over the last 3-5 years. The winning funds had some very impressive performance indeed. It was a black tie dinner with about 400 attendees. It was one of the more elegant events I have attended in my life. Full Story
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