|18-08-2008, 01:04 PM||#21|
Join Date: Sep 2007
Jun 24, 2008 - 12:16 PM
It has been almost ten full months now since the Fed first lowered interest rates. If you remember at first there was a lot excitement over the Fed cuts. The DOW and Nasdaq rallied to new 52-week highs a few weeks after the first rate cut in September. The rally and promise of more Fed intervention for the market made many big name commentators extremely optimistic about the market.
But just a few weeks later the market turned lower and has been stuck in a bear market ever since. The banking problems multiplied and inflation skyrocketed with oil rising almost double in price now from where it was a year ago. The rate cuts tasted good at first, but are no longer palatable.
When thinking about the financial markets sometimes it is best to take stock of things before trying to look ahead and decide if you need to make changes to your portfolio or figure out where to look for the best investment opportunities. A lot can be learned about looking at where the market was a year ago and comparing it to today.
A year ago from today the DOW, S&P 500, and Nasdaq were all climbing higher. They had experienced a fast and furious correction that took the S&P 500 down over seven percent in February of 2007. The financial media blamed that quick correction on "credit worries," a fast drop in the dollar versus the yen, and a huge correction in the Chinese stock market. Rumors also circulated that some billion dollar Bear Stearns hedge funds were in trouble.
Over the next few months as the market went higher everyone thought that all of these problems were gone. Then the financial press started to focus on oil prices that were making new highs and the threat to inflation that they posed. In July the market peaked as talk intensified that the Fed might actually start to raise interest rates by the end of the year. Indeed Fed fund futures a year ago were pricing in rates hikes by the end of 2007.
Fed officials gave repeated speeches and statements that sounded hawkish on interest rates. At the same time though the drop in real estate prices started to pick up and the value in "subprime" mortgage securities went into collapse. Rumors abounded that several large hedge funds were in trouble.
The Fed publicly ignored all of this. At its August FOMC meeting they released a more hawkish statement on inflation to prepare the way to raise rates. The market dropped hard that day and James Cramer blasted the Federal Reserve and Ben Bernanke on TV for knowing "nothing." His statement was one of the most watched moments in financial TV reporting as people watched it millions of times on the Internet.
At that moment he was right. Within two weeks the market went into a mini-crash and the Federal Reserve lowered the discount rate in what looked like a panic move. The value of "subprime" securities went to zero. They are still being counted as "level three" assets on the balance sheets of some of the world's largest banks but in reality they are worthless and have been worthless since last August.
The Fed changed course 180% degrees in August and began to slash rates in September. It continued its rate cutting campaign and has lowered rates in the past ten months at the fastest rate than it ever has before in history - faster than it did even during the Great Depression.
Since then we have seen the "credit crisis" worsen. We have seen the economy slow down, real estate prices continue to drop, inflation explode, and the Fed print about 30 billion dollars and hand that money to JP Morgan so that it could buy Bear Stearns and prevent a potential systemic bank run.
What a roller coaster! And it ain't over yet folks. You can expect to see more volatility and the overall downward bias in the financial markets to continue the rest of the year.
What I want you to do right now though is think about the situation last year and how it compares with today. Just like in June of 2007, right now we can look back on this year and see a big correction behind us. Just like the correction in February of 2007, this one we saw in the first quarter was linked to credit problems and the unwinding of the real estate bubble. And just like then we have seen the market rally after that correction and lots of big name experts come out and declare the worst behind us. For instance Abby Cohen of Goldman Sachs claims that there is going to be a second half economic boom that will make the stock market rise much higher than it is now into the end of the year.
Things are certainly different right now than they were last year. The US is in a bear market right now whereas last year it was approaching the tail end of a cyclical bull market. That is a huge difference. But there is one important similarity that you need to focus on right now. At this time last year most people were worried about inflation and were expecting the Fed to raise rates by the end of 2007. Right now everyone is worried about inflation and the Fed has talked very hawkish about inflation over the past few weeks. Most of the talking heads are looking for the Fed to raise rates by the end of the year. This is exactly the same spot we were in this time last year!
But what if the economy doesn't pick up steam in the second half of the year and the stock market continues lower? What if more banking problems materialize? Bank stocks are making new 52-week lows and have been falling fast this month. They do not seem to be forecasting an end to the credit crunch. And really they shouldn't, because there is no sign of a bottom in real estate and all indicators I follow suggest that we won't see one into at least the second half of 2009.
I think we are likely to see a Fall shock hit the market. Last year we saw the Fed do a 180 degree turn from talking about inflation to cutting rates like a mad hatter. This year I believe we will see the Fed abandon its talk of fighting inflation to once again intervening to bail out some bank, patch up the leaky economy, or in response to a stock market mini-crash. I think the situation right now is like it was a year ago - everyone is worried about inflation, but the bigger problems lurk in the cooked books the banks are carrying. In fact we are more likely to see more problems emerge and the stock market go lower as that is the primary trend right now.
In essence the Fed is playing a game of poker. It is bluffing when it says it is fighting inflation. It has no chips left and has bet everything on the slim chance that the economy has already bottomed. If something happens to make the Fed intervene again then it will be faced with a choice of fighting inflation by raising rates, which would have the effect of blowing up the banking system, or intervening to save the banking system, the economy, and the stock market, which of course would mean more inflation, a falling dollar, and falling bond prices. The Fed has proven that if it gets trapped into such a corner it will side to help the banks and the stock market a stable currency be damned.
If this is what we see happen in the Fall then the Fed will lose all of its credibility when it comes to maintaining a stable currency.
What do you need to do? You need to do what you should always be doing - keeping your pulse on market trends to figure out the best way to position yourself to make money is. You can profit from any situation. Right now we have a bear market and that means using bear market strategies.
I will leave you with one last thought for today. In the past ten years every time the Fed has gone on a campaign of lowering interest rates it has create a "bubble". In 1998 the Fed lowered rates to bailout the Long-Term Capital Management Fund. When it did so it put excess money into the banking system. There was a lack of good investments for that money to go into so it flowed into Internet and tech stocks and formed a bubble. When that bubble burst the Fed lowered rates again to try to make the stock market go back up. As a result they dropped interest rates to an artificially low point, which created a housing bubble.
We are now suffering through the fallout of the housing bubble - the direct result is a recession, bear stock market, and "credit crisis" from banks who went nuts during the bubble.
Now remember - every time the Fed cuts rates it creates a bubble, because it puts excess money into the economy.
Well, the bubble now is now in commodities and oil. A direct result is inflation, a falling dollar, and eventually a bear market in bonds. There are opportunities to profit from this and I believe gold and precious metal stocks along with tactical short selling against he broad market and bonds will be the best way to go. If the Fed abandons this current inflation fighting talk this Fall I expect we'll see gold prices skyrocket into the end of the year.
Of course this is looking ahead and that isn't always an easy thing to do when it comes to the stock market. I can't say with certainty that this is going to happen. But I do know the technical signs in the market that will appear over the next two months if this is indeed what is going to happen and I know how I will position myself. The next eight weeks are going to be some of the most important we've ever seen in the financial markets. Not because of what will happen during these weeks, but to see how the markets are positioned once they are over. As any technical signs appear to point us the way I will draw your attention to them and explain to you exactly what they mean so that you can take advantage of anything that may happen too. From chaos comes opportunity and opportunity is another way to spell profits.
This article is an except from a WallStreetWindow subscription article. The full article contains more price projections of what I see happening for the S&P 500 and gold for the rest of the year. You need to subscribe to my free weekly newsletter to get all future articles. Just click here .
By Michael Swanson
Mike Swanson is the founder and chief editor of WallStreetWindow. He began investing and trading in 1997 and achieved a return in excess of 800% from 1997 to 2001. In 2002 he won second place in the 2002 Robbins Trading Contest and ran a hedge fund from 2003 to 2006 that generated a return of over 78% for its investors during that time frame. In 2005 out of 3,621 hedge funds tracked by HedgeFund.Net only 35 other funds had a better return that year. Mike holds a Masters Degree in history from the University of Virginia and has a knowledge of the history and political economy of the United States and the world financial markets. Besides writing about financial matters he is also working on a history of the state of Virginia. To subscribe to his free stock market newsletter click here .
Urgent Update: A Chat with Mr. Pucker
Jan 26 2008
OK, here's the word from Robin Landry - who at the moment might be called "Mr. Pucker":
"We have violated the 34-year trend line and now we are at the point at which the bearish count begins to take precedence. In other words, if the market can't recover and cross back up through the 34-year trend line, we're toast."
Many times the market will go back up and touch the trend line in what is commonly referred to as the 'kiss of death'. The very same thing happened in 1987. When I counted five waves down, and then an A-B-C rally to the bottom of the trend line.
That was the day I exited all my client's equity positions and that was five days before the 508-point down day, which was a 25% decline and today the action will be very closely watched.
If you see a rally, back up (and right now that trend line is somewhere around 11,781-82 on my computer - it will be different on others) then there is two levels to look at for hope.
We have passed the March low - the next low is the January low at 11,643. The low so far has been 11,645 - talk about testing the lows!
Now, so far, I still have a bullish divergence for the Dow. So the hope of the rally is not over ...yet. But, as I said earlier, the odds are beginning to swing toward the bearish outlook. So short term, it's 'do or die'.
If we break these levels, really the next support is down around 10,984, at which time the possibility of the bullish count being correct goes away. Simple as that - it would be the bearish count.
9,700 and then there's virtually nothing until 7,400."
So we all swallow hard and watch the tape... Landry's office number is 405-275-6162.
HEY FOLKS I'VE TAKEN A QUICK LOOK AND
I BELIEVE THE ECONOMY IS LIKELY TO BE
COLLAPSED IN WEEK 42 BEING
OCTOBER ON THE 18TH IN 2008
ALSO KEEP YOUR EYES ON THESE DATES:
JULY 12 - WEEK 28
AUGUST 06 - WEEK 32
AUGUST 30 - WEEK 35
PLEASE NOTE WE HAVE WEEK 42 = 4+2 = PERFECTION 6
THE SIX OF THE HEX. THE HEXAGRAM OF WITCHCRAFT.
THE HEXAGON ITSELF TURNED INTO A PERFECTION CUBE
BY WAY OF THE 7TH POINT (6X7=42 WEEK). REMEMBER
THAT THE 6 BECOMES A 9 REFLECTED BY ISIS WHICH IS
COMPLETION. NOTE HOW SATURN (EL) IS THE GOD OF
CHAOS, WAR AND DEATH. NOTE HOW THE 6, 8, 11, CUBE
AND SQUARE RELATE TO SATURN. NOTICE THE OCTOBER
BEING THE 8(OCT)BER. NOTE THE 10TH MONTH + 18 = 28.
28 BEING THE HOLY ANKH OF VENUS/LUCIFER. IF WE USE
THE 4 X 7 WE GET 28 WHILST 4+7 GIVES US 11 OF EL. NOW
WE HAVE THE 18TH ITSELF THE 6+6+6 9+9=1+8(9) 999
REVERSED 666 THE SQUARING OF THE 6 PERFECTION. THUS
WE HAVE A HEXAGRAM WITH ITS 6 POINTS, 6 TRIANGLES
AND 6 SIDES WITH THE INTERNAL HEXAGON. THE GREATEST
SYMBOL OF WITCHCRAFT. NOW REMEMBER THE HEXAGRAM
ON THE SEAL OF THE DOLLAR? NOTE THE LUCIFERIAN CIRCLE
AROUND IT? THE COMPLETION 9 COLLAPSE TO BRING ABOUT
THE NEW BANKING SYSTEM? THE HEXAGRAM IS THE
GENERATIVE PRINCIPLE FOLKS. THE SEXUAL UNION WHICH
BRINGS ABOUT TWO AS ONE BUT MORE IMPORTANTLY BRINGS
THE LEFT/RIGHT HEMISPHERES OF THE BRAIN TOGETHER AS
ONE DURING ORGASM. THUS A CONNECTION BETWEEN
CONSCIOUS AND SUBCONSCIOUS AS PROVEN BY WILHELM
REICH. REMEMBER HOW THE BRAIN IS CODED BY THE CUBE
OF PERFECTION. SO WE WILL SEE THE POWER OF THE
SCORPION ON THIS DAY AND HIS DEADLY KISS. THE SCORPION
IS LINKED TO THE MONTH OF NOVEMBER BEING 11 (EL).
Barclays warns of a financial storm as Federal Reserve's credibility crumbles
Last Updated: 12:30am BST 27/06/2008
US central bank accused of unleashing an inflation shock that will rock financial markets, reports Ambrose Evans-Pritchard
Barclays Capital has advised clients to batten down the hatches for a worldwide financial storm, warning that the US Federal Reserve has allowed the inflation genie out of the bottle and let its credibility fall "below zero".
"We're in a nasty environment," said Tim Bond, the bank's chief equity strategist. "There is an inflation shock underway. This is going to be very negative for financial assets. We are going into tortoise mood and are retreating into our shell. Investors will do well if they can preserve their wealth."
Barclays Capital said in its closely-watched Global Outlook that US headline inflation would hit 5.5pc by August and the Fed will have to raise interest rates six times by the end of next year to prevent a wage-spiral. If it hesitates, the bond markets will take matters into their own hands. "This is the first test for central banks in 30 years and they have fluffed it. They have zero credibility, and the Fed is negative if that's possible. It has lost all credibility," said Mr Bond.
The grim verdict on Ben Bernanke's Fed was underscored by the markets yesterday as the dollar fell against the euro following the bank's dovish policy statement on Wednesday. Traders said the Fed seemed to be rowing back from rate rises. The effect was to propel oil to $138 a barrel, confirming its role as a sort of "anti-dollar" and as a market reproach to Washington's easy-money policies.
The Fed's stimulus is being transmitted to the 45-odd countries linked to the dollar around world. The result is surging commodity prices. Global inflation has jumped from 3.2pc to 5pc over the last year. Mr Bond said the emerging world is now on the cusp of a serious crisis. "Inflation is out of control in Asia. Vietnam has already blown up. The policy response is to shoot the messenger, like the developed central banks in the late 1960s and 1970s," he said.
"They will have to slam on the brakes. There is going to be a deep global recession over the next three years as policy-makers try to get inflation back in the box."
Barclays Capital recommends outright "short" positions on Asian bonds, warning that yields could jump 200 to 300 basis points. The currencies of trade-deficit states like India should be sold. The US yield curve is likely to "steepen" with a vengeance, causing a bloodbath for bond holders.
David Woo, the bank's currency chief, said the Fed's policy of benign neglect towards the dollar had been stymied by oil, which is now eating deep into the country's standard of living. "The world has changed all of a sudden. The market is going to push the Fed into a tightening stance," he said.
The bank said the full damage from the global banking crisis would take another year to unfold. Rob McAdie, Barclays' credit strategist, said: "The core issues have not been addressed. We're still in a very large deleveraging cycle and we're seeing losses continue to mount. We think smaller banks will struggle to raise capital. We're very bearish - in the long-term - on high-yield debt. The default rate will reach 8pc to 9pc next year."
He said investors had taken their eye off the slow-motion disaster engulfing the US bond insurers or "monolines". Together these firms guarantee $170bn of structured credit and $1,000bn of US municipal bonds.
The two leaders - MBIA and Ambac - have already been downgraded as the rating agencies belatedly turn stringent. The risk is further downgrades could set off a fresh wave of bank troubles. "The creditworthiness of many US financial institutions will decline in coming months," he said.
The bank warned that engineering and auto firms we're likely to face a crunch as steel and oil costs surge. "Their business models will have to be substantially altered if they are going to survive," said Mr McAdie.
A small chorus of City bankers dissent from the view that inflation is the chief danger in the US and other rich OECD countries. The teams at Société Générale, Dresdner Kleinwort, and Banque AIG all warn that deflation may loom as housing markets crumble under record levels of household debt.
Bernard Connolly, global startegist at Banque AIG, said inflation targeting by central banks had become a "totemism that threatens to crush the world economy".
He said it would be madness to throw millions out of work by deflating part of the economy to offset a rise in imported fuel and food prices. Real wages are being squeezed by oil, come what may. It may be healthier for society to let it happen gently.
|18-08-2008, 01:07 PM||#22|
Join Date: Sep 2007
Don't get fooled into another Waterloo
Written by Andrew Winkler, The Rebel Media Group
Friday, 27 June 2008
When asking Western school children about the significance of Waterloo, the answer will be something along the lines of ‘the decisive battle between Napoleon and an English lead European coalition’. In fact, the future of the European continent was perceived to depend upon the battle of Waterloo. If Napoleon won, France would have been confirmed as the undisputed master of Europe. If Napoleon was beaten, England would have become the leading power in Europe and greatly expand its sphere of influence.
What Western school children are not taught - for obvious reasons - is the much bigger story behind the official narrative, the story of one of the biggest frauds in human history. Nathan Rothschild, the head of the English branch of the Rothschild crime family, took advantage of his advance knowledge of the outcome of the battle by tricking the London Stock Exchange into believing that Napoleon had won. The resulting crash of the Exchange enabled Nathan Rothschild’s agents to buy the entire London stock market for a Penny in the Pound and seize control of the Bank of England.
This shameless fraud was ruthlessly repeated in 1929. The private owners of the U.S. Federal Reserve, Rothschild subsidiaries J.P. Morgan, Citi Bank and Chase Manhattan Bank were awash with money earned by financing World War I. Using their market power, Rothschild’s agents first engineered an artificial boom in the stock market, tricking smaller banks and private investors into putting huge amounts of money into the stock market and then deliberately crashed it, enabling the Rotschild agents to buy most of the U.S. stock market. The ripple effect of the New York crash also enabled Rothschild agents in other countries, such as Germany, to buy local corporations at a fraction of their actual value.
Eighty years later, it looks like our ruling psychopaths are at it again. They are systematically destroying trust in the U.S. dollar, causing holders of large amounts of greenbags to sell them. At the same time, the Rothschilds are preventing the European Central Bank from printing sufficient Euros for U.S. Dollar owners to exchange all of their holdings into Euros. That way Dollar owners are forced to buy gold instead, causing the gold price to explode.
Simultaneously, the Rothschilds are using their influence on the media sector to spread rumours of an imminent crash of the U.S. Dollar and international stock markets. As per usual, in the day and age of infowar, those rumours first started in the alternative Internet based media, only to spread into the mainstream business media. Last week’s ‘global stock and credit market warning’ of the Rothschild owned Royal Bank of Scotland means that the next Waterloo must be imminent.
All it takes is a trigger such as a thwarted USraeli attack on Iran or the blocking of the Persian Gulf for oil transports, followed by a major stock sell-off by Rothschild agents. Once the world’s stock and credit markets have completely crashed, the price of an ounce of gold will be in the thousands, enabling the Rothschilds and other owners of large gold holdings to buy the market for a fraction of their true value.
$142 Oil is NOT the Really, Really Bad News...
27 Jun 2008
Now and then, this here web site has been called by various deniers of fact, a 'doom and gloom' site. The reason goes to the idea that "No one in their right mind would focus on 'worst case' outcomes unless they were a little crazy." If that's your opinion, your welcome to it, because the study of non-traditional economics I practice is no different that dozens of other professions, most of which are considerably more 'respectable'.
Take airline pilotry, just as a for instance. Do you want to be driven from point A to point B by someone operating at the precise limit of their abilities on a ceiling and visibility unrestricted (CAVU in hanger-talk) day? Is there a group of pilots that really train for the worst? You bet! They all do. I'd opt for the PIC (pilot in command) being an ex-fighter jockey turned sky bus driver who still gets up and wrings out a Citabria on weekends, or my person favorite, the A152 Cessna Aerobat, thanks.
Or, would you like to be operated on by a surgeon who was operating (on you) at the limits of his or her professional training, not knowing having any tricks up their sleeve in the event they "Ooops! Nicked an artery there, hemostat, please?" Again, even if it's minor surgery, I would take the doc who has 4-years of front line combat experience, or someone who's put 5-years in as a trauma doc in a high volume big city ER, over the "artiste" who is genius-level in specialty but lacks breadth and exposure to the worst of the worst-case possibilities. Stuff happens even, or maybe especially, in OR's.
Yet, somehow, when we get into the area of finance, and the now 11-year weather-eye this site has cast toward the storm clouds on the financial horizon, training for the worst somehow suddenly turns into a bad thing and I'm labeled an alarmist. (Nutjob is better, thanks)
Folks don't want to read the fine print that stocks and bonds can and do lose money, which you may have figured out by checking your account balances last week and today. And the few who read that don't want to believe or act on it. Go figure.
Several weeks ago in one of my subscriber Peoplenomics newsletters, I outlined a "worst case" view for readers. I opined that we should all be setting up contingency plans for Dow 7,400. I reiterated that my long-time broker friend Robin Landry had gotten his managed accounts out of stocks and into bonds or cash on the sidelines two months ago based on his market models.
I've even gone so far as to admit that Jas Jain is right about rolling into bonds, but he may have been early. Time will tell on that, especially if we get one last serious bounce before the MOAC arrives this fall. (The MOAC I refer to is the "mother of all crashes" if you dozed off during earlier reports).
With that in mind, I talked Monday after the close with Robin Landry about what he expects this morning - and going forward...
"I expect the market to open down this morning a hundred or so points, and then we'll really begin to tell if the panic is setting in and we're heading for the test of the 10,984 level, which as I said yesterday is the real level at which the bullish count fades away. That wouldn't preclude a bounce from some area down here from an overbought condition, but there would really be no support once we go through that 10,984 area until the 7,400.
There will be some little rallies but no meaningful things.
So my prayer is that we turn before we get there but as I tell everyone, I believe in God, but I'm not sure He worried about levels in the Dow Jones Industrial Average.
There's end of the quarter window dressing. This is the time that the 10 984 could get a really good test. "
Landry's view may be that of an optimist compared with a knowledgeable market player in Europe who has shared some outlooks with me from time to time. As this morning's headline suggests, his really, really bad news is that the worst case now brings a Dow under 2,000 into view. Yes, you read that right - the MOAC would have 7,400 as a bounce point on the way to the near 'death of stocks'...
Have you checked your 1929 overlay lately?
1:1 since Oct 10 in price % DJIA, not time but price. According to that we should get a "snapper" today...(one last one) so lets see...(wouldn't trade on it, but lets keep on the look-out- today was a bit much..
Laundry is right, if we don't revisit in fact there are only two more ref points:
11, 440 (for the big 5-7% bounce, we touched 11454 today and missed out on it on Bear Stearns day due do FED discount manip on 3/17)) see 1929... and 9,500 for an interim stop then 7300 -9,100/9200 and 7,400 again.
Your head will be spinning... back to 10,900 and see you at 1,618 there after (Dow that is not SPX)...
All this to be completed no later than new years eve 2009 (that would be the latest date) in fact, most if it might be done in a year...The only thing the FED (Ali and Ben) achieved is to mess around with the time window by first hiking (delay) into May 06 and then lowering (raising expectations) more delays since July 07. They are part of the problem and not the fixers that they make us believe.
After that we will have "Obama Air" and "Billary Banks", not their fault, but their only choice...communism wandered from Moscow to the US of A.
You also will see that there is no "PPT" cause they will be curiously absent...(never were there in the first place)...They always make noise when the pressure is greatest (just like journalists give people what they want to hear- they are part of the system/universe, not outside it, but the public doesn't get it, otherwise they would hang from the proverbial tree , and my hunch is that might well happen when the people see the emperors have no clothes:
Sample Soc Gen cut = end of wave 3 Bear sterns surprise = end of wave 5 (look at SPX its clearer than Dow) April cut = near the end of wave II big (ABC up) and yesterday no action = acceleration, the ammunition is gone - poof!
The bureaucrats listened to the siren calls of WS and shot all their powder on the credit crisis but that was only part one, what they forgot is that there will be a nasty century recession on top of the credit crisis... To mind comes Jordin Sparks' song: " NO AIR" ....to breathe..."
Oh, oh. One of the interpretations of the predictive linguistics that have reminded us that October 7th at 7:10 is the center point for an emotional event that seems to be largely economic in content - the MOAC kind of thing) is that 7,400 this summer, then a bounce and fall collapse scenario which could push the Dow under 2,000 would fit perfectly with the expectation of this European contributor.
Needless to say that with subscriptions open to the next predictive linguistics run from www.halfpasthuman.com ($240 for what's usually a 7-part 7-8 week run) we'll be watching closely as immediacy values build getting closer to the 'event' and share what we are allowed from the series.
One macro-level view: The reports have been labeling 2009 as the year of 'transformation'.
It doesn't take too many brain cells to figure that a Middle East Mistake, with resulting $500-$1,000 oil, and a Dow of 2,000 would do a fair bit of 'transforming'.
Social fallout of this approach to 'transformation'? Oh, yeah. I can almost see the Billy Bob Thornton character reading a year-end brokerage statement this fall and saying "Yep, yep, yep..." as he reaches for....
Bear with us: A Stock Mortem
POST MORTEM - From the Latin, after death.
STOCK MORTEM - From the Ureism, after the Friday close..
28 Jun 2008
"It could have been worse" is about the best face that can be put on it, and even that would take a couple of shots of Jack with a beer chaser to blurt out without choking up for most folks, especially among the nearly 'grays' who have bought into paper assets as a means of holding value long-term. A dodgy proposition, at best, as I've mentioned.
Wrong on much of his work, at least Marx got 'owning the means of production' right. This was not a good week for the sheep of cannibal capitalism...
Besides breaking a 34-year trend line from the 1970's (varies by who's doing the counting, but it's around there), the closing Dow of 11,346.51 compared with last Saturday morning's 11,842.69. That's just 3.82 points from being a 500-point loss for the week. Close enough for a Saturday morning chat.
The truth of the matter is there's a simple reason for this week's rout: More sellers than buyers, a condition exacerbated by the end of quarter jockeying as fund managers want to show something other than the truth of this year's performance. And that is?
On December 31, 2007, the Dow closed at 13,264.82, so if you're pushing calculator buttons and worried about your retirement plans going "Poof!", you ought to come up with a drop of 1,918.31 for the year-to-date. That's only a 14.46% decline in the Dow, but I should remind you (if I can with a straight face) that dividends by the Dow 30 would soften that a bit. You may have figured out that's about as useful as KY with a locomotive.
On the other hand, flipping over to the www.Kitco.com chart site, and not to rub salt around in it, but the close of the 'yellow dog' was $833.30 on December 31, 2007. That same chart set reveals 926.80, although they may be having an issue with updating. www.ino.com reports the last trade on August gold was at$930.90 or $931.30, depending if you wand 100 ounces from the CBOT with an August delivery, or a NYMEX August contract.
Even using the Kitco figures, lowest of the group and closest to spot, you'd be looking at an 11.2% gain for the year to date.
The Blame Game
The conventional wisdom - shunned around here - is that a bear market is a decline of 20% - and to be sure, this market is there,; it's a bear.
Recall the 52-week Dow high is showing as 14,280 and the requisite 20% off that would put the Dow around 11,424...and since the Dow closed well under that this week, you're probably wondering where headline writers are getting their gumption to refer to this as the "brink of bear market" as in the Bloomberg headline "U.S. stocks slump, Pushing Dow average to brink of bear market".
"Gee, George, Maybe they are talking about the S&P, or something..."
Yah think? Let's test that theory, shall we? 52-week high for the S&P 500: 1,576.09 so 20% off that would be...1260.87. Take a gold star...that's why it's not officially a 'Bear".
Think the market can lose 1.4% next week? Think McDonalds might serve a burger today?
End of quarter portfolio cleaning aside, what's at fault? Take your pick of the headlines:
"Credit scores hit by card limits"
":Libya's threat to cut oil sends out the jitters"
"Stocks slump on oil, earnings news"
"Consumer confidence nears all-time low"
On this last, it's the worst levels since April and May of 1980. But, maybe it was actually worse in the last Depression. They only started measuring in 1952.
Yes, the mortgage market has problems, yes oil is expensive, and yes, the dollar is still overpriced relative to the goods and services produced by America and traded with the rest of the world - especially if you drop out financial products from the mix. Might want to save some for paper mache, though.
Is there a long term fix and a way to get America back on a sound footing? Oh sure. Go to a real currency with direct convertibility, and I'm not talking gold and silver. This weekend for Peoplenomics.com subscribers I explain how a BTU-based currency, set initially based on purchasing power parity and featuring a deliverability attribute, would thin down the Fat Cat Bankster system in no time.
Delivery clauses honesty, and without it you end up with things like....oh, the ABX maybe?
We're in a world where BTU's are the most important underpinning of society, whether they come from oil, wind, solar, gas, or cord wood and food. A calorie or BTU-based currency system with absolute deliverability solves a lot of problems, unless of course, you live in Midtown and are a calorie sink. You might consider honest work, for a change...
Packaging financial product with a side order of carbon credits just perpetuates the banker class. What the world needs is honest trade and a BTU/caloric system with deliverability would thin down the banking model which has been on a Ponzi-like run for a long time - but more on this for subscribers.
More proof that BTU's rule? Oil hit over $142 this week.
Fortis is a large bank and insurer in the Netherlands and Belgium. It took over ABN Amro last year, together with RBS and another bank. Last Thursday, its share lost 17% because Fortis attracted foreign capital.
I was shocked when I read the following, which was brought out 4hours ago:
American 'meltdown' reason for money injection Fortis.
28th of June, 9:10
BRUSSEL/AMSTERDAM (DFT) - Fortis counts within some days up to weeks on complete collapsing the American financial markets. That explains interventions of Thursday to the serial according to the bank insurer to reinforce itself with €8 billion. „We are on the nippertje ready. It goes in the United States much more badly than thought, Fortis-chairman Maurice say lip paunch, which continues that top man Votron stays on. Fortis expect bankruptcies under 6000 American banks which have cover now little. „But also Citigroup, General engines, there start complete meltdown in the US. Fortis picked up yesterday €1,5 billion with aandelenemissie. End previous year had Belgisch-Nederlandse the concern €13 billion to new shares spend for the adoption of ABN AMRO, for which the €24 billion paid. lip paunch bases its care on conversations with bankers. „Two months suffered did not know we that it goes badly this way in America. And it still much will go more badly. We have to a thick mattress necessary the coming eighteen months pass when we can introduce ABN AMRO. Two weeks suffered communicated the American matter bank and consultant of Fortis Merrill Lynch that certain €6,2 billion extra to capital necessary were. THE VEB required yesterday clarification of Fortis: top man Jean-Paul Votron kept by the end of April full that Fortis did not need the capital market after purchase of ABN AMRO on. In a year €30 billion to grant value have been destroyed. After Votrons last consent the rate of the share with 19.4% plummeted, already it climbed yesterday with 4.4% up to €10,65. The enormous disorder around the bank insurer has especially stocked at our zuiderburen in Belgium as a bomb. Whereas the ophef sets limits in the Netherlands to the financial world, it is at our zuiderburen the conversation of the day. The bank not only dominates the street picture there, moreover but has been rockly-hard found by the mokerslag for Belgian volksaandeel hundred thousands small beleggers. All Belgian newspapers opened yesterday with heuse rampenkoppen, in which the free fall of the bank insurer became broad uitgemeten. Fortis crasht', calamity day for Fortis' and Fortis lose 5.3 miljard', this way opened three authoritative newspapers. The panic around the concern is concerning the border even this way large that the national supervision holder tried CFBA forced reassuring words speak itself direction the become desperate savers. „The need seizure of Fortis is run no reason to the bank and your money eraf CFBAwoordvoerder to obtain, thus. „Meet the bank all legal requirements, but themselves simply very sharp aims have put. Maurice lip paunch claimt that all large shareholders yesterday evening unanimously support to „has promised. Just like in the Netherlands the arrows aim especially at top man Jean-Paul Votron, who seems himself have strained oneself lifting heavily to the adoption of ABN AMRO. But whereas the inhabitant of brussels in the Netherlands is called its bonus of €2,5 million one requires pay in Belgium is departure. Which goes wrong such large, must carry the impact and therefore dismissal to take, thus President Huybregts of the Flemish federation of placement clubs and Beleggers. The fall of the share is for him an affirmative that the adoption of ABN AMRO much too expensive and was timed badly. „The former shareholders of ABN AMRO take a bath in champagne, emphasise Huybrechts now. „Which goes wrong large, must go away. Fortis are real volksaandeel and with that faith you can deal not recklessly. Also the Belgian newspaper the standard is rock-hard concerning the top man: „The credit crisis has met all banks, but it is no excuse. Fortis the much have decreased more sharply, thus commentator. „Fortis have always denied that there still a capital increase came. That was therefore or leugens, or inexperience. Both are just as terrible, thus Votron must keep the honour to themselves. He is some which something has deserved to the complete operation. According to the Belgian mediums want announce to Fortis Thursday that the bonus of Votron would be crossed out, but this has not happened at the last moment nevertheless. Also it is already very speculated concerning its succession, where especially the name of Filip Dierckx falls. Votron themselves want know of no districts. „The shareholders stand behind me and also in the top of the concern have I only support got operation set up for these by me, thus under fire located Fortis-topman. Also he rejects the terugstorten of the meanwhile controversial bonus resolutely. „What I do with my money, are my matter. The bonus had do nothing with ABN AMRO, but concerned the year 2007, thus Votron. The top man has been, however, prepared receive a part of its salary in Fortis-stukken. Moreover Votron can count still complete on chairman lip paunch, which denies that the bank has himself on the adoption of ABN AMRO verkeken. „Votron the top man remains simply. At this moment intervene, which is difficult that is real leadership show.
Faber: Federal Reserve Could Fail
His chortles at the CNBC bozos were great.
PART 1 OF 2:
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PART 2 OF 2:
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|18-08-2008, 01:10 PM||#23|
Join Date: Sep 2007
British Israel World Federation Movement's Destiny Magazine, February 1941 issue, page 31
The June 2008 Dow Crash and the coming first strike attack on Iran herald the end of dollar hegemony.
They say that pictures speak a thousand words, so let’s start this with a picture:
Today, the Dow crashed through its eight-year support level at 11,750. There isn’t much below now to keep it from dropping all the way back down to the 7,500-range. What that will do to American investor psychology and worse, consumer confidence, and therefore spending, and therefore the economy, is only too apparent.
The gold-attack on Monday obviously didn’t take. Gold recovered the following day and powered up by $26 the very next day to close in NY at $911. On Friday, gold confirmed its breakout, which means there will be little holding it back - just like there is now very little that’s holding the Dow up.
Unsurprisingly, the US war machinery is in full swing at this time. Troop and military asset movements into the Iranian theater are nearly complete, the Israelis have flown their practice-attack of 100-plus fighter jets over the Mediterranean, and Congress has again prostrated itself before its banking-guild rulers who want total government (and therefore banking) of all economic activity.
Congress did this by passing the FISA Amendments Act of 2008 to give retroactive immunity to telcoms spying for the government, and by proposing a resolution (the already infamous H. Con. Res. 362) by which Congress demands that Bush completely blockade Iran in order to force it to stop enriching uranium. This, naturally, is a perfect setup for unleashing the long-planned bombing campaign on Iran. Congressmen know that Iran will not accede to these international demands.
End result: We will probably get another war because of all this, just like we got one back in 2002-03 when the Dow plunged into the chasm this recently broken support level has bridged for these past eight years (see chart above).
The problem is that this time, it is a bipartisan gang of US war mongers in our Congress who all appear hell-bent on forcing Bush to attack Iran with a preemptive strike, possibly even an unprovoked nuclear first strike – something that human history so far has not had to deal with.
It is also something that will cause the US to forfeit any legitimate claims of world leadership for the remainder of that history.
The War Currency
Wars are rarely fought over national security issues, as political leaders often claim. At rock bottom, they are mostly fought over economic issues.
Iraq and Iran (if Congress and the administration get their way) are the only two countries the US has ever attacked preemptively. They are also the only two oil-producing countries that ever went off the petrodollar. The alleged nuclear ambitions of a terrorist-sponsoring country cannot be the real reason for the planned attack – because terrorist-sponsor North Korea was not only allowed to develop nuclear weapons unmolested, it was even allowed to test-launch a potentially nuclear-tipped ICBM at the US without any military repercussions whatsoever.
There goes the "national security" rationalization for this planned attack.
This fact exposes the attacks for what they really are. tools of US monetary policy. The dollar has no real value internationally, save for the fact that the now militarily enforced necessity for countries to buy dollars in order to buy oil creates artificial demand.
The euro’s existence threatens all of this, now. Oil countries have a dollar-alternative in the euro, and so does the rest of the world. The euro is designed to not be quite as inflationary as the dollar is and has been. This is done by virtue of the ECB’s exclusive mandate of "price stability", another word for inflation fighting.
Yet Another War Currency
Yet, even the euro carries the fiat-disease within it. Even the euro is structurally inflationary – just at a slower pace than th edollar. Ultimately, even the euro will fail, but it has served its intended purpose well: to sideline the US dollar and thereby the dollar-based US empire.
The old US dollar empire has now served its own purpose as the engine for global growth and for achieving general globalization. Like the Jumbo Jets of yore that piggy-backed the early space shuttles perform their test flights before they could finally launch into space on their own power, the US economic mother ship has now fulfilled its purpose and is no longer needed.
In the globalists' view, the US can now safely be discarded because it has inherent "flaws."
America has a constitutional system that, even though it has been successfully neutralized to a large extent, was designed to protect individual freedom, and that makes some of her people insist on them. Such cannot be tolerated in a truly globalized world. It tends to make people of other countries want to simulate the US and to insist on keeping their countries’ sovereignty intact to protect their own tenuous freedoms.
In the final analysis, therefore, the euro is a war currency as well. It is a model currency, designed to centralize economic power in artificial, regional political bodies and away from sovereign national governments. It is a currency designed to abolish the nation state. It serves as the model to be implemented by other regions: North America next, then Asia and Africa, later North and South America combined, and eventually all of these regions will be forced to bow to a supra-regional, global control mechanism.
This will only achieved by more warfare – except it won’t be called "war" anymore. Future military campaigns will be called "peace actions", for they will ostensibly be waged to "enforce peace" – a linguistic and conceptual contortion that rivals anything George Orwell could have dreamed up.
The Peace Currency
Gold is truly the peace currency. It needs no military to prop it up. It needs no centralized control system to regulate its supply, only the natural, ultimately decentralized controls of supply and demand. Wars may be fought over access to gold mines some day, but correct me if I’m wrong, so far this has not happened in history. Gold can easily be acquired in trade. Fighting a war over access would be self-defeating because it costs more than the potential benefit could yield.
So, the world is now faced by an America that claims it wants to "spread democracy" while using its military to tyrannize countries that simply want to sell their oil for another currency. America has become what she always claims to be opposed to: an absolute tyranny that no longer even cloaks itself. Not surprising, given the role assigned to her by her globalist masters in ushering in the preconditions for eventual total centralization.
Gold is allowed to play its limited role in all of this because increased use of gold for investment purposes, and as currency, tends to weaken the dollar-empire and strengthen other regions (Europe), and nations (China).
Americans, however, have it within their power to mess up the globalist’s game plan for good. They have a chance to completely neutralize the eventual "winner" of the globalists’ remaining, hand-picked presidential candidates. They have a chance to boot out every Congressman and Senator up for reelection this fall who ever voted to pass measures such as the “Patriot” Act, the Military Commissions Act, or the upcoming vote on House Concurrent Resolution 362 discussed above.
They can also fire all who refuse to vote for Ron Paul’s Honest Money Act designed to reintroduce gold and silver as the peace currency.
If they achieve this victory, Congress will, for once, pay attention to their political will. Congress will then, for once, be a true check on presidential executive power. Such a Congress can then even be moved to abolish the Federal Reserve – but only if Americans start to pay attention to what power their choice of currency can convey to – or withhold from – their government.
It’s all up to them.
In the meantime, gold will have unbelievable bull runs as the US Fed carries out Vladimir Lenin’s instructions on how to “best” destroy the capitalist system – by debauching the currency.
Global economy faces deep slowdown, warns central bankers' club
By Edmund Conway, Economics Editor
Last Updated: 1:19am BST 30/06/2008
The global economy may be heading for a far deeper crisis than is expected and a bout of deflation in the world's biggest economies is now a possibility, according to one of the world's most highly regarded economic institutions.
The Bank for International Settlements has warned that many in the City and elsewhere may have underestimated the scale of the coming economic downturn in one of its most sombre portraits yet of the international financial system.
The Swiss institution - known as the central bankers' bank - issued the alert in its annual report, released today.
It warned that the sub-prime crisis in financial markets was merely a reflection of growing debt burdens in the developed world, which could soon contribute to a deep slowdown.
"The difficulties in the sub-prime market were a trigger for, rather than a cause of, all the disruptive events that have followed," it said. "Moreover... the magnitude of the problems yet to be faced could be much greater than many now perceive."
The warning will cause particular concern among participants in the financial sector, as the BIS was among the earliest major institutions to warn that the world could face a credit crisis and financial slump.
The report draws stark comparisons between the current crisis and a variety of others including the Great Depression.
It said: "Historians would recall the long recession beginning in 1873, the global downturn that began in the late 1920s, and the Japanese and Asian crises of the early and late 1990s respectively.
" In each episode, a long period of strong credit growth coincided with an increasingly euphoric upturn in both the real economy and financial markets, followed by an unexpected crisis and extended downturn.
"In virtually every instance, some form of new economic discovery or new financial development provided a further 'new era' justification for rapid credit expansion, and predictably became a focus for blame in the downturn."
Most sobering is the report's warning that developed economies including the US and Britain could face deflation.
It said: "The eventual global slowdown could prove to be much greater and longer lasting than would be required to keep inflation under control. This could potentially even lead to deflation, which would evidently be less welcome."
•Profitability in financial services is falling at its fastest rate in at least 19 years as the credit crisis continues to hurt, a new study indicates. A balance of 44pc of firms have reported a fall in profits in the quarterly financial services survey released today by the CBI and PricewaterhouseCoopers. It is the worst result since the survey began in 1989.
US Mint Suspends Gold Coin Sales
Submitted by cpowell
Dear Friend of GATA and Gold:
The U.S. Mint has suspended sales of American Eagle gold coins and is refusing orders from dealers, two coin and bullion dealers confirmed Thursday.
The mint's suspension of gold coin sales follows its tight rationing of sales of silver eagle coins, begun in May, when sales to the public were terminated and sales to the mint's 13 authorized dealers were tightly limited.
Word of the mint's suspension of gold coin sales came from the American Precious Metals Exchange in Edmond, Oklahoma, (<http://apmexdealer.blogspot.com/2008...es-of.htmlhttp
://apmexdealer.blogspot.com/2008/08/news-alert-us-mint-suspends-sales-of.html) and from Centennial Precious Metals in Denver, Colorado.
The suspension is overwhelming evidence that the futures contract price of gold on the commodities exchanges is substantially below the physical market price and that, indeed, the commodities exchanges are being used as GATA long has maintained -- as part of a massive scheme of manipulation of the precious metals, currency, and bond markets.
Michael Kosares, proprietor of Centennial Precious Metals and host of its Internet bulletin board, the USAGold Forum
(<http://www.usagold.com/cpmforum /http://www.usagold.com/cpmforum/), explained Thursday:
"The U.S. Mint buys direct from the refiners, and this suspension of gold eagle sales may be an indication that the supply line is already backing up, or that the mint expects that it will back up for the rest of the year. I wonder who would give up physical metal at these prices and under these circumstances except distressed sellers. The central banks are in a hunker-down mode as far as I can determine, and it's the mines that supply the refiners. So if the mint, which buys from the refiners, is having a difficult time locating metal, what does that tell you? I keep saying that we may get a surprising rubber-band effect later in the year when the pre-holiday/festival season kicks off in September/October. It may happen sooner. One of our indicators of approaching a bottom in gold is how many calls Centennial Precious Metals gets from our U.S.-based Indian clientele. Here's a quote from my office's report to me at the end of the day today: 'Today was a good day. ... There must have been an Indian convention where someone was handing out USAGold business cards.' That may give you a clue as to thinking in India proper and probably the rest of the Asian rim."
That is, through their agents the bullion banks the Western central banks, desperate to prop up a corrupt and totteringt financial system, have put gold so much on sale that even the U.S. Mint can't find any now. The price reported from the commodities markets is a fiction -- a scary one, perhaps, but a fiction no less.
You can strike a blow at the market riggers who are defrauding the world -- just buy a little real metal The dealers listed at the bottom right of this dispatch will be glad to help you do it.
CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc.
* * *
Here is a grasp of interesting and relevant quotes coming from a document from a British Defence think-tank called the Development, Concepts and Doctrine Centre (DCDC) which predicts what general societal changes will take place over the next 30 years or so:
Source: DCDC Global Strategic Trends Programme 2007-2036
Or download directly from:
If an economic meltdown will indeed become a reality then it is likely that through the ensuing shock-wave engulfing society, chaos will not only manifest itself in rises in crime and unemployment, the general hygiene is also likely to plummet. Now this would in my opinion be an excellent staging base for our leaders to release biological weaponry on the public. After all, they then could always simply blame poor standards of hygiene for any sudden devastation brought on the populace caused by epidemics of infectious diseases. No terrorists needed, just blaming the degenerate and sorry state of society will do just nicely thank you.
As such, they then have a seemingly ideal explanation for any drops in population numbers without the need for resorting to the actions of foreign based terroristic agents, which after all may relatively easily be flagged as being insidious cases of false flag terrorism imposed by local governments themselves.
We, the so-called 'useless eaters' (then: 'useless eaters gone wild' through hunger, discontempt and disease) then face extinction seemingly entirely through 'natural' means; no war and no foreign terrorists needed.
|18-08-2008, 04:17 PM||#24|
Join Date: May 2008
Location: nr. York [UK]
these first three pages in pdf just in case it 'get's lost' again or someone wants to read it offline.
"You can’t trust freedom when it’s not in your hand" [G'n'R]
I'm interested in anything about revolt, disorder, chaos, especially activity that appears to have no meaning. It seems to me to be the road toward freedom.
|18-08-2008, 09:58 PM||#26|
Join Date: Jul 2008
I found the comments on page 1 of this lengthy document (Breaking News....Global collapse Sept. 2008) extremely offensive, and blatantly racist. The references made to the Jews, Blacks, & Hispanics are disgraceful. Unfortunately such remarks only serve to take away from the seriousness of the main subject.
I forwarded the page to some friends/family for their info, & go blasted by one individual for sending out what he considered "hate mail". In part he is write about the hate part, but I didn't write the article, & these opinions are certainly not mine.
Personally I question whether that kind of material should be on this website. I believe these type of racist opinions only serves to manifest more hatred, more violence, in an already violent world. I am truly saddened by this article.
Thanks moderator" offensive remarks have now been removed!
Last edited by simplify; 19-08-2008 at 01:56 AM.
|18-08-2008, 11:21 PM||#27|
Join Date: Jan 2007
Location: Reno, NV
How cliche. The guy is salivating at the mouth regarding the opportunity to use his firearms on people. I grew out of that phase when I was like 20.
It's all the same shit. Yeah, anarchy will eventually take place for one reason or another, but these guys who write about it are so annoying.