Tuesday, December 28, 2010

Reindeer Games

I've run out of important things to say in 2010!!

Saturday, December 25, 2010

Merry Christmas

Merry Christmas to all!!



The only time that Linus ever drops his blanket!

Monday, December 20, 2010

Normality & Linear Thinking

"The mainstream linear thinkers see a recovery and a return to their concept of normality. They will be shocked and flabbergasted when they realize that this is only the beginning of a 20 year period of turmoil, chaos and war. It seems that some study of history would benefit the mainstream talking media heads pretending to know what is happening and political hacks in Washington D.C. who pretend to administer the affairs of state. The cycles of history are not identical, but the alignment of generations is always the same."
James Quinn, The Burning Platform

Friday, December 17, 2010

Shoot More Bad Guys

"Pentagon shifting Afghanistan war strategy to 'shoot more bad guys'? White House review of Afghanistan war strategy finds progress, but at the Pentagon support is growing for a shift toward more hard power."
Source: Christian Science Monitor

Don't forget the "real story":
http://randomroving.blogspot.com/2009/11/truth-about-afghanistan.html

"The imperialistic invasions of Afghanistan and Iraq engaged the U.S. military and temporarily aroused the patriotic spirit in America. I'm not quite clear why bombing other human beings makes us feel patriotic, but the America flags were flying high. Today, many question our continued presence, yet fear is alive and well."

Random Roving, May 29, 2009

Thursday, December 16, 2010

A Golden Christmas

This one might "take the cake"!

"An Abu Dhabi hotel unveiled a jewel-encrusted Christmas tree today worth more than $11 million. How's that for bling?  It is the "most expensive Christmas tree ever," said Hans Olbertz, general manager of Emirates Palace hotel, according to Agence-France Presse. The tree stands 40 feet tall and is decorated with silver and gold bows, ball-shaped ornaments and white lights.  Its branches are draped with 181 diamonds, pearls, emeralds, sapphires and other previous stones."
Source: Daily Finance

Wednesday, December 15, 2010

A Gold Alternative

An altnerative to investing in gold!

"Las Vegas Police Department have released footage of a man running through the Bellagio after stealing $1.5 million (£945,700) worth of casino chips. Police say an armed man wearing a jumpsuit and a motorcycle helmet with white stripes walked into the Bellagio hotel and casino complex in Las Vegas, robbed a betting table then fled on a motorcycle early on Tuesday."


Thursday, December 9, 2010

Wednesday, December 8, 2010

Derivatives & The Blob

I was flipping channels over the Thanksgiving holiday and stumbled upon the movie classic, "The Blob".  I had forgotten that this 1958 horror classic starred Steve McQueen.  I remember as a kid that this was the ultimate scary movie.  "The blob eats you alive!".

Reading an article on Bloomberg last night regarding financial derivatives reminded me of The Blob.  It just oozes along devouring everything in its path.  In the end, they froze The Blob and sent it to the Arctic for a permanent freeze.  How are we going to "freeze" these instruments that Buffet described as "weapons of mass destruction"?

"Global derivatives trading in over- the-counter and exchange-traded futures and options will represent a $700 trillion market with $3.7 quadrillion in annual turnover by the end of this year, research company TABB Group said.  Rules to have central clearing for over-the-counter trading would require additional collateral of as much as $2.2 trillion, Westborough, Massachusetts-based TABB said in a statement on its website, citing a report it completed at the request of the World Federation of Exchanges."
Source: Bloomberg

"The 'derivative monster' still lurks in these financial waters. Every contraction cycle needs a culprit. Derivatives will be the blame for this one."
Random Roving, July 3, 2010
 
"Puplava's risk comments are targeted at the significant amount of derivatives in the world.  His argument is that the risk can NOT be taken out. Many on Wall Street believe that great mathematical models can remove the risk. For a more thorough understanding of the crisis evolving...."             http://www.financialsense.com/series2/rogue.htm

Random Roving, March 27, 2003 (email era)

Saturday, December 4, 2010

Precious Metals Defined

"The most liquid, tangible, fungible, recognizable, coveted, time-tested, and easily-converted-to-something-else assets are precious metals."

Jerry Western, Financial Article Summaries Today, Editor and Author

Friday, December 3, 2010

Thursday, December 2, 2010

Uranium You Say?

It might be some time to invest in some uranium. A new ETF (symbol URA) provides an easy option.

Uranium price (Source: Bloomberg)

Tuesday, November 30, 2010

Hot Potatoes & Risk Transfers

"Bailouts for Ireland and Greece and speculation that Portugal and Spain may need aid are prompting investors to shun some of Europe’s highest-rated bonds. The cost of insuring German debt against default rose yesterday to the highest since May. The yield on 10-year French securities climbed to as much as 3.247 percent, the most in more than in six months, and the extra yield, or spread, investors demand to hold 10-year Belgian bonds instead of similar-maturity German bunds climbed to the most since at least 1993. More rescuing means a bigger bill for everyone and this partly explains the pressure on yields in some countries, including Germany,' said Elwin de Groot, a senior market economist at Rabobank Groep in Utrecht, Netherlands. 'Now we have the deal with Ireland, there’s speculation about whether we should rescue Portugal or even Spain after that. That’s creating an environment in which there’s going to be risk transfers.'"
Source: Bloomberg

"We are moving apart. Organizations like the European Union are in the process of "fragmenting". During an upward trending mass social mood, we make peace and sign peace treaties. We form cooperative organizations during these times and merge currencies. Now, the tide has shifted. Keep an eye on the EU. As Greece, Spain, and others continue to feel "the pain", their partners in the EU will continue to ask 'why are we being dragged down by them?'."

Random Roving, March 30, 2010

Sunday, November 28, 2010

Religious Bankruptcy

"Crystal Cathedral officials say their financial woes were brought on by the recession. More than 550 creditors are owed $50 to $100 million, according to bankruptcy documents filed last month.  But insiders and religious experts say the situation is more complicated, and stems from how to best preserve founder Robert H.'s legacy.  The Crystal Cathedral has been battered in recent years as attendance has declined along with donations. That has brought cuts that some believe have reduced the quality of the church's programming and productions.  At the same time, the church has been roiled by family discord that included the very public firing of Robert Anthony Schuller, who had long been seen as the founder's successor, and the ascension of Robert H.'s eldest daughter, Sheila Schuller Coleman, to the top job.  The church kept expanding, and the spectacular 10,000-pane Crystal Cathedral was dedicated in 1980. "The Glory of Christmas," an extravagant holiday production that attracted thousands, began in 1981. Soon after, the church added an Easter show.  The Christmas production would begin to signify a culture of extravagance within the church: More than a dozen angels in white chiffon flew overhead, professional singers replaced volunteers, and live camels and donkeys took the stage.  "You felt like you were sitting in the middle of a symphony orchestra," said Conwell S. Worthington, who directed the Christmas and Easter pageants from 1983 to 1986"
Source: LA Times

"Religion will become smaller, 'deeper', and more traditional. The megachurch and megamillionaire ministers might have seen "the peak". Hopefully they saved all of those millions from the book deals."
Random Roving, January 1, 2010

Saturday, November 27, 2010

The Brazilian Onion

Brazil as a country has been doing extremely well the last few years.  It appears that not all people participated in that growth.  Remember the "peeling onion" theory?  "The weakest fall first with more to follow. The onion gets peeled back one layer of a time."

"Brazilian police in Rio de Janeiro say they have taken control of the Vila Cruzeiro slum after five days of violence that left at least 23 people dead.  Authorities say military armored vehicles carried the hundreds of officers into the slum, as gunmen fled into nearby shantytowns. Federal security forces are expected to move into the slum Friday.  Officials say 30 vehicles were burned in the violence leading up to the the police takeover. Brazil is trying to seize control of Rio's slums from drug gangs as it prepares to stage the 2014 soccer World Cup and the 2016 Summer Olympics. As part of the crackdown, more than 150 people have been arrested in raids on Rio slums.  The city of 6 million has high crime and murder rates. Heavily armed drug trafficking gangs control many of Rio's poor areas, making the city among the most violent in Latin America."
Source: VOA News

Friday, November 26, 2010

Unthinkable. Really??

"Contagion spreads from Ireland to Portugal and then to Spain, forcing European leaders to exhaust the $1 trillion bailout fund they set up only half a year ago to defend their ambitious single currency project.  Sniping within the 16-nation euro zone mounts and popular support for the euro erodes as German taxpayers rebel against a series of costly rescues and austerity fatigue in the bloc's periphery reaches breaking point.  Eventually one or more countries decide enough is enough and break away or are forced out, reintroducing the national currencies they used before tying their fate to Europe's audacious economic and monetary union.  Unthinkable only a few weeks ago, a small but growing number of experts now believe some version of this nightmare scenario could become a reality for the euro zone if policymakers fail to unite behind a more forceful strategy for saving the euro and address investor concerns about fiscal and economic imbalances."
Source: Reuters

Unthinkable only a few weeks ago??  Really???

"We are moving apart. Organizations like the European Union are in the process of "fragmenting". During an upward trending mass social mood, we make peace and sign peace treaties. We form cooperative organizations during these times and merge currencies. Now, the tide has shifted. Keep an eye on the EU. As Greece, Spain, and others continue to feel "the pain", their partners in the EU will continue to ask "why are we being dragged down by them?"."
Random Roving, March 30, 2010

Wednesday, November 24, 2010

I Want My MTV - Part Deux

It was almost a year ago to the week that I made this post:
"College campuses appear to be heating up worldwide. First UCLA, now Iran. We have a generation of kids waking up to the reality that their parents have not only indebted them for life, but also destroyed their current job market and prospects. Kent State might end up looking like a mild one when this one peaks."

Random Roving, December 12, 2009, "I Want My MTV"

Those British kids are setting the pace for the millennials across the world.

Tuesday, November 23, 2010

Korean Games Continue

"26-year-old dictator-in-waiting has burnished his leadership credentials with a deadly artillery attack on South Korean territory, causing its neighbour to return fire and scramble F-16 fighters. Two South Korean marines died, and at least 12 were wounded. There were reports of civilian injuries and houses were set ablaze as scores of shells fell on Yeonpyeong island.  A North Korea expert at Beijing's Central Party School, Zhang Liangui, told the Herald that Kim Jong-un was deliberately destabilising the environment in order to mobilise the military and consolidate his power."
Source: The Sydney Morning Herald

"Rekindle, reignite...it's all the same thing. My prediction on this one was that when the tide lowers, it's easy to pick a fight with an old foe. It usually takes a small spark."
Random Roving, March 8, 2009

Monday, November 22, 2010

The Stampeding Herd

Beware of the stampeding herd!

"Thousands of people stampeded during a festival in the Cambodian capital, leaving at least 349 dead and hundreds injured in what the prime minister called the country's biggest tragedy since the 1970s reign of terror by the Khmer Rouge. A panic-stricken crowd - celebrating the end of the rainy season on an island in a river - tried to flee over a bridge and many people were crushed underfoot or fell over its sides into the water. Disoriented victims struggled to find an escape hatch through the human mass, pushing their way in every direction. After the stampede, bodies were stacked upon bodies on the bridge as rescuers swarmed the area."SOURCE: The Washington Post

Thursday, November 18, 2010

Everybody Wake Up

EVERYBODY WAKE UP (OUR FINEST HOUR ARRIVES) - The Dave Matthews Band
Everybody wake up
If your living with your eyes closed
See the man with a bomb in his hand
Everybody wake up

Oh baby it's not easy sometimes
They build these walls ever higher and hide behind them
Seems an odd way to try and make things right
Oh I feel like I go crazy sometimes

Our finest hour arrives
See the pig dressed in his finest fine
The believers stand behind him and smile
As the day lights up with fire

Everybody wake up
If your living with your eyes closed
See the man with a bomb in his hand
Everybody wake up

I Remember the words of the misguided fool
Do unto others as you'd have them do
Not an eye for an eye is the golden rule
Just leaves a room full of blind men

And the finest hour arrives
See the pig dressed in his finest fine
Don't believe him leave and stand behind him and smile
As the day lights up with fire

Everybody wake up [etc]....

Everybody wake up
if your living with your eyes closed
see the man with a bomb in his hand
Everybody wake up

Monday, November 15, 2010

A Little Picadilly Circus

Those British students keep getting rowdy.

"Student activists have called for further mass civil disobedience targeting the coalition Government, following last week's occupation of the Conservative headquarters."

Source: SkyNews

"Protests and riots will continue to increase across the world. The mob is getting angrier and angrier. College campuses will continue to "heat up". The younger generation is awaking to the fact that their parents squandered their future. 'Mom and dad, thanks for the debt burden!'"
Random Roving, January 1, 2010

Sunday, November 14, 2010

Happy Sailing

Just read this quote and really liked it.

“If you want to launch big ships, you must go where the water is deep.”
Conrad Hilton

Thursday, November 11, 2010

Criminals, Dynamite, and Heroin Injections

"Apparently the criminals who run these trading operations are willing to put it all on red that the Fed will never respond to the runaway in commodities and its stranguflation effects. My sense is that they have strapped dynamite to themselves and are daring the Fed to act. I don’t even pretend to know or even guess as the cluelessness of pumping up a stranguflationary hurricane, so the key is to focus on real economic effects, which are horrifically negative. That way I don’t really have to wait with baited breath for every Fed heroin injection into the patient or protestations from financial gangsters, I just know the patient is dying."

Russ Winter, Wall Street Examiner

Friday, November 5, 2010

Stealth Gold Bull Market

"Great bull markets are seen maybe once or twice in a lifetime. The current 'stealth' gold bull market has sneaked up on most Americans. The very phrase, 'gold bull market' is sneered at by most analysts today. In fact, most of the comments on gold today come in the form of warnings; 'Gold is too high.' 'Gold is in a bubble.' 'Gold will sink back below 1000.' 'Gold is a fool's play.'  Nonsense. Gold is moving ever-closer to it's climactic speculative third phase. The negative comments about gold will only serve to make the gold bull market that much stronger. In this business, there is nothing more powerful than a primary bull market that has been denigrated, spat at, and held back for years."
Richard Russell

Wonderful Thing

It's official.  The QE2 has left the port and so far she's sailing with a full passenger list. Captain Bernanke is at the helm!  Steward Obama is hoping that the passengers are hungry!

I had the pleasure of experiencing QE2 live last night as I was buying a car.  When I finally made it to the finance office to cut the check, the dealership employee was begging me to not pay cash.  "Mr. Barrell, do you realize how cheap credit is right now?  You'll never find cheaper money."  And I replied, "I know, but debt is not a good thing anymore."  He looked at me with great confusion.  The Kool Aid party resumes and many will be suckered in to adding more to their debt load.  Haven't we just decided to add "fuel to the fire"?  If your house is burning, you don't soak it in more kerosen do you?  The personal savings rate across the country has been on the rise, we'll see if this next round of "free money" doesn't drive it back to negative numbers.

"Wonderful thing, wireless, isn’t it?"
Captain Arthur Rostron, to Second Officer James Bisset, on the Titantic having told him the latest news on the known positions of icebergs. This was at around 10:00 p.m., April 14th, 1912.


Thursday, November 4, 2010

Giving Up Power

"The most common way people give up their power is by thinking they don't have any."
Alice Walker

Some Mary Kay Perspective

David Galland, the Managing Director at Casey Research, summed up the election as below. I wish my "cliff notes" from yesterday's post were as good.

Dear Readers,
One of the most memorable lines I’ve ever heard, I heard while standing in line at a kid’s store in a nearby town.  Even though short, the checkout line had ground to a halt thanks to an irate woman blocking further progress. “She said I could put it there!” she nearly shouted, her face red.  “I’m very sorry, ma’am, but she didn’t have authority to let you do that,” politely explained the man whom I recognized from previous visits as the proprietor of the well-run store.  “Well, then why did she say I could put it there!?!” she asked angrily, stabbing a finger accusingly at a blank space on the checkout counter.  “It was a mistake on her part,” the owner answered patiently. “This is a place of business – my business – and we can’t just let anyone who wants to put things on our checkout counter.”  Casting upon him a steely glare she growled, “Okay, fine! Then just give me my box back!”  With the line still stopped and his customers, me included, looking on, the shop’s owner rummaged around beneath the counter in search of the missing box. Thanks to continued muttering by the angry roadblock, it quickly became apparent that the box in question was meant to harvest business cards from anyone interested in a free makeover from Mary Kay cosmetics. It also became apparent that the box was nowhere to be found.  Even so, the steaming MK rep made it abundantly clear she wasn’t going anywhere until the handsomely decorated cardboard box was back in her hands.

“It’s my property, and I want it back!” she stated in no uncertain terms, giving no ground and entertaining no discussion on the topic, then reinforcing her wrath with a stream of invective while tapping her foot expectantly.  It was at this moment that the proprietor gave up the search for the lost box and, rising up to his full height behind the counter, delivered the memorable line.  “Stop!” he said, emphasizing the point by extending his hand and arm in the forceful manner associated with well-trained crossing guards.  Having halted the MK representative mid-insult, the proprietor delivered his coup des mots.  “Ma’am,” he said, cool as a cucumber, “With all the suffering and misfortune in this world today, do you think we could try to keep this matter in perspective?”

I’ve forgotten her exact response, but if memory serves it was along the lines of, “Huppity huppity uhnn.” With nothing more to say, she took an embarrassed glance at the unsupportive faces of the people she had been holding up, then slinked out of the store.  When it came my time to pay, I smiled widely at the store’s owner and thanked him profusely; for so succinctly saying what so desperately needed to be said… for the excellent entertainment… and for enhancing my spoken repertoire with a useful phrase to be henceforth trotted out whenever confronted by anyone making something out of nothing.

For example, in the context of yesterday’s elections, the punditry is all agog about the big changes to be ushered in by the Republicans regaining much of their lost political clout.  To which I might respond…“With all the suffering and misfortune in this world today, do you think we could try to keep this matter in perspective?”  Appropriate? I think so, and here’s why.  From a big-picture perspective, history clearly shows that in all the ways that actually matter – at least to those who care about personal freedoms and the fostering of a strong economy – it has hardly mattered a whit which of the two entrenched political parties are at the top of the leader board.  Sure, there have been fleeting periods of some small improvements in those key criteria – and these periods have come about during the reigns of both Democrats and Republicans – but it’s mostly been a one-way street toward more government, and the attendant costs of that shift.  On that point alone, one is entitled to be skeptical about any real change coming to pass.  That’s the big picture.

Grinding down a level to the present time, however, we note that the Republican resurgence is largely being attributed to voter concerns over the damaged economy and out-of-control government spending – concerns, you know, we share.  One poll reported that fully nine out of ten people exiting the voting booth said that they thought the economy was in bad shape.  So, now we have the House of Representatives solidly in the Republican camp, and the Senate divided by a razor-thin margin. The big house, of course, is still occupied by Obama. But other than the power of the presidential veto – a double-edged political sword should any of the Republicans’ cut-the-government initiatives actually make it through the Senate – the man is now largely isolated and irrelevant.  No question about it: the real fireworks will be happening in Congress. While we can’t know everything that’s going to be proposed, it’s safe to say that – given the Republican surge – the legislative agenda will be replete with initiatives aimed at undoing some of the worst damage inflicted over the last few years.  And that’s where things get interesting, but maybe not in the way you’d expect. I’ll tell you why in a moment, but first a bit more spade work is required.

While we can’t yet know all the new legislation that will be pushed forward by the reinvigorated Republicans – or drooping Democrats, for that matter – it’s a fairly safe bet that most such legislation won’t make it all the way through the briar patch in order to become law. That’s what gridlock is all about.  That said, rightly fearing for their own fates in the 2012 elections, some Democrats may be tempted to jump the aisle and support the Republicans in passing government-rollback legislation over the next year… legislation that even Obama might be reluctant to veto.

Huzzah, some dear readers might be thinking. Not so fast…The problem with the coming episode of gridlock goes back to the fact that the nine out of ten people mentioned in the poll were right – the economy’s a mess.  Over the last year, the only thing that has kept it from getting downright dire has been the government’s unhesitant intervention… its unleashing trillions of dollars of new money into the economy and supporting failed institutions with trillions more by buying up toxic mortgages, offering purchase incentives, suppressing interest rates, offering tax credits, and so forth.

The entire article:
http://www.caseyresearch.com/displayCdd.php?id=578

Wednesday, November 3, 2010

Under The Radar

It looks like there are some really happy folks today and some sad ones.  The see-saw tilted back in the other direction as predicted. Meg's $141 million just wasn't enough.  Imagine if she started the Meg Whitman Foundation instead with the $141 million?  What a legacy that could have left.  It's ironic that she probably lost due to the fact that her nanny was not a legal citizen.  Fortunately, Fiorina only spent $6.5 million of her own money in her defeat.

Who would have thought that the witch would lose?  Rand Paul proved that a Libertarian disguised as a Republican can get some votes.  Reid squeaked one out.  S. Carolina shocked us all by electing a female of Indian descent. That's a first time for both in that state.

I'll just repeat my comments from November 8, 2008.  Just replace Democrats with Republicans.
"On the flip side, I say to my Democrat friends 'be careful what you wish for'. The Democrats have complete control over the near future. For that, they will be given complete credit for 100% of what happens."
Random Roving, November 8, 2008

Of course, no one has 100% control now.  That's what will make the next two years so interesting.  It will be "finger pointing madness".  Can you hear it already, "if we controlled the House and Senate, then......" or "if we controlled the House and the Presidency then....." or "if you wouldn't have...., then......".  The foundation is now laid for the chaos of 2012.

As the post-election hoopla and Sheeple grazing continues, the Federal Reserve today is making their decision on the next "cruise ship", the QE2.  Stay tuned.

Tuesday, November 2, 2010

Election Day Thoughts

This might be the most interesting election since 2008.  It will be the most interesting mid-term election in some time.  The mob will ascend on the voting booths in record numbers I think.  I voted early last week to avoid the frenzy.  As I stood in front of the voting machine I thought, "do I just vote Libertarian with one quick click or click it one by one?".  I still claim to not belong to any party, but my presidential vote for Ron Paul in 2008 still looks like the best one. So I kept my direction consistent.

As I predicted for 2008, "change" will be the main theme.  Not the "change" that political posters speak to, but change of the people in power.  The mob is angrier than ever so they'll try to throw out as many incumbents as possible.  The Tea Party is still just a light version of what is to come.  It's almost comical at this stage.  The funny part is that the Republicans will "pound their chest" in victory only to be ousted the next time.  It will be a viscious cycle for some time.

Doesn't the fact below indicate that something is seriously wrong with our system?  $140 million??  Just think what some charities could do with $140 million?

"Republican Meg Whitman has spent more than $140 million so far on her campaign for California governor, nearly $40 million of it during the last three months, she reported Tuesday.  The amount the billionaire former eBay chief executive has spent on advertising and political consultants, most of it from her personal fortune, stands in sharp contrast to Democratic gubernatorial candidate Jerry Brown, who reported Tuesday that he has spent $10.7 million this year, nearly all of it since Labor Day."
Source: Huffington Post

"Incumbents beware."
Random Roving, January 1, 2010

Monday, November 1, 2010

Historical View of Inflation

A nice historical view of inflation.  SGS is sourced from Shadowstats.com.


Some Facts For Election Day

With the election upon us and politics really heating up, it might be a good time to present some more facts.  Both teams keep fighting and pointing fingers, but the graph below shows participation from both sides.  It also took some indulgent consumers to make it happen.  We were "all in".  We're still "all in". Reagan kicked it off in 1982 and the party continues today.  Note the difference between now and the Roaring 20's.  We have them beat by a mile.  Does the "down" relate in magnitude to the "up".  We hope not.  But, note that the down in the 30's was below the level where the Roaring 20's began.

Sunday, October 31, 2010

Yeah-man!

 It sure seems convenient that we have another bomb scare within a week of the election.  Hmmmmm.

"Yemen officials arrested a suspect Saturday in the alleged plot to mail bombs to two synagogues in Chicago, but clues also lead to a bombmaker for Al Qaeda in the Arabian Peninsula (AQAP), reports say."
Source: The Christian Science Monitor

Yemen somehow comes to the forefront again.

"How con-VEEN-ient!"
The Church Lady - Saturday Night Live

Chaotic Collisions

"Instead of unfolding in a nice, linear, straightforward manner, these colliding events will happen quite rapidly and chaotically.  By mentally accepting that this proposition is not only possible, but probable, we are free to make different choices and take actions that can preserve and protect our wealth and mitigate our risks."
Chris Martenson

Saturday, October 30, 2010

Boobus Americanus

James Quinn may have come up with one better than "sheeple".  Boobus Americanus...why didn't I think of that one?
"Today’s Keynesian economists have convinced boobus Americanus that the Great Depression was caused by the Federal Reserve being too tight with monetary policy and the Hoover administration not providing enough fiscal stimulus. Ben Bernanke and Barack Obama used this line of reasoning to ram through an $850 billion pork-laden stimulus package, as well as the purchase of $1.2 trillion of toxic mortgages by the Federal Reserve.  The only trouble is that this storyline is a complete sham.  The fact that colossal stimulus spending, zero interest rates, the purchase of over a trillion in toxic assets by the Fed, and the loosest monetary policy in history have done absolutely nothing to revitalize the economy, has proven that Keynesian policies have been a wretched failure. This is not a surprise to Austrian school economists.  Keynesian policies failed during the Great Depression, and they are failing today. An economic catastrophe caused by loose monetary policies, crushing levels of debt, and appalling lending practices cannot be solved by looser monetary policies, issuance of twice as much debt, and government commanding banks (or, in the case of Fannie and Freddie, “commandeering”) to make more bad loans.  The Great Depression was caused by Federal Reserve expansion of the money supply in the 1920s that led to an unsustainable credit-driven boom. When the Federal Reserve belatedly tightened in 1928, it was too late to avoid financial collapse. According to Murray Rothbard, in his book America’s Great Depression, the artificial interference in the economy was a disaster prior to the depression, and government efforts to prop up the economy after the crash of 1929 only made things worse. Government intervention delayed the market’s adjustment and made the road to complete recovery more difficult."
James Quinn, The Burning Platform

the entire article:
http://www.theburningplatform.com/

Friday, October 29, 2010

Korean Games In The DMZ

Rekindle, reignite...it's all the same thing. My prediction on this one was that when the tide lowers, it's easy to pick a fight with an old foe. It usually takes a small spark."
Random Roving, March 8, 2009

"Tensions escalated along the North Korea-South Korea border on Friday after the North fired two rounds at its southern neighbour. South Korean troops immediately fired back, an official told The Associated Press. The shots from North Korea were fired towards a South Korean guard post in the Demilitarized Zone between the two countries, an official at the Joint Chiefs of Staff in Seoul told AP. No one was injured and it wasn't clear whether the shots represented a military action or were an accident. However the shots came just hours after the North vowed to retaliate after the South rejected a Pyongyang proposal for military talks. It's the latest escalation in an ongoing game of military brinksmanship that hit a high point when North Korea sunk the South Korean warship Cheonan in March, killing 46 sailors. Earlier this week Pyongyang demanded that Seoul resume large-scale food aid shipments despite the current tensions. The demand came after the North seized a South Korean fishing vessel earlier in the month. And in August, tensions were once again high after the North fired 110 rounds near the disputed border. All the shells landed harmlessly in the water within the North's territory. Earlier that month, South Korea held five days of naval drills off the west coast of the divided peninsula, that the south called a rehearsal for invasion."
Source: CTV Calgary

Thursday, October 28, 2010

Misleading Beliefs

"The most important part of this story is getting our minds to accept reality without our passionate beliefs interfering. By ‘beliefs’ I mean statements like these:
•“Things always get better and are never as bad as they seem.”
•“If Peak Oil were ‘real,’ I would be hearing about it from my trusted sources.”
•“Dwelling on the negative is self-fulfilling.”
While each of these things might be true, they also might be false and therefore misleading, especially during periods of transition. Our job is to remain as dispassionate and logical as possible."
Chris Martenson

Wednesday, October 27, 2010

Boudreaux & Mbah Maridjan

When I read this story, I couldn't help but think of my friend Boudreaux.  Why is it that we refuse to listen to the alerts?  Is it like the car alarm in the mall parking lot?  Is it the boy that cried wolf?

"Even after an eruption alert was issued and most villagers on the slopes of Java's Mount Merapi had been evacuated, 83-year old Mbah (grandfather) Maridjan stayed put. The spiritual guardian of the mountain, his battle to tame one of Indonesia's most active volcanoes ended on Wednesday when he was buried by the mountain's thick ash.  He was reportedly found dead in a prayer position in his house, as rescuers also dug out more than two dozen more victims in the area - many who had also refused to leave.  In the wake of the eruption, houses and fields were left blanketed in thick, white ash, while leaves had been singed off trees.  Villagers say they will mourn the loss of a respected elder who was as important to them as the mountain itself."
Source: BBC

Eruption alerts are everywhere and the sheeple continue to graze with no concern.

The Fourth Turning Cleansing

"People often talk of the Fourth Turning as this cataclysm and it's horrible and so on. It begins the world again.  It tears down institutions that don't work and rebuilds it successfully.  It replaces them with institutions that do work.  It starts our community and social life fresh again."
Neil Howe, Author, "The Fourth Turning" (Interview with Jim Puplava)

Monday, October 25, 2010

Sooner Or Later

"There is no means of avoiding the final collapse of a boom brought on by credit and fiat monetary expansion. The only question is whether the crisis should come sooner in the form of a recession or later as a final and total catastrophe of depression as the currency systems crumble.”
Ludwig von Mises

I Pity The Fool

Could this be the ultimate sign of a market top in gold?  I don't think so. Sell when Drago starts doing commercials for Russian gold!



Friday, October 22, 2010

The Challenge Of The Weatherman

"So often people make the observation that we can't tell what the weather is going to be tomorrow so how can you possibly say anything about what the weather is going to be like in three months. Well obviously you can't.  Seasons change.  So it's not a question of having a rainy day today and a sunny day tomorrow.  It's the broader shift.  You can't predict the breaking of each wave on the seashore.  You can't predict the tides. You see what I mean.  This is looking more broadly at changes.  When you refocus your field of vision, not on the breaking events today and tomorrow, but on a longer term field of view, these changes become pretty clear."
Neil Howe, Author, "The Fourth Turning" (Interview with Jim Puplava)

Thursday, October 21, 2010

Tis The Season To Be......

“To everything there is a season, and a time to every purpose under the heaven.”
Book of Ecclesiastes

Wednesday, October 20, 2010

C'est La France

Les jeunes fran├žais prennent en charge.

The Delusional Election

"If you think all the game-changing decisions to be made on November 2 will be by voters at the ballot boxes, think again! In his latest online presentation, Monty Agarwal reminds us that, on that very same Tuesday, Fed Chairman Ben Bernanke will ... corral together the other voting members of the Federal Open Market Committee ...send any dissenters off to the shearing shed, and ...before the following day, close the deal on QE2 — the next major round of mass money printing.  How ironic the twists and turns of history can be!  while millions of voters will likely vote to transform Capitol Hill into a new stable of fiscal conservatives ...Just 12 men — meeting two and a half miles away — will be voting to transform America into a field of money trees.  Strangely ...The vote at the polls will put the padlock on America's fiscal stimulus. But ...The vote at the Fed will unleash a whole new round of monetary stimulus, potentially driving more liquidity into gold, commodities, foreign currencies, and emerging markets.  End result: One of the greatest disconnects of all time between ...A sinking economy on the one side, and ...The real possibility of roaring bull markets in certain asset classes on the other side."
Martin Weiss, Weiss Research

Tuesday, October 19, 2010

Weather & Wind

"You don't have to be a weatherman to know which direction the wind is blowing."
Unknown

Monday, October 18, 2010

The French Join The Trend

Last month it was the Spaniards, now the French rise up.

"After days of rail disruption, unions are putting on the pressure before Wednesday’s Senate vote on President Nicolas Sarkozy’s unpopular pension reforms. He is refusing to back down over a two-year retirement age hike, but so too are the unions.  Didier Le Reste of the CGT union warned of more strike action.  The start of the week will see a widening of the strike, with more sustained action in sectors such as road transport, energy, postal and telecommunications and public service and commerce,” he said.  Fears that the two major airports in Paris could run out of fuel in the next 48 hours have been dispelled by the government despite blockades at France’s 12 refineries. However supply shortages could hit elsewhere by mid-week with depots in the south west already depleted by an unrelated stoppage."
Source: Euronews
 
"In a downward trending mass social mood, it's very likely that labor strikes will become very popular again. We might even see a professional sports strike in the next few years. An angry mob loves a strike and a picket line. The cycle will likely bring unions back to strength as fear and anger 'drives the herd closer together'."

Random Roving, November 24, 2009, "Three Strikes You're Out"

Jobs Update

An updated view of the job situation.

Source: Bud Conrad, Casey Research



Sunday, October 17, 2010

A Current Pulse On The Puzzle Pieces

This blogger summarizes the current state in 12 Ominous Signs For World Financial Markets:

#1 Corporate insiders are getting out of the U.S. stock market at an absolutely blinding pace. It is being reported that the ratio of corporate insider selling to corporate insider buying last week was 1,411 to 1, and this week the ratio has soared even higher and is at 2,341 to 1.
#2 Many of the world's wealthiest people are buying absolutely massive quantities of gold right now.
#3 It is being reported that J.P. Morgan is gobbling up the rights to as much physical gold as it possibly can.
#4 The United States Mint has announced that it has run out of 1-ounce, 24-karat American Buffalo gold bullion coins and that it will not be selling any more of them in 2010.
#5 It is becoming increasingly difficult to explain the unusually high option volume that we are witnessing right now.
#6 Some very large investors are making massive bets that the S&P 500 is going to take a serious tumble during the month of October.
#7 On Tuesday, the Bank of Japan shocked world financial markets by cutting interest rates even closer to zero and by setting up a 5 trillion yen quantitative easing fund.
#8 The president of the Federal Reserve Bank of New York and the president of the Federal Reserve Bank of Chicago are both publicly urging the Fed to do much more to stimulate the U.S. economy, including beginning a new round of quantitative easing, even if it means a significant rise in the U.S. inflation rate.
#9 Nobel Prize-winning economist Joseph Stiglitz told reporters on Tuesday that the loose monetary policies of the Federal Reserve and the European Central Bank are throwing the world into "chaos".
#10 At the end of September, federal regulators announced a $30 billion bailout of the U.S. wholesale credit union system.
#11 Bank of America, JPMorgan Chase and GMAC Mortgage have all suspended foreclosures in many U.S. states due to serious concerns about foreclosure procedures. Now, Texas Attorney General Greg Abbott is actually demanding that all mortgage servicing companies in the state of Texas immediately suspend all foreclosures, the selling of foreclosed properties and the eviction of people living in foreclosed properties until they have completed a review of their foreclosure procedures.
#12 Not only that, but Nancy Pelosi and 30 other members of Congress are requesting a federal investigation of the foreclosure practices of U.S. mortgage lenders. Needless to say, this controversy has the potential to turn the entire U.S. mortgage industry into an absolute quagmire.


So are dark days ahead for world financial markets?  Well, yeah, but it is incredibly hard to predict exactly when things are going to fall apart.  The truth is that there are going to be a whole lot more "crashes" and "collapses" in the years ahead.  The important thing, as discussed yesterday, is to keep your eye on the long-term trends.  The U.S. economy is undeniably in decline. The only thing keeping the economy going at this point is a rapidly growing sea of red ink. Debt is literally everywhere. It is what our entire financial system is based on in 2010. In the months and years to come, the major players are going to try very hard to keep all the balls in the air and to continue the massive shell game that is going on, but in the end the whole thing is going to collapse like a house of cards.  Unfortunately, we have been destroying the U.S. economy for decades and there is simply not going to be a happy ending to this story.

The entire post:
http://theeconomiccollapseblog.com/archives/12-ominous-signs-for-world-financial-markets

Saturday, October 16, 2010

Martenson's Status Report

An update from Chris Martenson:
"By my analysis, we are not yet on the final path to recovery, and there are one or more financial 'breaks' coming in the future. Underlying structural weaknesses have not been resolved, and the kick-the-can-down-the-road plan is going to encounter a hard wall in the not-too-distant future. When the next moment of discontinuity finally arrives, events will unfold much more rapidly than most people expect. My work centers on figuring out which macro trends are in play and then helping people to adjust accordingly. Based on trends in fiscal and monetary policy, I began advising accumulation of gold and silver in 2003 and 2004. I shorted homebuilder stocks beginning in 2006 and ending in 2008. These were not ‘great' calls; they were simply spotting trends in play, one beginning and one certain to end, and then taking appropriate actions based on those trends. We happen to live in a non-linear world; a core concept of the Crash Course. But far too many people expect events to unfold in a more or less orderly manner, with plenty of time to adjust along the way. In other words, linearly. The world does not always cooperate, and my concern rests on the observation that we still face the convergence of multiple trends, each of which alone has the power to permanently transform our economic landscape and standards of living. Three such trends (out of the many I track) that will shape our immediate future are: Peak Oil, Sovereign insolvency, and Currency debasement.  Individually, these worry me quite a bit; collectively, they have my full attention."

The entire article:
http://financialsense.com/contributors/chris-martenson/prediction-things-may-unravel-faster-than-you-think

Friday, October 15, 2010

Steve Covey On Change

"If there's one thing that certain in business today, it is change. And as soon as companies are hit by change, Covey says, they face four key hazards — failure to execute, a crisis of trust, loss of focus and debilitating fear. A perfect recipe for downfall."
Source: The Economic Times

Thursday, October 14, 2010

The Marketing of Madness

One of my personal "flags" is when someone creates a catchy phrase or name for something that seems to be too important to be summarized by that catchy name.  A few examples might be "War On Terror", "WMD's", "Axis of Evil", "Shock and Awe", and "Main St. vs Wall St.".  When we were kids, we called it the "atomic bomb". That quickly presented images of a mushroom cloud. WMD's sounds really high tech and not really intimidating. "War On Terror" is nice and vague. It's better than saying "waging war on people that don't think like us". That's just too many words. "Shock and Awe" sounded really cool. Who wants to say "dropping missiles in a Middle Eastern city so that we can obtain control of oil reserves". That's just too complex.  Then we had "Desert Storm" and "Desert Shield".  With Mexico we now have the "Battle on The Border".  Main Street and Wall Street is perfect because it quickly creates a victim-villian relationship.  BP provided us with "Top Kill" and "Static Kill".
 
The latest one that I like has even been shortened to an abbreviation, "Q.E.".  Yes, quantitative easing.  This cute phrase represents the process where the Federal Reserve prints a bunch of money and we quickly go spend it on things we believe that we have to have.  The short term result is economic stimulation and a facade of economic strength.  The media now just calls the upcoming "printing event" QE2.  Sounds like a ship named after a British queen.  Get prepared for QE2.  The timing with an election only appears to be a  coincident.  Wink wink.

"The economy is weak. So you print money. The money pushes up asset prices.  People think they are wealthier. They think there’s a real boom going on.  They invest. They hire. They spend.  Then, there is a real boom!  Do you believe it works like that, dear reader? If you do, you should be an economist. Or a doorstop. There’s no doubt that printing money can create a boom. But it’s a phony boom, not a real one. And when it blows up…which it inevitably does…people are worse off than they were before.   It’s one thing to introduce small amounts of extra “money” into a growing, prosperous economy. It’s a fraud. It’s a mistake. But it doesn’t blow-up the system. It’s petty larceny; nobody cares.  It’s another thing to introduce large amounts of new currency into a funky, struggling economy."
Bill Bonner, The Daily Reckoning

Wednesday, October 13, 2010

Bernanke's Vision

"U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation."
Ben Bernanke, 2002

Tuesday, October 12, 2010

Now That's What I'm Talkin' Bout

And the Tea Party is fired up about 86,000 people at the Glenn Beck "love-fest"???  The French are leading the charge.

"In the fourth such protest in a little over a month, unions estimated that 3.5 million people had taken to the streets against President Nicolas Sarkozy's pension bill – a 20 per cent rise from previous marches and what they called an 'exceptional' figure."
Source: Telegraph UK

Now we're starting to talk about something tangible!

"In a downward trending mass social mood, it's very likely that labor strikes will become very popular again. We might even see a professional sports strike in the next few years. An angry mob loves a strike and a picket line. The cycle will likely bring unions back to strength as fear and anger 'drives the herd closer together'."
Random Roving, "Three Strikes You're Out", November 29, 2009

Trouble On The Back Nine

Dana Carvey said on his fortieth birthday that he was "starting to play the back nine".  Some of these superstars might have wished they were out of the limelight for the back nine.  Maybe the downward trending curve of mass social mood has swept them up.

"Brett Favre may have put in an admirable showing even as the Vikings fell to the Jets Monday night, but it was the quarterback's sex scandal that dominated headlines after the game. 'If you want to talk about what happened in the football game tonight, I'd love to,' Favre said when asked whether the allegations against him were true. The married quarterback notched his 501st touchdown pass during the game, but then faced a throng of reporters asking questions about whether he sent nude pictures of himself to a former New York Jets game-day host and propositioned a masseuse. When asked what he told his teammates before the game, Favre snapped, 'That's between me and my teammates.'"
Source: ABC News

"People inside Lance Armstrong’s inner circle of friends and colleagues are being called to testify in front of a grand jury investigating suspected doping and fraud in professional cycling, raising the intensity of the inquiry into the possibility of Armstrong’s involvement in crimes while he rode for the United States Postal Service team."
Source: New York Times

"Brett Favre has retired again. I'm one that felt that he would have been best to retire as a Packer, but it's hard to retire the mindset of a competitor, champion, and legend.....ask Lance Armstrong about that. LA might have just destroyed the whole concept of retiring before you get past your prime. Hopefully Brett will find peace hanging out on his ranch in Kiln, MS. Weekend touch football games in his Levis should keep the spirit alive."
Random Roving, July 29, 2009

Ferrell On The Future

Paul Farrell provides this bleak forecast:

"Yes, big warning, the Second American Revolution will extract painful austerity, not the “happy days are here again” future touted by tea-baggers. For years it’ll be impossible for most of America’s 95 million investors to develop a successful investment or logical retirement strategy. Why? Political chaos will translate into extreme volatility and a highly unpredictable stock market. Result: Wall Street will lose another 20% of the value of your retirement portfolio in the next decade, just as Wall Street did the last decade. So if you think you’re “mad as hell” now, “you ain’t seen nuthin’ yet!”
Here’s the timeline:
Stage 1: The Dems just put the nail in their coffin by confirming they are wimps, refusing to force the GOP to filibuster the Bush tax cuts for America’s richest.
Stage 2: The GOP takes over the House, expanding its war to destroy Obama with its new policy of “complete gridlock,” even “shutting down government.”
Stage 3: Obama goes lame-duck.
Stage 4: The GOP wins back the White House and Senate in 2012. Health care returns to insurers. Free market financial deregulation returns.
Stage 5: Under the new president, Wall Street’s insatiable greed triggers the catastrophic third meltdown of the 21st century Shiller predicted, with defaults on dollar-denominated debt.
Stage 6: The Second American Revolution explodes into a brutal full-scale class war rebelling against the out-of-touch, out-of-control greedy conspiracy-of-the-rich now running America.
Stage 7: Domestic class warfare is compounded by Pentagon’s prediction that by 2020 'an ancient pattern of desperate, all-out wars over food, water, and energy supplies would emerge' worldwide and 'warfare is defining human life.'"
The entire article:
http://www.marketwatch.com/story/america-on-the-brink-of-a-second-revolution-2010-09-28?pagenumber=1

Monday, October 11, 2010

A Chilling Irish Reminder

"Northern Ireland police said Saturday they were investigating a car bomb that exploded overnight in the city of Derry, about 70 miles northwest of Belfast. No one was hurt in the bombing, which happened in the city center shortly after midnight and left the car on fire, police said. The explosion followed an attack Friday in which masked gunmen in Belfast fatally shot a man at point-blank range on a busy shopping street. A police spokesman said the attack was a 'chilling reminder of a violent past that everyone in the community hoped we had left behind.'"
Source: CNN

"When will N. Ireland re-ignite?
Random Roving, January 12, 2009

"The events of the past week indicate that more trouble could lie ahead."
Random Roving, March 10, 2009

Sunday, October 10, 2010

Ten Years Of Zero

I've posted about the "boiling frog" a few times in the past.  The chart below really sums it up.  If I "Jay-walked" and stopped the average Joe on the street and asked them what % the Dow Jones Industrial Average has gained in the last 10 years, I would bet that over 90% of the people would respond with a positive number....probably a very positive number.  This chart is more evidence that the "buy and hold" strategy died a decade ago.

Dow Jones Industrial Average - Last 10 years

Saturday, October 9, 2010

The Simpler The Better

"We must make things as simple as possible, but not simpler."
Albert Einstein

Friday, October 8, 2010

The Avalanche Risk

"Like everybody else, I have no idea exactly what’s going to happen, or precisely when. Anybody who says they do know should be greeted with a furrowed brow and a frown of suspicion. As my long-time readers know, I prefer to assess the risks and then take steps to mitigate those risks based on likelihood and impact.  Which means that although we cannot predict the size (exactly how much) or the timing (precisely when) of economic shifts or world-changing events, we can certainly understand the risks and the dimensions of what might happen. Just as we cannot predict when an avalanche will release from steep slope, or even where or how big it will be, we can readily predict that constant snowfall coupled with the right temperature conditions will lead to an avalanche sooner or later, and more likely in this gully than that one. Given certain conditions, we might expect one that is larger or smaller than normal. Although we don't know exactly when or how much, we do know that when snow accumulates, so do the risks of more frequent and/or larger avalanches."
Chris Martenson

The entire article:
http://financialsense.com/contributors/chris-martenson/prediction-things-may-unravel-faster-than-you-think

Thursday, October 7, 2010

Sheeple Alert #143

It's mornings like this when I read Google News and say "Wow". Lady GaGa, Beyonce, and Ellen???!?! How does Lady Nancy feel about her spot at #11?


FORBES Worlds Most Powerful Women


Martenson On Mood

"Social moods are steady for long periods, and then they shift.  This is what we should train ourselves to expect."
Chris Martenson

Wednesday, October 6, 2010

Golden Rocket

It seems like yesterday when I made a post about gold breaking the $1300/ounce barrier. Yesterday it rocketed upwards almost breaking $1350.  But, keep in mind that everything has made a strong move up.  As Robert Prechter has said in the past, "all the same".  Stocks and commodities are very in sync which is not the norm.  Similar behavior and patterns occurred leading up to the fall of 2008. 
Yesterday's Gold price in RED

Tuesday, October 5, 2010

Texas Pirates

Back in November, 2008, I made a post related to the pirates off the coast of Somalia. It looks like the pirates are invading the Republic of Texas.

"As the survivor of what's being called a pirate assault on Falcon Lake, Texas, recounts the harrowing ordeal that likely took her husband's life, Texas Gov. Rick Perry is leading calls for a tough US response to spillover violence from Mexico's bloody drug wars onto American soil. The Falcon Lake attack, where three boats likely connected to the Zeta drug-running gang reportedly shot at 30-year-old David Hartley and his wife, Tiffany Hartley, while they rode personal watercraft, now threatens to become an international incident. The pirates, brandishing AK-47s, so far have confronted and robbed five US bass-fishing boats that have wandered into Mexican waters, which the Americans are allowed to do on the jointly administered lake. In some of those instances, the Zeta pirates have identified themselves as "federales," but their well-known and visible Z tattoos indicate that they're brigands, not Mexican officials. On Tuesday the mother of Mr. Hartley begged US Secretary of State Hillary Rodham Clinton to intervene in efforts to try to locate his still-missing body. The pleas from the border came as authorities in Texas reported other evidence of Mexican drug violence in the US, including a bullet-riddled truck found on the US side of the border last week with the bodies of two Mexican nationals inside – an act of violence that Brownsville Police Chief Carlos Garcia described as a cartel-ordered 'hit.' 'The larger significance of [the pirate attack] is whether it's an indicator of what we greatly fear, which is that violence would spill over [the US border] in a direct way,' says Robert Chesney, a national security law expert at the University of Texas, in Austin."
Source: Christian Science Monitor

"During the contraction phase of the cycle, the 'have nots' will seek what they feel entitled to from the 'haves'. This will likely occur on all scales. As the mass social mood continues to shift down, what protective measures will be taken by governments and individuals to protect themselves?"

Eye Of The Storm

"We are in the eye of the storm. That little bit of blue sky Washington is pumping up is no different from the patch of blue at the eye of a hurricane. The next arm of the storm is on the way."
Doug Casey, Casey Research

Monday, October 4, 2010

Maybe October?

Well I couldn't have been more wrong about September. It was the best September in 71 years!
Shall I dare post some lyrics about October?

OCTOBER, U2
October

And the trees are stripped bare
Of all they wear
What do I care
October
And kingdoms rise
And kingdoms fall
But you go on

Gold and A Candy Bar Please

"A German firm called “Gold to go” plans to introduce gold vending machines in the US before the end of the year. The timing is no doubt intended to coincide with both US elections and the holiday shopping season. The company has already installed machines in Abu Dhabi, and around Europe, with plans to have 35 machines in place by the end of December. The first US machines will be installed in Florida and Las Vegas. Customers will be able to use debit cards to buy gold in 1-, 5-, and 10-gram and 1-ounce bars. The machines will also sell South African Krugerrands, Australian Kangaroos, and the Canadian Maple Leaf gold coins. At about $1,300/ounce, a 1-gram bar will set you back about $46. All bars and coins come in a “precious gift box,” according to the company’s web site. A perfect little stocking stuffer. The company is missing a great opportunity by not installing one outside the New York Stock Exchange. What better way to get a read on market sentiment than to check the length of the line waiting to buy gold from a machine?"
Paul Ausick

Silver & Gold

I've spent a lot of time pitching gold, but not enough on silver. It's been on fire lately. The ETF "SLV" provides a nice purchase option.  A bag of junk silver provides a good compliment.


Sunday, October 3, 2010

Dumbing Down The Masses

My buddy JD always says "they're dumbing down the operation".  James Quinn on http://www.theburningplatform.com/ just shared these statistics:

-33% of high school graduates never read another book for the rest of their lives.
-42% of college graduates never read another book after college.
-80% of U.S. families did not buy or read a book last year.
-70% of U.S. adults have not been in a bookstore in the last five years.
-57% of new books are not read to completion.
-There are over 17,000 radio stations and over 2,000 TV stations in America today.
-Each day in the U.S., people spend on average 4.7 hours watching TV, 3 hours listening to the radio and 14 minutes reading magazines.
-The projected average number of hours an individual (12 and older) will spend watching television this year is 1,750.
-In a 65-year life, the average person will have spent 9 years glued to the tube.
-Number of 30-second TV commercials seen in a year by an average child – 20,000
-Number of videos rented daily in the U.S. – 6 million
-Number of public library items checked out daily – 3 million
-Percentage of Americans who can name The Three Stooges – 59%
-Percentage who can name at least three justices of the U.S. Supreme Court – 17%

Saturday, October 2, 2010

Sound Banking

"A sound banker, alas, is not one who foresees danger and avoids it, but one who, when he is ruined, is ruined in a conventional and orthodox way along with his fellows, so that no one can really blame him."

John Maynard Keynes (1931), "The Consequences to the Banks of the Collapse of Money Values"

Friday, October 1, 2010

The Supersize Me Era

Team Blue and Team Red continue to point the finger at one another in the blame game.  Twenty eight years of debt accumulation and we want to blame those in power today.  It all kicked off with the "morning in America".  How steep can the curve get before it rolls over?  As a wise man once said "don't try to catch the falling arrow".




"The Keynesian school argues that 'money supply' is the driver of the economy and, in times of cooling economic activity, deficit spending will kick start it again. This behaviour has been in place since the Reagan years and the net result has been the emergence of a debt mountain.  The Austrian school argues that “the market” should be allowed to breathe in and out without interference and that mindlessly throwing money at the economy will result in nothing other than malinvestment. A corollary to this school of thought is that there needs to be an external discipline exerted on banker behaviour in the form of formal constraints regarding the quantum of money in circulation. Logically (it is argued by growing number of people) the most sensible constraint will be a gold standard in some form."
Brian Bloom

Thursday, September 30, 2010

Spaniards Strike

"Spain's first general strike for eight years, a protest against the Socialist government's public spending cuts and easier hire-and-fire laws, had a limited impact beyond disrupting transport and some factories.  Spanish unions said 10 million people, or more than half the workforce, were on strike. The government gave no numbers."
Source: Reuters

Now that's what I call a strike. More than half the workforce. Wow!

"In a downward trending mass social mood, it's very likely that labor strikes will become very popular again. We might even see a professional sports strike in the next few years. An angry mob loves a strike and a picket line. The cycle will likely bring unions back to strength as fear and anger 'drives the herd closer together'."

Random Roving, November 24, 2009

Rekindling The Flames

Keep an eye on these old foes.
"Executives and traders in both countries have said that Chinese customs agents have blocked rare-earth exports since early last week, after a diplomatic dispute over Japan’s detention of a captain of a Chinese fishing trawler in waters claimed by both countries. Japan released the captain Friday."
Source: New York Times


"Rekindle, reignite...it's all the same thing. My prediction on this one was that when the tide lowers, it's easy to pick a fight with an old foe. It usually takes a small spark."
Random Roving, March 8, 2009

Wednesday, September 29, 2010

Dancing With The Sheeple

This blog can often serve as a confessional.  I must admit that my wife made me (yes) watch Dancing With The Stars with her.  As the kids say, "OMG".  Please bring on a root canal next time!  What will the anthropologists say in 100 years when they look back and examine our current culture??

The Next Golden Threshold

Gold has made another strong run and has quickly broken through the next psychological barrier, $1300 per ounce. $2000/ounce here we come!


"So, then why is the gold price rising to new heights? Answer: For 5,000 years, gold has been the most desirable “asset” which human beings have aspired to own. The rising gold price is reflecting a dawning understanding of the fact that the “game” has changed; and – because there are no signs of panic in the various markets – the most logical driver of a rising gold price is that investors are feeling more optimistic than pessimistic about the future of humanity. Arguably, we are about to find out “why” gold has – from time immemorial – been the most desirable asset."
Brian Bloom

Reducing The BOOT Print

The Boogeyman is everywhere and he's "comin' to get us".  There's Al Quaeda, the Axis of Evil, all Muslims, Taliban, Pakistanis, Osama, Iranians, and whoever else we need to get the herd to come together.  The fear factor is very powerful and effective.  Newt is starting to use it to emerge as the frontrunner for Team Red.  The idea below is contrary to the fearmongering and lowering the "boot print" would solve the problem.  But, of course we can't.  FOUR percent of the worlds population consuming 25% of the world's oil requires us to control "the heartland".

"The U.S. spends more on maintaining overseas government operations than all the rest of the world’s nations combined. While the cost of ending our involvement in perma-wars, turning off the lights at military installations, canceling aid and subsidies to foreign governments will cause widespread pain and misery – both at home for the dismissed soldiers and overseas for our allies – doing so is likely to improve our security by dramatically reducing our boot print on the face of the globe."
Source: Casey Research

Tuesday, September 28, 2010

The Cyclic Poem

"History is a cyclic poem written by time upon the memories of man."
Percy Bysshe Shelley

Monday, September 27, 2010

When In Rome, Do As.....

"Throughout history governments have experimented with fiat money. They have done so because the benefits to the government and the insiders that invariably latch on to power are just so damn attractive. The Romans did it by debasing their coinage, but the modern version goes one better by completely disconnecting a currency from any value whatsoever, and then wantonly printing as politically motivated needs or wants arise."
Casey Research

Sunday, September 26, 2010

Tricky Dick's Illusion

"The latest fiat system kicked off in earnest in 1944 when Uncle Scam, in Bretton Woods, NH, got the leaders of the world’s war-weary countries to agree to accept the U.S. dollar as their reserve currency. In return, the U.S. agreed that the currency notes it would subsequently issue would be convertible into a corresponding amount of gold. Then Tricky Nixon came along in 1971 and canceled the right of the bearer to swap the notes for gold. Overnight, the link between the currency and anything tangible was lost. That, of course, opened the door to all subsequent politicians to engage in the whole print, print, print thing. The keystone asset of the former system – gold – soon became a distant memory for the new crop of central bankers and, remarkably, to the bearers of the notes.  For any number of reasons, most of which related to the illusion of increasing prosperity, people simply stopped paying attention to what Uncle Scam was up to. Of course, that illusion was largely based on the increase in nominal wealth: if one year you’re worth $100,000 and three years later you are worth $150,000, the tendency is to feel richer even if your actual purchasing power has gone up by far less or even has declined due to a debasement of the currency. Today’s dollar is worth just 18 cents in 1971 terms."
Casey Research

Saturday, September 25, 2010

IF

"IF" by Rudyard Kipling
If you can keep your head when all about you
Are losing theirs and blaming it on you;
If you can trust yourself when all men doubt you,
But make allowance for their doubting too;
If you can wait and not be tired by waiting,
Or, being lied about, don't deal in lies,
Or, being hated, don't give way to hating,
And yet don't look too good, nor talk too wise;
If you can dream - and not make dreams your master;
If you can think - and not make thoughts your aim;
If you can meet with triumph and disaster
And treat those two imposters just the same;
If you can bear to hear the truth you've spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to broken,
And stoop and build 'em up with wornout tools;
If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breath a word about your loss;
If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: "Hold on";
If you can talk with crowds and keep your virtue,
Or walk with kings - nor lose the common touch;
If neither foes nor loving friends can hurt you;
If all men count with you, but none too much;
If you can fill the unforgiving minute
With sixty seconds' worth of distance run -
Yours is the Earth and everything that's in it,
And - which is more - you'll be a Man my son!

Thursday, September 23, 2010

The Fall Guys

"President Obama's inner circle will likely be losing some key players. CBS News senior White House correspondent Bill Plante reports that sources say David Axelrod, the president's closest advisor, will move to Chicago next spring. Axelrod is expected to reassume his role as campaign manager in Mr. Obama's 2012 reelection bid. A potential, if not likely, replacement for Axelrod is current White House Press Secretary Robert Gibbs. The dominoes don't stop there. Rahm Emanuel, the president's Chief of Staff, may leave the White House as soon as next month."
Source: CBS News

"It was only a matter of time for the rats to start jumping off of the ship. It only makes sense for the budget director to leap first. Geitner and Rahm-bo will be next."

Random Roving, June 30, 2010

"The next four years will be very challenging on all fronts. As I've stated before, the economic cycle is must stronger than a political party or individual politicians. The psychology of the masses will drive the direction. I believe that the Democrats will be navigating the ship through major rogue waves. At the end of that process, the party will be in shambles. At that point, the masses will be disenchanted with both parties. At 'the bottom', there will be a third party that finally gains some steam and becomes a viable competitor. That party will probably be somewhere in the middle"
Random Roving, November 8, 2008

Darkness On The Edge Of Town

This coming November, Bruce Springsteen will release "The Promise: Darkness On The Edge Of Town".  It's six hours of film and more than two hours of audio across 3 CDs and 3 DVDs including a documentary on the making of the album "Darkness On The Edge Of Town".  As a 30 year Springsteen fan, I anxiously await its release.

Over the years, Robert Prechter of Elliott Wave International has made some great comparisons between mass social mood, financial markets, and the mood of music and movies.  He's presented exhaustive analysis on how music and movie themes align with the mass social mood of the people.  As I was reading articles about Springsteen's upcoming re-release of "The Darkness" record, I started to wonder how the timing of both releases would present itself in relation to the financial markets.

"Darkness was an angry record. I took the 10 toughest songs I had.I didn't want something with a broader, more compassionate overview. That didn't feel right to me."
Bruce Springsteen (Interview with Edward Norton at the Toronto International Film Festival, Sept. 2010)

The chart below presents the Dow Jones Industrial Average Gold Ratio with the two dates for the release of "Darkness On The Edge Of Town".  My hypothesis proves to be true.  Both releases align with a downward trending cycle.
Dow Jones Industrial Average Gold Ratio

DARKNESS ON THE EDGE OF TOWN
They're still racing out at the Trestles,
But that blood it never burned in her veins,
Now I hear she's got a house up in Fairview,
And a style she's trying to maintain.
Well, if she wants to see me,
You can tell her that I'm easily found,
Tell her there's a spot out 'neath Abram's Bridge,
And tell her, there's a darkness on the edge of town.
Everybody's got a secret, Sonny,
Something that they just can't face,
Some folks spend their whole lives trying to keep it,
They carry it with them every step that they take.
Till some day they just cut it loose
Cut it loose or let it drag 'em down,
Where no one asks any questions,
or looks too long in your face,
In the darkness on the edge of town.
Some folks are born into a good life,
Other folks get it anyway, anyhow,
I lost my money and I lost my wife,
Them things don't seem to matter much to me now.
Tonight I'll be on that hill 'cause I can't stop,
I'll be on that hill with everything I got,
Lives on the line where dreams are found and lost,
I'll be there on time and I'll pay the cost,
For wanting things that can only be found
In the darkness on the edge of town.

P.S. Happy Birthday Bruce!