From The Daily Capitalist:
... There are two factors which lead me to believe that it is more likely that we will see more quantitative easing (QE).
While Shostak concludes that the Fed is wary of price inflation (that they are causing) and that this will deter another round of money pumping, I think the primary motivation behind QE is unemployment, not price inflation.
The consequence of taking their foot off the money pedal will lead to higher unemployment and I do not think this is politically acceptable to the Fed or to the Administration. I think they will institute a new round of quantitative easing (QE3) because politicians will demand that the Fed "do something."
Which is, of course, the worst thing they could do. It will lead to...
Read full article...
More Cruxallaneous:
This should scare everyone in America
Pimco's El-Erian: "Financial repression" coming to the U.S. soon
Master contrarian Jim Grant: "There will be a panic and it'll seem as if the world's ending..."
View the original article here
Monday, May 23, 2011
"Extreme" conditions could cause U.S. food prices to explode this summer
From The Daily Crux:
A rare combination of U.S. weather extremes -- drought in the wheat-growing south and floods in the Midwestern corn belt -- could cause a serious shortage of grains this summer... which would push soaring food costs even higher.
Farmers won't know how serious the problems are for a couple months, so price increases are unlikely before July. But because corn and wheat are used to produce so many food products -- like flour, corn syrup, oil, cereals, and meat -- any price increases could mean a big bump in your total grocery bill.
Fortunately, it's early... so there's still a chance the weather could improve and supplies won't be as depressed as expected.
Read full article...
More on agriculture:
A huge buying opportunity could be setting up in these food commodities
AGFLATION: Shocking food and commodity inflation could be coming soon
Forget gold... One of America's favorite commodities is headed to all-time highs
View the original article here
A rare combination of U.S. weather extremes -- drought in the wheat-growing south and floods in the Midwestern corn belt -- could cause a serious shortage of grains this summer... which would push soaring food costs even higher.
Farmers won't know how serious the problems are for a couple months, so price increases are unlikely before July. But because corn and wheat are used to produce so many food products -- like flour, corn syrup, oil, cereals, and meat -- any price increases could mean a big bump in your total grocery bill.
Fortunately, it's early... so there's still a chance the weather could improve and supplies won't be as depressed as expected.
Read full article...
More on agriculture:
A huge buying opportunity could be setting up in these food commodities
AGFLATION: Shocking food and commodity inflation could be coming soon
Forget gold... One of America's favorite commodities is headed to all-time highs
View the original article here
Sunday, May 22, 2011
It could be really hard to make money in the markets this year
From Expected Returns:
I think we're entering a period where it will be very hard to make a return. This is not necessarily because asset prices won't go up, because they will. It's just that volatility is going to be substantial as the big money unloads their inventory of government bonds. Just as in the recent spike rally in silver, a lot of people will find themselves buying when they should be selling, and selling when they should be buying.
I am fascinated by bubbles because it so aptly demonstrates human nature. At bubble tops, every single person who has ever considered buying an asset finally buys. From my own personal experience, I know many people who have been on the brink of buying gold and silver for...
Read full article...
More on the markets:
Pimco's largest "stock" holding might surprise you
These market "generals" are sending a serious warning
Why the price of silver is the last thing you should worry about
View the original article here
I think we're entering a period where it will be very hard to make a return. This is not necessarily because asset prices won't go up, because they will. It's just that volatility is going to be substantial as the big money unloads their inventory of government bonds. Just as in the recent spike rally in silver, a lot of people will find themselves buying when they should be selling, and selling when they should be buying.
I am fascinated by bubbles because it so aptly demonstrates human nature. At bubble tops, every single person who has ever considered buying an asset finally buys. From my own personal experience, I know many people who have been on the brink of buying gold and silver for...
Read full article...
More on the markets:
Pimco's largest "stock" holding might surprise you
These market "generals" are sending a serious warning
Why the price of silver is the last thing you should worry about
View the original article here
Tuesday, May 17, 2011
Why the price of silver is the last thing you should worry about
By Jeff Clark, editor of Casey's BIG GOLD:
I heard some disturbing reports about silver supply last month that I felt every investor should know.
And while precious metals are currently in correction mode, the long-term concerns with supply won't disappear anytime soon. In attempt to get a handle on the bullion market, I spoke to Andy Schectman of Miles Franklin, who has contacts that run deep in the industry. What he sees everyday might just compel you to count how many ounces you own…
Jeff Clark: Andy, tell us about your industry contacts and how you get the information you're privy to.
Andy Schectman: We source our product from three of the largest six primary U.S. mint distributors. Having 20 years of experience with these sources, as well as the dealers in the secondary market, we're as tied into the industry as anyone.
Jeff: You made some interesting comments to me about...
View the original article here
I heard some disturbing reports about silver supply last month that I felt every investor should know.
And while precious metals are currently in correction mode, the long-term concerns with supply won't disappear anytime soon. In attempt to get a handle on the bullion market, I spoke to Andy Schectman of Miles Franklin, who has contacts that run deep in the industry. What he sees everyday might just compel you to count how many ounces you own…
Jeff Clark: Andy, tell us about your industry contacts and how you get the information you're privy to.
Andy Schectman: We source our product from three of the largest six primary U.S. mint distributors. Having 20 years of experience with these sources, as well as the dealers in the secondary market, we're as tied into the industry as anyone.
Jeff: You made some interesting comments to me about...
View the original article here
Wednesday, May 11, 2011
How the U.S. government could seize your retirement accounts
From Sovereign Man:
Following in the footsteps of a rather ignominious list of nations like Argentina and Hungary, the government of lreland is set to take its 'fair share' of private retirement funds.
Drowning in debt and faced with unpopular, unrealistic, ridiculously unpopular austerity measures, the government has announced that it will now tax private pension savings in order to raise 470 million euros (roughly $675 million) per year… a lot of money in a country of only 4.4 million people.
Somehow, the government expects to be able to create 100,000 jobs to bring down an unemployment rate at 14.7%. Perhaps they plan on hiring 100,000 new workers to go around the country and collect the tax.
It reminds me of what I saw in Bolivia a couple of weeks ago – there's a tax or toll or fee for nearly everything you do. Driving on the highway (if you can call it that) outside of Santa Cruz, you pay a toll… obviously not for the maintenance of the road, but to pay the salary of the toll collector.
At the airport, you have to pay an airport tax before departure… obviously not for the upkeep and efficiency of the airport (it took two hours to make it to my gate), but to pay the salaries of the guys who collect the airport tax.
This is what politicians consider 'job creation,' yet these positions only serve to destroy value. That they would stick up the retirement funds of hard working people is even more immoral.
Here's the best part, though. If you are...
Read full article...
More on the "End of America":
The best places to live during the "End of America"
Jim Rogers: U.S. "certain" to lose AAA credit rating
Porter Stansberry: My worst predictions are now coming true
View the original article here
Following in the footsteps of a rather ignominious list of nations like Argentina and Hungary, the government of lreland is set to take its 'fair share' of private retirement funds.
Drowning in debt and faced with unpopular, unrealistic, ridiculously unpopular austerity measures, the government has announced that it will now tax private pension savings in order to raise 470 million euros (roughly $675 million) per year… a lot of money in a country of only 4.4 million people.
Somehow, the government expects to be able to create 100,000 jobs to bring down an unemployment rate at 14.7%. Perhaps they plan on hiring 100,000 new workers to go around the country and collect the tax.
It reminds me of what I saw in Bolivia a couple of weeks ago – there's a tax or toll or fee for nearly everything you do. Driving on the highway (if you can call it that) outside of Santa Cruz, you pay a toll… obviously not for the maintenance of the road, but to pay the salary of the toll collector.
At the airport, you have to pay an airport tax before departure… obviously not for the upkeep and efficiency of the airport (it took two hours to make it to my gate), but to pay the salaries of the guys who collect the airport tax.
This is what politicians consider 'job creation,' yet these positions only serve to destroy value. That they would stick up the retirement funds of hard working people is even more immoral.
Here's the best part, though. If you are...
Read full article...
More on the "End of America":
The best places to live during the "End of America"
Jim Rogers: U.S. "certain" to lose AAA credit rating
Porter Stansberry: My worst predictions are now coming true
View the original article here
A BULLISH SIGN FROM THE TRANSPORTS
If you're looking for confirmation of a "bullish on stocks" stance right now, make sure to check out the Dow Jones Transportation Average…
More than 100 years ago, Wall Street Journal founder Charles Dow set the foundation of modern technical analysis – the "art" of watching stock price trends.
One of Dow's major tenets holds that the stock market is healthy when both the manufacturers of goods and the transporters of goods are doing brisk business and enjoying rising stock prices. Dow called it a "confirmation" when his Industrial Average and Transportation Average reached new highs together.
Below is a chart of the price action in the Dow Jones Transportation Average over the past year. This index measures the stock price performance of America's most important railroad, trucking, and shipping firms. As you can see, this index is enjoying a bullish series of "higher highs and higher lows" and is sitting near its yearly high.
Sure, there are many things out there to worry about (government debt and government debt being the two biggest), but until major indexes like the Dow Transports start breaking down, we have to say, "Things can't be all that bad."
Tuesday, May 10, 2011
| |||
| The breakdown in copper last week is a bad sign for stock prices. Copper and the S&P 500 have been trading in tandem for the past few years. In fact, the price of copper seems to lead stock prices by about two weeks. Traders can use the action in copper to gauge buy and sell signals for stocks. I wrote about this relationship several weeks ago. Back then, the S&P 500 had just suffered a sharp correction. But copper was bouncing off its lows. That was a good indication the stock market correction had run its course. Here's what I wrote at the time… If you want to know where stocks are headed next, keep an eye on the chart of copper. Right now, copper's bumping into resistance near 440. If it breaks above that level, it should be able to challenge its February highs, and stocks should continue to rally. On the other hand, if resistance holds, support at 420 becomes the critical level. But if copper fails to hold at support, the rally in stocks should fail as well. Copper didn't hold up. It broke below critical support at 420 and is now resting on secondary support near 400. Take a look at this updated chart…  This is a bad sign for stocks. With copper now trading below its March-correction low, the S&P is likely to follow suit. In other words, last week's selloff in stocks isn't just a one- or two-day affair. It's probably the start of a several-week correction that should push the S&P 500 below its March low of 1,254. Based on the following chart, 1,225 looks like a reasonable downside target…  Stocks have bounced a bit over the past couple days. And there may be a little more upside to the bounce – if only to work off the oversold condition created by last week's decline. But unless copper rallies hard immediately, traders should sell stocks into any strength and use this as an opportunity to add short-side exposure. It looks like there's more downside ahead for the stock market. Best regards and good trading, Jeff Clark |
Monday, May 9, 2011
This new ETF could be one of the few set to surge higher now
From OilPrice.com:
When you look at the profusion of new ETFs being launched today, you find that they almost always correspond with market tops. The higher the market, the greater the demand for the underlying, and the more leverage traders bay for it. The resulting returns for investors are disastrous.
But occasionally a blind squirrel finds an acorn, and if you fire buckshot long enough, you hit a barn. That was the case a year ago when the corn ETF was launched (CORN), after five months of stagnant performance by the grain. I smelled a bargain for my readers, piled them into the ETF the day it launched, and caught a quick double in six weeks, just as the Russian fires were igniting.
I think that we are about to see a replay with the new...
Read full article...
More on ETFs:
ETFs could be much riskier than you think
These ETFs can be a valuable tool for contrarian investors
The pros and cons of the five most popular commodity investments
View the original article here
When you look at the profusion of new ETFs being launched today, you find that they almost always correspond with market tops. The higher the market, the greater the demand for the underlying, and the more leverage traders bay for it. The resulting returns for investors are disastrous.
But occasionally a blind squirrel finds an acorn, and if you fire buckshot long enough, you hit a barn. That was the case a year ago when the corn ETF was launched (CORN), after five months of stagnant performance by the grain. I smelled a bargain for my readers, piled them into the ETF the day it launched, and caught a quick double in six weeks, just as the Russian fires were igniting.
I think that we are about to see a replay with the new...
Read full article...
More on ETFs:
ETFs could be much riskier than you think
These ETFs can be a valuable tool for contrarian investors
The pros and cons of the five most popular commodity investments
View the original article here
Wednesday, May 4, 2011
Marc Faber: Sharp correction coming this month
From Newsmax:
Contrarian investor Marc Faber says stocks will fall sharply in May, turning the recent breakout in stocks into a trap for the bulls.
Contrarian investor Marc Faber says stocks will fall sharply in May, turning the recent breakout in stocks into a trap for the bulls.
The markets are due for a correction, and the technicals point to a weak market, Faber tells Wall Street Pit. In particular, he points to the decline in new 52-week highs as evidence of an unhealthy internal market.
Right now, Faber advises investors determined to buy stocks to stay away from cyclicals, tech stocks, and banks... sticking with...
Read full article...
More from Marc Faber:
Marc Faber: This is the "end game"
Marc Faber: Sell stocks now... buy this instead
"Dr. Doom" Marc Faber shocks CNBC anchor with rant on poor people
Monday, May 2, 2011
While most of the world rallies, two of the most important markets are quietly diverging
From Pragmatic Capitalism:
While the markets have continued to melt higher on the hopes of perpetual Fed easing and "better than expected" earnings, some interesting divergences are occurring.
In particular, copper prices and the Shanghai Composite are in retreat. The Shanghai Index has proven to be a particularly good leading index in recent years. While the recent divergence is...
Read full article...
More Cruxallaneous:
Porter Stansberry: My worst predictions are now coming true
Financial "D-Day" is coming in two months... Here's what to do
Listen to Jim Rogers... The big fortunes of the next 20 years will be made here
View the original article here
While the markets have continued to melt higher on the hopes of perpetual Fed easing and "better than expected" earnings, some interesting divergences are occurring.
In particular, copper prices and the Shanghai Composite are in retreat. The Shanghai Index has proven to be a particularly good leading index in recent years. While the recent divergence is...
Read full article...
More Cruxallaneous:
Porter Stansberry: My worst predictions are now coming true
Financial "D-Day" is coming in two months... Here's what to do
Listen to Jim Rogers... The big fortunes of the next 20 years will be made here
View the original article here
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