Why the Bank of Japan’s Economic Stimulus is good for the Gold Price
Exchange Rate Determination Rules
If no one objects to this, then a tacit approval of this policy is being given. If this is the case, then you can be sure that other major nations will follow suit. What of price stability and exchange rates that accurately reflect the Balance of Payments of a nation. To understand the importance of these issues we take you back to the last time you heard the U.S. complain about the undervaluation of the Chinese Yuan. It is perceived by many in government and in both parties that the Chinese are manipulating their currency to gain advantage in international trade and this is making many people angry.
Gold & Investment in Failure
by Jim Willie on Thursday, 2 Sep 2010
Many observers to the wild gyrations, deep contortions, extreme measures, and other bizarre activity in the government and banking arenas are suffering from severe confusion. The public is alarmed, even frightened, by the sequence of events, without much benefit of comprehension of what is happening or which clans are in control. The degree of deception hit a peak during the TARP Fund creation and disbursement, done behind private closed doors for the replenishment of sacred preferred stock, that bridge between corporate bonds and stock equity. The deception hit a very high pitch with the financial titan failures, the entire string of them. It has never stopped since. The economic data and promising forecasts (mere marketing group propaganda) featured Green Shoots, Jobless Recovery, and the totally vacant Second Half Recovery that is useful every initial six months to sway the ignorant masses. Just what is happening is difficult to describe succinctly. But the main description reads like an obituary. The most recent and visible distortion is not of price inflation, which has zoomed at 7% annually for a couple years, but rather the Institute of Supply Mgmt. The ISM index has somehow registered a slight increase from July to August, despite almost every single regional index faltering badly. See the careening Philly Fed, from plus 5.1 to minus 7.7 in the latest month. They ignore the weak components and present a distorted aggregate, much like retail sales.
SP500 & Gold At Crucial Pivot Points
By Chris Vermeulen, Thursday, Sept 2
Wednesday was a big session with better than expected manufacturing surging the market 3%. In this article I will do a quick technical take on the current situation for the SP500 and gold as they are both trading at a key resistance level. also its important to know what type of price action we will get in the next 1-2 days so you can have your profit targets or protective stops in place depending on which side of the market you are currently playing.
Jobless Claims Decline, But Still Too High for Major Impact Employment Outlook
New U.S. Weekly Jobless Claims declined last week according to the government, but were still too high to have a strong impact on the weak labor market.
The number was good enough to push Treasury yields slightly higher, driving down December Treasury Bonds. This market has been trading in a tight range for six days indicating impending volatility. On the downside, 130'17 to 129'11 remains a potential downside target. The top at 135'19 seems to be closely guarded at this time.
Velocity–Armageddon Antidotes, & Just Say “No” to 401(k) & IRA Confiscation
DEEPCASTER LLC
www.deepcaster.com
DEEPCASTER FORTRESS ASSETS LETTER
DEEPCASTER HIGH POTENTIAL SPECULATOR
Wealth Preservation Wealth Enhancement
“The crucial passage comes in Chapter 17 entitled "Velocity". Each big inflation -- whether the early 1920s in Germany, or the Korean and Vietnam wars in the US -- starts with a passive expansion of the quantity of money. This sits inert for a surprisingly long time. Asset prices may go up, but latent price inflation is disguised. The effect is much like lighter fuel on a camp fire before the match is struck.
People’s willingness to hold money can change suddenly for a "psychological and spontaneous reason", causing a spike in the velocity of money. It can occur at lightning speed, over a few weeks…
"Velocity took an almost right-angle turn upward in the summer of 1922," said Mr. O Parsson. Reichsbank officials were baffled. They could not fathom why the German people had started to behave differently almost two years after the bank had already boosted the money supply. He contends that public patience snapped abruptly once people lost trust and began to "smell a government rat".
Wall Street vs Washington: Prolonging the Great Recession
Whatever you think of either of these aspiring masters of the universe, this clash of the titans is bad news for the rest of us.
You Dream Of Columbus
By Contrary Investor
Here In This Blue Light Away From the Fireside, Things Can Get Twisted And Haunted And Crowded. You Can't Even Feel Right. So You Dream Of Columbus...Although we're probably talking to ourselves here, clearly one of the toughest things for investors to do really at all points in time is to differentiate between "noise" and important information. For our current generation, maybe this has never been truer than is now the case in the current market environment. Not only has technology upped the ante in a big way in terms of the potential for digital information overload, but real world economic and financial market circumstances in which we now find ourselves are anything but what today's investors have come to know over their careers or really lifetimes for that matter. In terms of potential remediation, we have seen the Fed/Treasury/Administration follow the script of the historical playbook in terms of trying to right the economic ship via fiscal and monetary policy paths similarly taken over the last half century. In fact, it has really been fiscal and monetary policy on steroids that has characterized the current cycle. But as of now, all to no avail as domestic employment, personal income growth and stability in the housing market remain elusive. Add in a good dose of a changed daily market environment vis-à-vis the computerization of "trading" (not investing), and we have the table literally set for emotional and behavioral volatility. Exactly the meal of the moment, no? Of course this is capped off with the convergence of globalization of the economy unlike anything seen in centuries just to keep it all simple, right? A lot to swallow and quite naturally an environment where what would have been historic outcomes that could have been anticipated with at least some degree of confidence in prior economic cycles are anything but certain looking ahead. Can we call it the "new world"?
Being Negative Might Be A Positive
By Michael Ashton
Preliminary: My column from yesterday didn’t get posted in some of the places it usually does. If you missed it, and if you care, you can find it here.
Stocks probed lower again this morning, with the S&P bouncing again off the 1040 mark. I suggested before my vacation that the 1046-1070 range was the “indecision zone,” while below that level it would be obvious to all that further declines are in store. It is starting to look more like the narrower 1040-1046 range is the Maginot line that the bulls are defending and the bears seeking to overrun. The data were supportive at the margin, with Consumer Confidence actually rising – but that was only because the “expectations” component rose from 72.5 from 67.5. The “present situation” component, which is the one that is actually correlated with stuff, fell to 24.9 from 26.4, and the “Jobs Hard To Get” subindex (which is correlated with the Unemployment Rate) rose to 45.7, the highest level since March although the chart below makes it plain that this is better considered to be a range trade itself.
Well, jobs ARE hard to get, after all.
The long end of the yield curve was well-bid out of the gate, and the curve flattened with the 10y yield falling to 2.48%.
Rounding Up the Culprits of Rising Prices
By Mogambu Guru
From Bloomberg.com we get the bad news that "Bank of England Governor Mervyn King said inflation is likely to exceed the UK government's upper 3% limit in coming months as higher sales taxes drive gains in consumer prices," which "rose 3.1% in July from a year earlier after climbing 3.2% in June."
Apparently, he has to write a letter about it, probably something along the lines of "Dear British taxpayer, Our stupidity and incompetence have caused prices to rise more than 3% in a year, which means you are all doomed unless we government lowlife halfwits stop being incompetent, especially as regards monetary policy in general and creating far too much new money in particular, which we won't. Terribly sorry, old chap. Respectfully yours, Mervyn."
A Finger in Every Pie
By JR Nyquist
On 3 December 2007 a curious item appeared in the Russian media. It concerned Igor Ivanovich Sechin, a Russian political figure close to then President Vladimir Putin. Kommersant featured a quote from Oleg Shvartsman, head of the Financial-Industrial Group: "For us, the Party is represented by the power bloc headed by Igor Ivanovich [Sechin]." This statement was offered in response to a journalist's question about Shvartman's strategic task of velvet re-privatization. "Who set this task for you?" asked the journalist. Shvartsman's extraordinary answer slipped inadvertently from his post-Soviet lips: "The party! (laughing)."
