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Gold Explodes. Euro starts down hard again. Update May 13, 2010
Marc’s Notes:
The markets rebounded off the morbid 1000 point Thursday and investors now ponder the reality that perhaps these markets are really not for all your retirement funds. The stop-out fiasco that sold investors stocks at ultra low prices because of a market glitch is outrageous. Some investors who had stops (automatic sell points) got their stocks sold at a penny, only to see the same stock back at 45 dollars a few minutes later, yet they had lost all their money. Cases like this will surface in the news as the weeks roll by. I now recommend removing most of your stops on big stocks like GE and IBM and Apple and RIMM because those are the stocks that were affected the most. It is a sad day when what we thought normal markets safeguards no longer function. You can guess who made out like bandits on this last go around. The banks and brokerage houses.
These markets are now bordering on laughable.
The 2 largest brokerage firms “turned banks” reported they made money EVERY SINGLE day in the first quarter of 2010. None other then GOLDMAN SACHS and JP MORGAN reported a perfect record of no losses on any of the 90 days. This is rarer then a Steak Tartar side dish and about as likely as a bowling ball going through the eye of a needle.
How did they do it? Ha. These guys are official “banks” now thanks to Obama’s team so they get free money. But since Clintons team and Greenspan eliminated the GLASS STEAGAL act that prevented banks from gambling with deposits, these 2 firms just borrow free money from the FED and the loan it to the TREASURY at 3 % higher for a no risk guaranteed profit. Not too hard to figure out. They also buy stocks and short gold with Government guarantees of no loss. They do this as the Governments “market manipulator” arm.
Meanwhile, Obama’s team again pulls his “Muslim Roots” video from U TUBE and Fed Chief Ben Bernanke uses lobbyists for the first time in history to get Congressman Ron Paul’s “Audit the Fed” bill watered down to a one time disclosure instead of an ongoing oversight. Chris Dodd pretends to want to audit the FED but these guys dilute the bill as to be no longer effective but still appear to be the people’s champion. Turns out all the Congressmen that voted against a full audit got 50% more money in bank campaign money or something like that. The banks spent over 5 million dollars lobbying against this bill as far as we know and continue to do so. The Federal Reserve, as mentioned above, for the first time in history hired lobbyists to defeat the “Audit the Fed” bill in its original form. What we will end up is with a bill that takes a quick peek and that’s all and we cant verify what it finds anyway. This whole thing is a disgrace to America.
Bailouts, buy outs, socialism, entitlements, corporate welfare and sticking the taxpayer. That’s what this country has become.
Look to Greece as to our future. Social unrest and calls for more “programs”.
My rally call that “it wont be enough” rings true as the 1 Trillion dollar bailout of the Euro lasted about a day. The Euro again is tanking and is even lower then BEFORE the bailout announced Monday. Meanwhile Gold is skyrocketing AGAIN as investors see that the Greece bailout is taken from the US Federal Reserve handbook where people who borrowed too much debt are bailed out with by giving them more debt. Greece spent too much on credit so let’s give them more credit. Hummm….. what am I missing here? Honest hard working countries and nations now have to pay for those that misspent. Sounds familiar?
Worse yet, the EURO bank was forbidden to buy individual country debt.
This rule was installed so the EURO itself would not be printed or inflated or used to saddle public citizens with other nations debt. Yet, in a heartbeat, the EURO BANK has now agreed to buy Greek bonds and other bonds from the other “in-debt” countries. Now, instead of strengthening those in-debt countries, its weakens the entire body.
Ludicrous.
I am reading more and more opinions that the final money implosion WORLDWIDE may happen sooner then we all expected. Do you really think with debt skyrocketing around the world, its suddenly going to get better?
Use your head. Massive credit use and overspending got us here. Do you think more borrowing and more debt will make it better? This is not rocket science here folks.
What to expect:
You will see more confusion and haggling about the 1 trillion dollar bailout. I told you the EURO bank would violate its own rules and start buying crap bonds like Greek bonds and they did. Just like the FEDS did here. The Euro will not self implode right away because the Central Banks are manipulating that as well but there will be trouble ahead none the less.
The US ponied up about 60 billion or so to give to Greece (did you know that?) even though we don’t have the money ourselves, so just when the FEDS claimed they were starting to pull back on bailouts, out goes another 60 billion. European problems will continue to grow as lending them more money only kicks the can down the road and tomorrow they will owe even more. The US government finally eliminated one of its bailout programs called Credit Swaps a few months back but had to reinstate it again for the Greek bailout. Like I keep saying, they won’t be able to lift any bailout programs.
As they do, the troubles will arise again and they will go right back to more programs. Their talk about phasing out “this and that” out is a bunch of bull. Either their lying or just really stupid.
Adding insult to injury, the Government sponsored lending giants FANNIE MAE and FREDDIE MAC each need about another 8 billion as losses continue to mount, a result of a failed business model. That model is to loan money to people who cant afford to pay them back because the government tells you to and wants to keep the house market from collapsing. So now these 2 government owned enterprises make 95 % of the home loans in the USA because no one else will so you can expect the losses to continue. Recall on Christmas Eve the Government announced it lifted its 400 billion dollar limit on bailout money to these entities and changed it to UNLIMITED amounts. These 2 firms get as much money as they want to pay for their losses. In other words, you pay so other people can own a home.
Nice, eh? And by the way, 20 % of them are defaulting, and as home prices continue down, more “underwater” home owners will walk away, sticking us taxpayers with the bill.
Recent reports show consumer spending up a tad. The real reason is now that people are purposely defaulting on their home loans, they are taking that money and spending it around town.
GREAT!
For the first time in history, people are making their credit card payments BEFORE their mortgage payments, verified by a recent US NEWS report.
(http://finance.yahoo.com/news/Forget-the-Mortgage-Im-Paying-usnews-816222158.html?x=0&.v=2)
Oh the irony.
Here is what we will see in the next few months.
Look for stalling home prices soon with a return to an acceleration down in prices. Expect about another 20 to 30% down in home prices unless inflation really heats up.
Look for the government bailouts and programs to wind down only to return as the economy slows again in a month or 2 after phase out.
Look for no real improvement in unemployment.
Look for inflation news to increase and prices to continue up.
Look for more EURO problems with more talk about other countries getting in trouble.
Look for more talk about a VALUE ADDED U.S NATIONAL TAX from Washington.
Look for more spin about how things are getting better yet you won’t see it yourself.
Look for more volatility in the markets with a probable “hard down” phase soon.
Gold may explode in the next few weeks. We will see. Like I said in the last 6 updates, gold was looking very strong since March.
Holdings:
Gamblers add USO here in the 35 or under range. Add options on TBT, calls 6 months out or more. Sell on any quick pop. Ditto with the USO play above.
Long term investors add TBT anywhere under 45. This is an interest rate fund.
Those holding large amounts of gold stocks or gold coins, take some profits OFF the table anywhere in here. I will be selling a few coins to go on vacation sometime.
Those not holding much physical gold, always continue to accumulate and don’t worry about price.
Dividend payers: our smaller stocks shouldn’t experience stop problems so keep stops in place 10 % under current prices. Other stocks should have their stops removed due to the last fiasco.
Contrary funds- Add
Natural Gas- Add
Swiss Annuities- Add. Get some money the hell out of US before it’s too late.
US bank accounts- Still ok for now and most of your money should be here anyway.
Foreign Currency funds- Still no word from EVERBANK on a new foreign currency CD. Hold and add FXA and FXC for now and wait to hear from me.
My Dream Portfolio lays out what you should do and is only $29.00. I recommend getting it and following it. It’s easy to use and understand and if you buy it and have a question, email me and I will answer you. If you go to the year subscription, you get all the updates for a full year as well as all shows and the Super Dividend Payers list. (We will be updating that again this month).
Money Matters T Shirts are sold at cost and are just way too cool. Check it out on the menu bar.
In conclusion, these markets are at ORANGE ALERT and should not be taken lightly. Did you see how fast it happened last week? One day you are ok, the next day you lose your stocks at a penny. Like I say, get though the door before the stampede starts and prepare now. These panics are not full blown and on going now so they are your warning to do something now and get prepared before its too late. They are a GIFT! Use them to GET MOVING!
Marc
The markets rebounded off the morbid 1000 point Thursday and investors now ponder the reality that perhaps these markets are really not for all your retirement funds. The stop-out fiasco that sold investors stocks at ultra low prices because of a market glitch is outrageous. Some investors who had stops (automatic sell points) got their stocks sold at a penny, only to see the same stock back at 45 dollars a few minutes later, yet they had lost all their money. Cases like this will surface in the news as the weeks roll by. I now recommend removing most of your stops on big stocks like GE and IBM and Apple and RIMM because those are the stocks that were affected the most. It is a sad day when what we thought normal markets safeguards no longer function. You can guess who made out like bandits on this last go around. The banks and brokerage houses.
These markets are now bordering on laughable.
The 2 largest brokerage firms “turned banks” reported they made money EVERY SINGLE day in the first quarter of 2010. None other then GOLDMAN SACHS and JP MORGAN reported a perfect record of no losses on any of the 90 days. This is rarer then a Steak Tartar side dish and about as likely as a bowling ball going through the eye of a needle.
How did they do it? Ha. These guys are official “banks” now thanks to Obama’s team so they get free money. But since Clintons team and Greenspan eliminated the GLASS STEAGAL act that prevented banks from gambling with deposits, these 2 firms just borrow free money from the FED and the loan it to the TREASURY at 3 % higher for a no risk guaranteed profit. Not too hard to figure out. They also buy stocks and short gold with Government guarantees of no loss. They do this as the Governments “market manipulator” arm.
Meanwhile, Obama’s team again pulls his “Muslim Roots” video from U TUBE and Fed Chief Ben Bernanke uses lobbyists for the first time in history to get Congressman Ron Paul’s “Audit the Fed” bill watered down to a one time disclosure instead of an ongoing oversight. Chris Dodd pretends to want to audit the FED but these guys dilute the bill as to be no longer effective but still appear to be the people’s champion. Turns out all the Congressmen that voted against a full audit got 50% more money in bank campaign money or something like that. The banks spent over 5 million dollars lobbying against this bill as far as we know and continue to do so. The Federal Reserve, as mentioned above, for the first time in history hired lobbyists to defeat the “Audit the Fed” bill in its original form. What we will end up is with a bill that takes a quick peek and that’s all and we cant verify what it finds anyway. This whole thing is a disgrace to America.
Bailouts, buy outs, socialism, entitlements, corporate welfare and sticking the taxpayer. That’s what this country has become.
Look to Greece as to our future. Social unrest and calls for more “programs”.
My rally call that “it wont be enough” rings true as the 1 Trillion dollar bailout of the Euro lasted about a day. The Euro again is tanking and is even lower then BEFORE the bailout announced Monday. Meanwhile Gold is skyrocketing AGAIN as investors see that the Greece bailout is taken from the US Federal Reserve handbook where people who borrowed too much debt are bailed out with by giving them more debt. Greece spent too much on credit so let’s give them more credit. Hummm….. what am I missing here? Honest hard working countries and nations now have to pay for those that misspent. Sounds familiar?
Worse yet, the EURO bank was forbidden to buy individual country debt.
This rule was installed so the EURO itself would not be printed or inflated or used to saddle public citizens with other nations debt. Yet, in a heartbeat, the EURO BANK has now agreed to buy Greek bonds and other bonds from the other “in-debt” countries. Now, instead of strengthening those in-debt countries, its weakens the entire body.
Ludicrous.
I am reading more and more opinions that the final money implosion WORLDWIDE may happen sooner then we all expected. Do you really think with debt skyrocketing around the world, its suddenly going to get better?
Use your head. Massive credit use and overspending got us here. Do you think more borrowing and more debt will make it better? This is not rocket science here folks.
What to expect:
You will see more confusion and haggling about the 1 trillion dollar bailout. I told you the EURO bank would violate its own rules and start buying crap bonds like Greek bonds and they did. Just like the FEDS did here. The Euro will not self implode right away because the Central Banks are manipulating that as well but there will be trouble ahead none the less.
The US ponied up about 60 billion or so to give to Greece (did you know that?) even though we don’t have the money ourselves, so just when the FEDS claimed they were starting to pull back on bailouts, out goes another 60 billion. European problems will continue to grow as lending them more money only kicks the can down the road and tomorrow they will owe even more. The US government finally eliminated one of its bailout programs called Credit Swaps a few months back but had to reinstate it again for the Greek bailout. Like I keep saying, they won’t be able to lift any bailout programs.
As they do, the troubles will arise again and they will go right back to more programs. Their talk about phasing out “this and that” out is a bunch of bull. Either their lying or just really stupid.
Adding insult to injury, the Government sponsored lending giants FANNIE MAE and FREDDIE MAC each need about another 8 billion as losses continue to mount, a result of a failed business model. That model is to loan money to people who cant afford to pay them back because the government tells you to and wants to keep the house market from collapsing. So now these 2 government owned enterprises make 95 % of the home loans in the USA because no one else will so you can expect the losses to continue. Recall on Christmas Eve the Government announced it lifted its 400 billion dollar limit on bailout money to these entities and changed it to UNLIMITED amounts. These 2 firms get as much money as they want to pay for their losses. In other words, you pay so other people can own a home.
Nice, eh? And by the way, 20 % of them are defaulting, and as home prices continue down, more “underwater” home owners will walk away, sticking us taxpayers with the bill.
Recent reports show consumer spending up a tad. The real reason is now that people are purposely defaulting on their home loans, they are taking that money and spending it around town.
GREAT!
For the first time in history, people are making their credit card payments BEFORE their mortgage payments, verified by a recent US NEWS report.
(http://finance.yahoo.com/news/Forget-the-Mortgage-Im-Paying-usnews-816222158.html?x=0&.v=2)
Oh the irony.
Here is what we will see in the next few months.
Look for stalling home prices soon with a return to an acceleration down in prices. Expect about another 20 to 30% down in home prices unless inflation really heats up.
Look for the government bailouts and programs to wind down only to return as the economy slows again in a month or 2 after phase out.
Look for no real improvement in unemployment.
Look for inflation news to increase and prices to continue up.
Look for more EURO problems with more talk about other countries getting in trouble.
Look for more talk about a VALUE ADDED U.S NATIONAL TAX from Washington.
Look for more spin about how things are getting better yet you won’t see it yourself.
Look for more volatility in the markets with a probable “hard down” phase soon.
Gold may explode in the next few weeks. We will see. Like I said in the last 6 updates, gold was looking very strong since March.
Holdings:
Gamblers add USO here in the 35 or under range. Add options on TBT, calls 6 months out or more. Sell on any quick pop. Ditto with the USO play above.
Long term investors add TBT anywhere under 45. This is an interest rate fund.
Those holding large amounts of gold stocks or gold coins, take some profits OFF the table anywhere in here. I will be selling a few coins to go on vacation sometime.
Those not holding much physical gold, always continue to accumulate and don’t worry about price.
Dividend payers: our smaller stocks shouldn’t experience stop problems so keep stops in place 10 % under current prices. Other stocks should have their stops removed due to the last fiasco.
Contrary funds- Add
Natural Gas- Add
Swiss Annuities- Add. Get some money the hell out of US before it’s too late.
US bank accounts- Still ok for now and most of your money should be here anyway.
Foreign Currency funds- Still no word from EVERBANK on a new foreign currency CD. Hold and add FXA and FXC for now and wait to hear from me.
My Dream Portfolio lays out what you should do and is only $29.00. I recommend getting it and following it. It’s easy to use and understand and if you buy it and have a question, email me and I will answer you. If you go to the year subscription, you get all the updates for a full year as well as all shows and the Super Dividend Payers list. (We will be updating that again this month).
Money Matters T Shirts are sold at cost and are just way too cool. Check it out on the menu bar.
In conclusion, these markets are at ORANGE ALERT and should not be taken lightly. Did you see how fast it happened last week? One day you are ok, the next day you lose your stocks at a penny. Like I say, get though the door before the stampede starts and prepare now. These panics are not full blown and on going now so they are your warning to do something now and get prepared before its too late. They are a GIFT! Use them to GET MOVING!
Marc
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