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Dow Cracks under 10,000. Hungary warns of Greece like default! Update June 4, 2010
Marc's Notes:
Hungry anyone?
Actually the PIIGS were! PIIGS meaning Portugal, Italy, Ireland, Greece and Spain. These 5 are called PIIGS as they are the EURO currency countries that are in bad shape debt wise (beside US) and Greece was the most visible.
Well, don’t look now but the debt “disease” is spreading like I told you it would. This morning HUNGARY came out and said it might default. Wow, they weren’t even on the list! Just goes to show there is never just one cockroach. The debt disease started with homeowners, then to companies, then to our banking system and now is in entire countries! This HUNGRAY news pounded the EURO again under 120 per US DOLLAR and aren’t you glad I told you to get OUT OF THE EURO last year.
You can expect an even more aggressive money printing plan by the European Central planners, violating their own rules by bailing out countries, as the EURO contagion makes its way into other hosts.
This is a microcosm of paper currencies gone bad, as the governments of the world have printed so much money, and the banks have grown so large with it, the whole system is regurgitating this violation of natures money system, a system of honest weights and measures, thrown asunder by Federal Reserve Banks of the world and spend happy politicians, goaded on by do-gooders, would be “world improvers”, socialists and the so called “compassionate ones”. These economically challenged individuals think spending government money to “help” people improve things. In reality, government spending causes MORE people to go into poverty as the money the government spends is:
1) stolen from those that produce
2) given to those that don’t
3) incentivizes people who work to not work as hard as their fruits are stolen though taxation
4) incentivizes people NOT to work as they get paid for not working
5) causes inflation which drives the poor poorer, and causes subsequent classes to drop down another level
6) increases the size of government (who produce nothing)
7) increases the cost to the rest of us as the governments workers require salaries and benefits
8) increases taxes which increases costs to business so they employ less workers and raise the selling prices of their goods
9) keeps these spending politicians in office as the poor constituency vote for them as they spend money on these same poor folks
Likewise minimum wages actually cause more unemployment as the “going” wage paid for by private business is circumvented by the “enforced” minimum wage, therefore driving the cost to produce higher then the market price of the good sold would dictate. This causes higher costs in relation to profit which causes business to sell less, produce less and subsequently fire workers. This also results in less tax revenue which exasperates the problem even more.
The seduction of trying to “help” actually HURTS the very same people these do-gooders try to help. One of the main reasons for this lack of foresight by our politicians is because most of these guys and gals never had to run a business. They are career politicians, retired homemakers, lawyers or school administrators. Just look at Obama. He was a student turned activist turned politician. Ben Bernanke was a teacher. Pelosi, a grandmother, Feinstein the wife of a millionaire. The list goes on. If a private business was run like the governments of the world, they would be broke, AS THEY SHOULD BE.
The markets are testing 10,000 DOW and with every retest it gets closer to a breakdown.
Today brought the crackdown and it closed in the 9,950 DOW range. The question is what will happen Monday. If it can’t rise back above 10,000 DOW then the 9000’s come into play and 10,000 becomes the new resistance. Monday will be the key and I suspect the FEDS will be in there Sunday night trying to goose the futures market.
I laugh when I read these guys saying a recovery will drive the market higher in the next year or so. The ONLY reason we have any positive numbers at all is 5 or 6 trillion worth of government spending. Money given to the banks was used by the banks to gamble up the stock market. Now insiders are selling stock like crazy and this bodes for more down drafts in the days and weeks to come. Bonds are tanking again as banks are now becoming even more hesitant to lend to each other and here we go again.
Back on the farm, gold is holding remarkable well in spite of all this, silver not so well. The reason for that is easy. Silver is regarded somewhat as an industrial metal and gold is a chaos hedge. Silver will go down with market for a while but will eventually catch back up to its normal ratio with gold as people flee to silver as the poor mans gold. In keeping with my mantra that all stocks go down or up together regardless of the underlying asset, gold stocks were soft even though gold was up. This is why I have you hold physical gold instead of just gold stocks.
The US dollar is strengthening again as it is STILL (incredibly) the perceived asset of safety, but that will change eventually and when THAT happens, that will really be the flame that starts the final fire of volatility. Pray that day never comes but I know it will. The US is just about the worst debtor in the world, worse then GREECE on most levels, so that’s pretty much a done deal.
For now, expect more headlines on these mysterious “created” jobs that seem nowhere to be found. Most of the new jobs in the last report were census jobs. Obama spun this today as positive but Wall Street knew better. Even NBC tonight noticed the jobs report and the census being a big part of it. GOOD GOING NBC! Someone in their news room has a brain!
The government now is responsible for about one third of all spending in the US.
ONE THIRD!
Does anyone see the flaw in this? Since the governments sell nothing, it must either take the money from you or print it. If they print it, it takes the money from you anyway through inflation so basically they spend your money, but are much less efficient at spending it, therefore most of it goes wasted. Wasted at a time when we need it the most. Those of you that believe we needed this government stimulus to rescue the economy, you are about to learn a hard lesson. It doesn’t work, it won’t work, and you will see that soon. The FEDS will probably think they didn’t spend enough and try even more spending. They will never learn. Expect more “ANNOUNCEMENTS” about new spending, new stimulus plans, and more bailouts being required. The US meanwhile swapped US dollars for EUROS last week or 2 back to give the Euro bank good dollars in exchange for the crappy Euro. Now guess what! Since the EURO has crashed even more and we now hold a ton of them, we LOST MONEY. Our Central bank traded our good US DOLLAR for this falling currency and in a time when we need all the money we can get! Shame on Ben Bernanke for using our money to bailout EUROPE. What about us Americans!
You will now see reality in the jobs market and the spin about this recovery beginning to be questioned soon. The sad part is that investors believed these guys in the first place and now are being set up for more losses.
Hold to our core portfolio plan, keep most your money safe and in foreign currencies and gold. Use your stops to protect your assets and keep alert. This thing is probably about to get ugly. RED ALERT remains for the market.
The US COMPTROLLER interview show is FREE on the website under FREE SHOW for about 2 more weeks. Then we will remove it and replace it with SHOULD YOU STOP PAYING YOUR HOME MORTGAGE. Download the US COMPTROLLER interview why you still can. It is the head accountant of the US GOVERNMENT telling us like it is. He mirrors this newsletters predictions by the way.
Consults are available. They are in person and take about 3.5 hours. Email us if interested.
All for now,
Marc
Hungry anyone?
Actually the PIIGS were! PIIGS meaning Portugal, Italy, Ireland, Greece and Spain. These 5 are called PIIGS as they are the EURO currency countries that are in bad shape debt wise (beside US) and Greece was the most visible.
Well, don’t look now but the debt “disease” is spreading like I told you it would. This morning HUNGARY came out and said it might default. Wow, they weren’t even on the list! Just goes to show there is never just one cockroach. The debt disease started with homeowners, then to companies, then to our banking system and now is in entire countries! This HUNGRAY news pounded the EURO again under 120 per US DOLLAR and aren’t you glad I told you to get OUT OF THE EURO last year.
You can expect an even more aggressive money printing plan by the European Central planners, violating their own rules by bailing out countries, as the EURO contagion makes its way into other hosts.
This is a microcosm of paper currencies gone bad, as the governments of the world have printed so much money, and the banks have grown so large with it, the whole system is regurgitating this violation of natures money system, a system of honest weights and measures, thrown asunder by Federal Reserve Banks of the world and spend happy politicians, goaded on by do-gooders, would be “world improvers”, socialists and the so called “compassionate ones”. These economically challenged individuals think spending government money to “help” people improve things. In reality, government spending causes MORE people to go into poverty as the money the government spends is:
1) stolen from those that produce
2) given to those that don’t
3) incentivizes people who work to not work as hard as their fruits are stolen though taxation
4) incentivizes people NOT to work as they get paid for not working
5) causes inflation which drives the poor poorer, and causes subsequent classes to drop down another level
6) increases the size of government (who produce nothing)
7) increases the cost to the rest of us as the governments workers require salaries and benefits
8) increases taxes which increases costs to business so they employ less workers and raise the selling prices of their goods
9) keeps these spending politicians in office as the poor constituency vote for them as they spend money on these same poor folks
Likewise minimum wages actually cause more unemployment as the “going” wage paid for by private business is circumvented by the “enforced” minimum wage, therefore driving the cost to produce higher then the market price of the good sold would dictate. This causes higher costs in relation to profit which causes business to sell less, produce less and subsequently fire workers. This also results in less tax revenue which exasperates the problem even more.
The seduction of trying to “help” actually HURTS the very same people these do-gooders try to help. One of the main reasons for this lack of foresight by our politicians is because most of these guys and gals never had to run a business. They are career politicians, retired homemakers, lawyers or school administrators. Just look at Obama. He was a student turned activist turned politician. Ben Bernanke was a teacher. Pelosi, a grandmother, Feinstein the wife of a millionaire. The list goes on. If a private business was run like the governments of the world, they would be broke, AS THEY SHOULD BE.
The markets are testing 10,000 DOW and with every retest it gets closer to a breakdown.
Today brought the crackdown and it closed in the 9,950 DOW range. The question is what will happen Monday. If it can’t rise back above 10,000 DOW then the 9000’s come into play and 10,000 becomes the new resistance. Monday will be the key and I suspect the FEDS will be in there Sunday night trying to goose the futures market.
I laugh when I read these guys saying a recovery will drive the market higher in the next year or so. The ONLY reason we have any positive numbers at all is 5 or 6 trillion worth of government spending. Money given to the banks was used by the banks to gamble up the stock market. Now insiders are selling stock like crazy and this bodes for more down drafts in the days and weeks to come. Bonds are tanking again as banks are now becoming even more hesitant to lend to each other and here we go again.
Back on the farm, gold is holding remarkable well in spite of all this, silver not so well. The reason for that is easy. Silver is regarded somewhat as an industrial metal and gold is a chaos hedge. Silver will go down with market for a while but will eventually catch back up to its normal ratio with gold as people flee to silver as the poor mans gold. In keeping with my mantra that all stocks go down or up together regardless of the underlying asset, gold stocks were soft even though gold was up. This is why I have you hold physical gold instead of just gold stocks.
The US dollar is strengthening again as it is STILL (incredibly) the perceived asset of safety, but that will change eventually and when THAT happens, that will really be the flame that starts the final fire of volatility. Pray that day never comes but I know it will. The US is just about the worst debtor in the world, worse then GREECE on most levels, so that’s pretty much a done deal.
For now, expect more headlines on these mysterious “created” jobs that seem nowhere to be found. Most of the new jobs in the last report were census jobs. Obama spun this today as positive but Wall Street knew better. Even NBC tonight noticed the jobs report and the census being a big part of it. GOOD GOING NBC! Someone in their news room has a brain!
The government now is responsible for about one third of all spending in the US.
ONE THIRD!
Does anyone see the flaw in this? Since the governments sell nothing, it must either take the money from you or print it. If they print it, it takes the money from you anyway through inflation so basically they spend your money, but are much less efficient at spending it, therefore most of it goes wasted. Wasted at a time when we need it the most. Those of you that believe we needed this government stimulus to rescue the economy, you are about to learn a hard lesson. It doesn’t work, it won’t work, and you will see that soon. The FEDS will probably think they didn’t spend enough and try even more spending. They will never learn. Expect more “ANNOUNCEMENTS” about new spending, new stimulus plans, and more bailouts being required. The US meanwhile swapped US dollars for EUROS last week or 2 back to give the Euro bank good dollars in exchange for the crappy Euro. Now guess what! Since the EURO has crashed even more and we now hold a ton of them, we LOST MONEY. Our Central bank traded our good US DOLLAR for this falling currency and in a time when we need all the money we can get! Shame on Ben Bernanke for using our money to bailout EUROPE. What about us Americans!
You will now see reality in the jobs market and the spin about this recovery beginning to be questioned soon. The sad part is that investors believed these guys in the first place and now are being set up for more losses.
Hold to our core portfolio plan, keep most your money safe and in foreign currencies and gold. Use your stops to protect your assets and keep alert. This thing is probably about to get ugly. RED ALERT remains for the market.
The US COMPTROLLER interview show is FREE on the website under FREE SHOW for about 2 more weeks. Then we will remove it and replace it with SHOULD YOU STOP PAYING YOUR HOME MORTGAGE. Download the US COMPTROLLER interview why you still can. It is the head accountant of the US GOVERNMENT telling us like it is. He mirrors this newsletters predictions by the way.
Consults are available. They are in person and take about 3.5 hours. Email us if interested.
All for now,
Marc
