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Sunday, May 8, 2011

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saveyourassetsfirst3

Sunday night weirdness?

Posted: 08 May 2011 05:44 AM PDT

OK, the last couple of Sundays were very strange and looked very wrong (rigged?). Looks like the big boys can manipulate quite a bit with minimal trading. Are they using Sundays to confuse the small players?

Think it'll happen again tonight? And what direction? I'd guess upward, but I have no clue.

Thoughts?

joe

What does one trillion dollars look like?

Posted: 08 May 2011 04:32 AM PDT

All this talk about "stimulus packages" and "bailouts"…

A billion dollars…

A hundred billion dollars…

Eight hundred billion dollars…

One TRILLION dollars…

What does that look like?

Starting with with a $100 dollar bill. A $100 dollar bill is currently the largest U.S. denomination in general circulation. Most everyone has seen them, slighty fewer have owned them and they're just about guaranteed to make friends wherever they go.

A packet of one hundred $100 bills is less than 1/2″ thick and contains $10,000. Fits in your pocket easily and is more than enough for week or two of shamefully decadent fun.

Believe it or not, this next little pile is $1 million dollars (100 packets of $10,000). You could stuff that into a grocery bag and walk around with it.

While a measly $1 million looked a little unimpressive, $100 million is a little more respectable. It fits neatly on a standard pallet..

And $1 BILLION dollars… now we're really getting somewhere…

Next we'll look at ONE TRILLION dollars. This is that number we've been hearing so much about. What is a trillion dollars? Well, it's a million million. It's a thousand billion. It's a one followed by 12 zeros.

You ready for this?

It's pretty surprising.

Go ahead…

Scroll down…

Ladies and gentlemen… I give you $1 trillion dollars…

Notice those pallets are double stacked.
…and remember those are $100 bills.

So the next time you hear someone toss around the phrase "trillion dollars"… that's what they're talking about.

~props to pagetutor and FSN

First Fear, Then Anger

Posted: 08 May 2011 03:44 AM PDT

The historic decline this week in silver creates strong emotion. Watching great amounts of wealth disappear, quite literally in minutes amid disorderly trading conditions is a genuine fear for any investor. Worse is seeing no obvious legitimate reason to explain the carnage. If that doesn't scare you, nothing will. Especially if you already harbored unease about how the whole silver market operated.

Silver Market Update

Posted: 08 May 2011 03:42 AM PDT

Silver newbies discovered to their shock and horror last week that silver can actually go down as well as up, and even worse, that it drops a lot faster than it goes up. We were partly fooled ourselves last week by the seemingly bullish COT figures, but not to the extent that it stopped us implementing protection in the form of Puts, or Calls in silver bear ETFs such as ZSL.

Silver still more than double the price of a year ago

Posted: 08 May 2011 03:24 AM PDT

Last week is another for the history books for silver bugs with a record one third price correction in a week. It still falls short of the 52 per cent plunge of the 2008 financial crisis. Silver is notoriously volatile.

Watching Silver Correct

Posted: 08 May 2011 03:17 AM PDT

Three charts are analyzed.

TRANSITION TO THE D-WAVE

Posted: 08 May 2011 01:23 AM PDT

Don't let the title fool you, for reasons I've outlined in this weekend's report I think gold likely has one more move to new highs before the D-wave begins.

However the action in the dollar and silver this week have probably taken the parabolic phase of this C-wave off the table. Rather than the normal sharp spike up it appears that this C-wave is going to end with a more modest move than prior C-waves. That being said it did last much longer and gain just as much above the prior C-wave top as any other C-wave. So in terms of duration and magnitude this C-wave has fulfilled every expectation.

I've noted in the past that a D-wave is a regression to the mean, profit taking event. That regression tends to be most severe when the C-wave ends with a parabolic move. Action and reaction.

However this time it appears there will likely be no parabolic rally to top the C-wave. In that case the D-wave will probably be milder than prior D-waves. As a point of reference every D-wave so far has retraced at least 62% of the prior C-wave advance.


Without the parabolic stretch I think it's likely that the impending D-wave will only retrace roughly 50% of this C-wave. If gold pushes up to a marginal new high slightly above $1600 (in the weekend report), then it will probably only drop to around $1250 which just happens to mark the upper boundary of last summers consolidation zone.


What should follow after that is a fairly strong A-wave surge. A-waves usually test the but don't break to new highs. At that point gold will enter a long sideways period to consolidate the massive gains made during the this last C-wave. During this period it will get very tough to make money in the precious metals market.

However there is still some upside potential once gold puts in the daily cycle low that is trying to form now. Great potential during the D-wave if you know how to use puts and excellent upside potential during the A-wave next fall, before the metals sink into the consolidation doldrums.


This year still has great opportunities left and of course we still have the next C-wave to look forward to in 2013. That one should make this C-wave look puny in comparison.

This posting includes an audio/video/photo media file: Download Now

anyone use Golden state mint in california?

Posted: 08 May 2011 12:58 AM PDT

Im thinking about ordering from them

Martenson Interviews Wiggins on Government Insolvency

Posted: 08 May 2011 12:48 AM PDT

In a podcast, Chris Martenson interviews Addison Wiggins. The following points are explored: His shock, despite releasing numerous works in advance that predicted it, at how quickly our political and financial leadership panicked and abandoned fiscal sanity during the crisis of 2008. Why it may very well be too late to avoid a collapse of [...]

BP's Dudley Gets Bested by Russians Again - At Shareholders' Expense

Posted: 08 May 2011 12:43 AM PDT

MasterPlan Capital submits:

Robert Dudley, the American CEO of BP PLC (NYSE: BP), has requested and received a 1 month extension of the deadline to close the Arctic prospecting joint venture and share swap with Russia's OAO Rosneft. As this $16 billion dollar deal and Dudley's credibility hang in the balance, he'll need more than a month; he'll need a miracle.

There's another Russian partnership involved that simply won't let the deal happen unless it goes directly through them. AA Renova, an investment entity that controls BP's current Russian joint venture, TNK-BP, is using aggressive legal tractates to keep BP and Rosenft from joining forces. They claim that the deal they signed with BP obligates BP to do the Rosneft deal through Renova.

Does it? Who-the-heck knows, but it's tied up in Russian courts and unlikely to be resolved over the course of a 1 month extension that's half over already.

It's clear


Complete Story »

Sowing the Seeds of Stagflation: Eye on Precious Metals, Dollar

Posted: 08 May 2011 12:12 AM PDT

Danny Furman submits:

Historically, stagflation - severe inflation in a stagnant economy - occurs immediately following an intense period of deflation as the economy fails, people lose faith in its currency and flee for alternatives.

Cinco de Mayo was no celebration for commodities, though plenty of analysts have long been calling silver (see here), oil (see here) and other commodity prices in bubbles. Silver was by all means "rejected" at the $50/oz mark last week and continues to plummet, while oil showed resilience until selling began to intensify May 4th. DXY, the US Dollar Index future spot price, rallied hard the final two days of the week, equaling its number of up days in the previous six weeks.

Whether we are seeing bubbles burst or a temporary unwinding of extremely crowded trades, the first week of trading has definitely seen some big players "sell in May." Whether or not asset prices will pack


Complete Story »

Still Holding Silver? Analyzing What's Next

Posted: 07 May 2011 11:31 PM PDT

Aigail Doolittle submits:

Silver Held – What's Next?

There's an interesting opportunity in silver at this moment, but the question is whether it is to the upside, downside or both. Click to enlarge:

Returning to the "held" description above before discussing that opportunity, I am talking about the fact that silver essentially tested a critical level of support found right above $33 per ounce by making a low of about $33.035 on Friday only to bounce and close well above that level.

This is clearly my own generous interpretation, but I count the trading described above as a hold – for one day at least – and despite the fact that silver clearly punched beneath its intermediate-term trendline as shown above due to the fact that silver closed above this trendline as it did in the other two instances when it punctured that trendline slightly as well.

I'm being "generous" here due to


Complete Story »

Australian Government Adds Equinix as Data Center Partner

Posted: 07 May 2011 11:27 PM PDT

Paolo Gorgo submits:

On May 5th, the Australian Government officially announced the addition of two data center providers, Equinix (EQIX) and Australian Data Centres, as chosen vendors to provide data center space to Government agencies.

The new providers join Canberra Data Centre, TransACT, iSeek (Brisbane), Global Switch (Sydney) and Datacom (Sydney) on the panel, and will be competing with them for multi-million dollar outsourcing deals, meant to allow the Government to consolidate most federal agencies into more modern third party facilities.

The news comes a few weeks after Equinix Australia announced that Chi-X Australia selected Equinix's Sydney facility as the primary data center for its matching engine, as we previously commented on Seeking Alpha.

It is interesting to note that both wins will rely on the opening of the new SY3 Sydney facility in mid 2011, that seems to be nicely booked in advance to the official opening.

Here is a quote taken


Complete Story »

Did the Government Cause the Commodity Crash?

Posted: 07 May 2011 11:09 PM PDT

Brian Kelly submits:

No, this is not a post about a conspiracy theory. For everyone looking for that type of information, get in your van and head to Roswell. For all others, read on.

During the financial crisis, the Federal Reserve successfully lobbied for the right to pay banks interest on any reserve balances deposited at the Fed in excess of regulatory capital. While the banks were the beneficiaries, Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB) (GSEs) were not given the privilege of receiving interest on excess reserves. This created an arbitrage opportunity.

The banks have been able to buy excess reserves from the GSE's at the overnight repo rate and then deposit that money with the Fed and earn the Interest on Reserves rate (IOER) - a risk free arbitrage. These deposits at the Fed become part of the banks' balance sheets and can be used to fund things like carry trades,


Complete Story »

Keryx Shares Could Trek Higher on Attractive Pipeline

Posted: 07 May 2011 11:00 PM PDT

VFC submits:


A recent announcement of a stock offering have sent shares of Keryx Pharmaceuticals (KERX) down into the mid four dollar range once again, and, given the late-stage potential of the company, it might be worth taking a look at KERX again.

The company has two Phase III products in the works, both of which hold significant potential on the market, should they make it that far.

Zerenex, as described by the company itself,

is intended to treat high phosphate levels in patients with chronic kidney disease. Keryx is seeking approval to market the drug for use by patients with chronic kidney disease who are not yet on dialysis, and patients with end-stage kidney disease who are undergoing dialysis.

This product is being tested in late stage trials in Japan as well as in the United States, and the company recently received news from regulators in Europe which stated that additional


Complete Story »

Cramer's Lighting Round -Toyota's Quarter Will Be Bad (5/6/11)

Posted: 07 May 2011 10:50 PM PDT

Miriam Metzinger submits:

Stocks discussed on the lightning round session of Jim Camer's Mad Money TV Program, Friday May 6.

Bullish Calls

Toyota (TM): "I think Toyota is a buy ....here is the problem. I want to buy a little bit lower because the quarter is going to be bad."

Manitowoc (MTW): "The quarter was not that hot, but that is an opportunity. I'm a buyer on weakness. People really hated the quarter... they are short-sighted... the crane business is on fire... I would buy Manitowoc."

Barrick Gold (ABX), Goldcorp (GG):


Complete Story »

Trading Comments, 8 May 2011 (posted 12h45 CET):

Posted: 07 May 2011 09:45 PM PDT

Last week's drubbing taken by the precious metals illustrates why I almost always use stop-out points. We exited our gold positions and the gold/silver ratio trade with good profits, and

Bull in Bear’s Skin ?

Posted: 07 May 2011 04:00 PM PDT

Gold University

David Freedom – The Bigger Picture

Posted: 07 May 2011 03:41 PM PDT

In my April letter, I warned readers of the upcoming volatility and suggested that if they wanted a trade, to execute the plan then and resist selling into weakness later.  At the time I sent the letter (4/21), Silver was at $46.26 and subsequently moved to $48.70 on 4/28.

Hopefully you already have gold/silver holdings for protection and you're just accumulating.  If so, you can be more patient.  One school of thought is a cost-averaging approach.  Another is to pick your entries.  My long-term outlook has not changed and pull-backs (including this one) should be used to accumulate.

Please don't mistake my citing of the April letter as an attempt to proclaim that I will always be correct or that I am looking for credit on a good/lucky call.  To the contrary, I fully understand short-term market movements are difficult to call and I am quite often uncomfortable with receiving recognition.  If I have a positive affect, even a small one, I will have fulfilled my purpose.  My rewards, my desired results, are to educate, inform and equip our readers with knowledge and truth.  "To scatter plenty o'er a smiling land, and read their history in our Nation's eyes." (Thomas Gray).

The Bigger Picture -
Definitions of hyperinflation vary.  If we use a 100% cumulative rate over three years as our rule, hyperinflation is now a possibility, not a certainty. I hope I've learned enough to never guarantee anything, however, I don't see any way to salvage the USD without sacrificing the financial industry.  More on this later.  The difference between this depression and the 1930's is that the dollar is no longer pegged to gold.

Currency Devaluation –
What you have to recognize is that gold is money. It is the benchmark by which the Central Banks ultimately measure and devalue their currency. The US is devaluing against gold to reduce the debt burden. You can go as far back as Rome to see how this is done and the consequences. Don't be mislead, devaluation is NOT a good thing. I expect you understand how inflation has impacted the USD. That is what devaluation is. It is a theft of savings, purchasing power and standard of living.

It is true that global currencies are not independent of each other. Although run independently, the exchange rate reflects the overall state of the Balance of Payments of each country. The bulk of global currencies 'encourage' their exchange rates to retain the global competitiveness of that currency through the adjustment of interest rates and more directly occasionally by the buying and selling of that currency in the foreign exchanges. Unless other nations retaliate by devaluing their currencies by a similar amount, they will find their Balance of Payments skewed as though they revalued their currency by that amount against the US Dollar.

Point of No Return -
What most analysts aren't discussing is that we have already come too far to turn back.  Although unlikely, let's say they decide to try to salvage the dollar at the expense of the banks. This would destroy the western banking system with massive defaults and derivative explosions, which would ultimately destroy the USD.  The Fed could allow the bad debt to default (written off). As defaults rage the USD would skyrocket, due to massive liquidations and to a lesser extent, the safety trade. However, as a result of massive defaults, US banks would immediately be unable to honor deposits and the overleveraged financial system would implode. Of course, the government could "back stop"/guarantee the banks, but then we're back into easing which puts the currency at risk. In addition to the banking collapse, The Fed and US Treasury (as the Fed's back-stop) would default. Since this would be a sovereign default, and the USD is stock of that sovereign entity, the USD would collapse.

Should You Dump the Dollar -
I'm conservative by nature, but I have to tell it like it is. We'll have hyperinflation before a new currency is established. In order to bring in a new currency, the people first have to ask nicely. Still, I advise keeping cash for protection.  Although the outcome of the USD is abundantly clear, current laws enforce the USD which should be held for expenses, emergencies, purchases and so forth.  By exiting the USD completely, you forfeit your ability to protect other holdings or take advantage of future opportunities. We are players in a game in which rules are changed (and enforced), sometimes without warning. COMEX margin increases are a perfect example. Don't give up your financial freedom or your ability to protect yourself – in my opinion it's worth the potential cost of dollar devaluation. This is why holding both dollars (national currency) and PMs is prudent.

Foreign Currencies –
Personally I don't think the average investor needs to be trading foreign currencies. As I've mentioned before, all currencies are tied to the same global economy and are nothing more than a promise by the issuing government. If you're looking to protect purchasing power, PMs fit the bill and are much easier to manage.

Understand the implications -
National Receipts –
US annual income from Social Security, Individual and Corporate Income Taxes and Excise Taxes come to about $2.3T.

Deficit –
As I mentioned, the reinvestment from the Fed's existing balance sheet may be able to cover the $1.6T annual deficit. I am being generous assigning $750B-$1T annual rollovers payments from MBS and maturing Treasuries. That's about 65% of the funding for newly issued debt. These payments may last up to two years, depending on the maturity dates of the reinvestments.

Interest Payments –
National debt stands at $14.3T. Since September of 2007 the debt has gained $4B, daily. Interest payments on US national debt in fiscal 2010 was approximately $400B. The average rates for a 3-month T-bill was 0.14%. A weighted increase of just 1% would result in an additional $140B, while a 5% increase would add $700B. This is why I asked the question, what's the Fed's plan of action should rates revert to the mean?

Maturing Debt –
Rollover of existing debt is going to require around $2.4T.

GAAP-based Deficits (SGS) –
Including the Social Security and Medicare, unfunded liabilities have been in the $4 trillion to $5 trillion range since 2008. Total obligations were $76T as of 12/2010 – 5X annual GDP.

There's simply no way for the US (or foreign) governments to cover these shortfalls. Even is the US were to tax 100% of wages and corporate profits, they could still not cover the bill (SGS). This is why I say it's already too late to change course. I believe by the end of 2011 or very early 2012 the US QE will resume in full force. Depending on what tricks can be pulled out of the hat, we may be able to avoid a full blown crisis for a couple years, or it could break within a year.

I'm not too worried about George Soros' portfolio, but I am concerned about mine. Keep your eye on the bigger picture.

~David Freedom
david@thevictoryreport.org

Paging Blythe, cancel your mothers day festivities, Silver OI at 134,804, Paging Blythe

Posted: 07 May 2011 07:58 AM PDT

You can lie, you can cheat, you can steal, but you cant stop people from wanting their physical metal. I assume everyone by now is aware of this incredible news, that after this week when my beloved metal, silver, got shitfucked from $50-33 in 5 trading days and 5 margin raises from dickslappers at the CME whom of which are owned by God (the JP Morgue), we still managed to increased the OI (open

Volcker warns of danger from U.S. deficits

Posted: 06 May 2011 10:50 PM PDT

Volcker warns of danger from U.S. deficits

Speaking before the World Affairs Council of Oregon, Volcker said that "prolonging trillion dollar deficits can't be a reality" and that the United States is on course to have its public debt exceed the size of its gross domestic product.  "One way or another, we do have to return to a balanced budget," he said in prepared remarks.

I thank reader Al Conle for providing this Reuters story...and the link is here.


 

Gold and silver will explode again, Hathaway tells King World News

Posted: 06 May 2011 10:50 PM PDT

Gold and silver will explode again, Hathaway tells King World News

My last offering today is a GATA release regarding this audio interview.  I'll let Chris Powell do the introductions...and the link to this must listen interview is here.


 
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