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- 10 Stocks Goldman Sachs Is Buying
- The Quality Conundrum Has Created Tremendous Opportunity
- Riding The Gold Wave: Data Points To A Coming Gold Bubble
- Freeport McMoRan Is On Sale Again
- The Next Week Will Define The Eurozone's Future
- 5 Food Stocks That Can Survive An Economic Meltdown
- Yahoo article on Penny Hoarding
- What's Weighing on the Markets?
- David Apgar: Could Germany Be Right about the Euro?
- Stranger than Fiction: The Bre-X Gold Scandal
- Silver Charade, Gold Charade
- This past week in gold
- Jim Sinclair: “System Is Broken” & “1764″
- Comex Silver Open Interest Lowest Since May 2009
- James Turk: The Transatlantic Panic
| 10 Stocks Goldman Sachs Is Buying Posted: 04 Dec 2011 05:59 AM PST By Rash Menaria: The following is a list of top stock where Goldman Sachs is increasing its positions according its latest 13F filing with SEC.
Source: 13F filing I believe EQT Corporation is a good buy at current levels and there is a good likelihood of it outperforming going forward. EQT Corporation is an integrated energy company conducting its business through three business segments: EQT Production, EQT Midstream and Distribution. Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The Quality Conundrum Has Created Tremendous Opportunity Posted: 04 Dec 2011 03:04 AM PST href='http://www.valuerestorationproject.com/'>James Abodeely: The market has a way of frustrating even the most patient investors. Value investors who correctly identified the expensive valuations of large cap equities in the late 1990s spent several years watching those overvalued markets become even more so. Investors who correctly identified the nominal lows in stock prices in 1974 had to wait another seven years for their investments to begin compounding at meaningful real rates of return. Investors who watched gold appreciate over 1,100% in less than ten years by November 1979 –to what must have surely seemed like a speculative price of over $400/oz– must have been shocked to see it double once more to over $850/oz over the course of the next few months. As the eminently quotable John Maynard Keynes noted, the market can stay irrational longer than most investors can stay solvent. This, no doubt, is a lesson learned and relearned throughout history. Fortunately, Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Riding The Gold Wave: Data Points To A Coming Gold Bubble Posted: 04 Dec 2011 02:49 AM PST By Jack Holland: Owners of GLD and other gold funds may wish to exercise caution as the price of gold heads into uncharted territory over the next year. The increase in gold prices by investors, central banks, and pension funds has created a growing gold bubble. Starting in 2010 with the IMF's gold selling program created in order to finance sovereign lending programs, the price of gold has remained artificially high due to careful planning of these sales in order not to create panic selling in the market. When selling its gold, the IMF looks to member states that are interested in buying gold for their own reserves, which in effect simply shuffles the gold back and forth between sovereign nations. Thus the sovereign nation buying the IMF gold is able to meet part of its IMF allocation quota. So what is the IMF up to? And what does all this mean for Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Freeport McMoRan Is On Sale Again Posted: 04 Dec 2011 02:38 AM PST By Kevin McElroy: One of my favorite blue chip commodity stocks is on sale again. Freeport McMoRan (NYSE: FCX) currently has more superlatives than a high school yearbook. It's the biggest copper miner in the world. It owns the mining rights to three of the world's largest copper mines - one in Utah, one in Indonesia and one in South America. According to the 2011 Forbes 2000 list, Freeport is the also the highest ranked gold mining company. Forbes ranks companies based on sales, profits, assets and market value - so Freeport beat out market favorites like Gold Corp (NYSE: GG), Barrick Gold (NYSE: ABX) and Newmont Gold (NYSE: NEM). Even better: Freeport currently sells for less than 7 times earnings, and they pay a 2.5% annual yield. Even for a big boring mining company, 7 times earnings is cheap. The entire sector is cheap now too - with the average PE ratio Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The Next Week Will Define The Eurozone's Future Posted: 04 Dec 2011 02:17 AM PST By Tim Clayton: It will be tempting to dismiss media hype and apocalyptic clichés over the next week, but the next 7 days really will define the eurozone future and inevitably also have a pivotal market impact. What has become abundantly clear is that time is running out rapidly as the European and, increasingly, international economies get sucked into a negative feedback loop. The week will be characterized by rumours, political briefing and speculation as tensions build and meetings held. Market volatility will be high and the euro is likely to hit heavy selling pressure on significant rallies. Although speculation has been denied, at least one major European bank was on the point of collapse before the central bank liquidity operation last week and the underlying situation remains perilous at best. Emergency borrowing from the ECB increased sharply on Friday, hardly a vote a confidence, and the global damage is also becoming severe. Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 5 Food Stocks That Can Survive An Economic Meltdown Posted: 04 Dec 2011 01:50 AM PST By Vatalyst: Stocks of major food companies are often regarded as defensive market plays, and with good reason. No matter what, people will eat, and though private brands have picked up market share at the grocery stores, generations of Americans have grown up on Kraft, Jif and Smucker's brands. But this staid industry is undergoing change, as several companies such as Kraft Foods (KFT), Sara Lee Corp (SLE), and Ralcorp Holdings (RAH) have announced restructurings. That being said, all of the companies I will write about here are suitable for value and income investors in the face of an econonic meltdown. They will tend to trail the market in bull markets, and outpace the market in bear markets. Since I don't claim to know much about stock market timing, we will just go one company at a time. H.J Heinz (HNZ) HNZ wisely realized that its domestic condiment, side dish, and pasta Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Yahoo article on Penny Hoarding Posted: 03 Dec 2011 09:22 PM PST Yahoo has an interesting ABC news article on penny hoarding. MSM passes off those of us that stack gold/silver as kooks but those that hoard pennies as savvy investors waiting for their payday. I have nothing against the copper stackers; I just find the media slant to be interesting. http://news.yahoo.com/laws-change-pe...211547264.html | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| What's Weighing on the Markets? Posted: 03 Dec 2011 08:10 PM PST Why Markets Go Down Irrespective Of Economists, Politicians And Central Bankers' Manipulations. Global debts including the USA, Europe, and Asia have grown too large to manage and/or pay-off. The only choice remaining is to print, delay and repudiate most bonds in massive defaults. In the USA, trillions in older, toxic derivative paper has not been dealt with in the aftermath of TARP I. Global banks that were buried under this mess are running two sets of books and banking authorities know it. Those banks were not stopped after the first credit implosion and have gone back for more of the same, making new problems even worse. The stealing continues at levels twice what they were in pre- 2007. The elitists, primary large central bank operators, fomented these failures deliberately to crush their enemies and the USA society at large to install a one-world government and one world currency. It won't work for two reasons: (1) the internet is too free and open for the exchange of information (2) the soon-to-be-wrecked bond markets will destroy any remaining credit and value held by the perpetrator banks. (3) if force is used against consumers, and maybe even if its not, milions of armed Americans with about 500MM guns are ready to revolt. We suspect the violent road, if indeed it ever happens, would be brief as the world and America turn to new paradigms in economics. It's like a big war; but what happens if no one shows up to fight? In economics, what if the formerly participating Sheeple refuse to participate rejecting and dropping out of the system as we know it. The herd can be forced to in some respects but that force will only create violent backlash and further ruin elitists' plans. The Super Committee was a child-like fantasy idealized by dumb politicians to fool the herd. We knew nothing would come of it and we know the mandatory cuts they've talked of never happen either. Do not expect any good decisions or relief from any politician. They are determined to ruin America and plunder what they can personally, and corporately for backers-bankers before they're voted out of office. That goes for both parties. Inflation in 2012 will rise ever faster. Taxes will go up on the expiration of the Bush tax cuts. Over-taxed citizens will go to private trading and off-the-books black markets. Tax collections fall dramatically since incomes do, too. The USA Defense Department will be forced to undergo severe cuts and current Middle Eastern wars will cease, or slow temporarily until a newer, much larger World War III, begins in the aftermath of crashing economies. We expect the current administration to be re-elected with later-on efforts to impeach the president that will fail. People will stop voting in droves. For the most part, voters have lost all faith in their so-called leaders. The US Post Office is under severe pressure but will continue delivering mail, eliminating Saturday delivery and office services. Many rural post offices close for good and rural people must turn to private delivery and other arrangements. Delivery timing will slow considerably, on smaller budgets and fewer employees. Mail service and delivery goes on, albeit slower and more restricted to higher population areas. Private delivery will increase. Watch for public parks and facilities going into disrepair on falling budgets. Some parks may be closed for good and some might even be sold to private owners and developers. Interstate highways are sold to private toll-taking companies to monetize state-held assets for payments on ruined budgets. The "Back To The Land" ideas are in full force. There are still enough oldsters around who remember the Dirty 30's and extreme hardships many felt with a decade of no income. They will teach their kids and friends how to cope. Most anything consumers, individuals and families enjoy such as optional little pleasures like cable TV, internet, cell phones, package delivery and cleaning services will all diminish. One major dish TV provider just reported major service cancellations; I would guess mostly in rural locations where there's no directly connected cable, or internet. Those in a lower income spectrum are just canceling services and making due by using their friends' equipment, or by using cheap cell phones or snail mail. USA Unemployment is now 23% and could be 25% within 90 days. Over the next 18-24 months, it should rise above 30%. The USDA now has nearly 50mm Americans on food stamps costing $75 Billion per year. It gets worse, but we cannot forecast how much worse as this is new and never travelled territory. We hope the USDA can cover and hang-on; especially for innocent children who need the help. One $375mm brand new jet fighter cancellation could feed a whole bunch of little defenseless kids. The American military is very tired-out from a decade of useless wars. Watch for many USA foreign facilities and outposts being canceled and closed on hard budget decisions. We expect a brief 1-3 year pullback with troops returning home. However, when WWIII is started-instigated, probably again in the Middle East, new and costly war-budget demands appear draining more blood and treasure from America. Many are wondering what happens regarding consumers and citizens as Greater Depression II begins to bite harder and deeper. Americans mostly, do not have the social control and manners found in some other nations, yet they are reasonably tolerant. However, as you can see with the phony, instigated OWS demonstrations, things can go awry very easily and quickly. Local police in some cities have finally had enough and cleared them out. It is our contention this goes a lot worse in the heat of next summer with no jobs, money, future, or resources for millions of citizens, not only in America but over the world. There are thousands of US college educated kids who've returned home to live in mom and dad's basement as they have degrees but no jobs. Many are returning to school to get master's degrees; again probably not too useful in the next 5-10 years for most of them. The military is cutting back on budgets and American bases as corporations send more jobs and investments overseas for cheap labor. Corporations will undergo severe public relations pressures for doing this, while having suffered increased taxes and experiencing a larger loss of USA customers who cannot buy nor pay. Thousands of students have discovered they can earn a four year college degree on-line for about $7,500. Further, they can do this while living with parents and hold part-time minimum wage jobs to help with bills. Many will get by with no car and they'll avoid $50,000 in student loan-paybacks down the road. I am seeing more qualified kids (good grades) elect not to attend college but rather work for minimum wage and begin a small business for themselves on the internet, or through other local means. The national job market is toast. Families are having fewer children in this depression as they cannot afford them. It is estimated to cost $250,000 per kid to raise that child from birth to age 18. This economic reality is delaying marriages indefinitely, and delaying married couples from having kids now, or maybe forever. You have to wonder what this means for an entire lost generation from say 2007 to 2027. USA's Federal Reserve and US Treasury is reluctant to discuss implementation of QE-3. The reality is; this has been in play in a stealth manner since QE-2 expired June 31, 2011. The last few bond auctions have been absymal both in America and in Europe. Economist Mark Zandi, whom we consider to be one of the better ones, thinks the QE-3 program begins in February, 2012. We say if true, it would be a formal announcement of an already implemented policy. QE-3 has been running smoothly since July 1, 2011, as a stealth program. Germany is being publicly maligned and mistreated as they have not laid-down and rolled-over to hand-out billions in their taxpayer funds to their lazy, nation-neigbors. We think they have a strategy to pretend to go along with welfare payouts using some specious-suspect credit vehicle like the ESFS emergency credit facilty or some other nonsense promulgated by the broken nations of Europe begging for help. In Germany, after this public relations ploy is in place (with no contingent liability by Germany); they'll defeat it to avoid being ruined. In others words they can escape and, or weasel-word out of it. We say they're on the right track to save Germany from a major economic crash, which is where their broken neighbors are headed next. Germany's plan might be to resume trading the old D-Marks currency and implement necessary decisions to make a major shift, leaving the Euro and a failed Euro-land experiment for good. Germany's damage will be massive loan losses they can afford to cover. Next, they will lose several, larger export customers for German goods. Why? Because those customers will then be unable to afford to buy as (1) bad or no credit and, (2) the German D-Mark currrency will trend toward higher values of Switzerland making German stuff too expensive. Our traders and investors are encouraged to take care of personal family needs first. Then own 10% of accounts up to $100,000 in physical gold and silver. Some are going to 33% physical on the first $100,000. We prefer silver as its cheaper to buy and might rise faster. Get out of all debts and obligations to the extent possible. Review family budgets and cut ruthlessly to save. Hold cash in the house and keep investments to shares in the best gold and silver mining stocks. Watch for a new report in Trader Tracks covering key points a good mining stock should offer for both growth and security. Daily trading volatility is going higher with wider trading ranges and faster trading. We will see market days that scare people into making bad decisions. When markets go nuts, sit back and watch…doing nothing. Trading decisions should be made when you have a clear head not under severe pressure. Some of the best junior mining stocks are going to mint new millionaires before this is over.         This posting includes an audio/video/photo media file: Download Now | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| David Apgar: Could Germany Be Right about the Euro? Posted: 03 Dec 2011 05:15 PM PST By David Apgar, co-founder of GoalScreen, a web app still in trials that lets investors test alternative price drivers of specific securities (free though the end of the year at www.goalscreen.com. He has been a manager at the Corporate Executive Board, McKinsey, the Office of the Comptroller of the Currency, and Lehman, and writes at www.goalscreen.com/blog. What if there are good reasons for the preternatural calm of German Chancellor Merkel's inner circle as the English-language media (based, after all, in the investor capitals of London and New York) light their collective hair on fire about the euro's imminent immolation? Surprisingly, you can make a decent argument that the euro zone is at no risk of breakup – unless someone secretly switches its purpose from facilitating European trade to providing investors an implicit guarantee against losses. The working assumption is that German calm reflects a pious belief in the power of crises to sober up borrowing governments and motivate a little austerity. It was on display Tuesday night at the French Embassy when luminaries as diverse as former ambassador Jean-David Levitte, former UNDP head Kemal Derviş, and former Treasury secretary Larry Summers all quickly agreed on it. Suppose, however, the feasibility of Mediterranean austerity – austerity at a scale big enough to impress the bond markets – is not what Merkel's team is counting on. Suppose instead the Germans are really counting on the feasibility of a series of orderly partial defaults. Not that Merkel thinks austerity is a bad thing. She wants EU treaty changes like the 2%-of-GDP borrowing limit that European Central Bank (ECB) President Draghi hinted today might tempt him to buy more government bonds. But how much stock can she possibly put in a treaty change after her predecessor busted the current 3% limit every year he was in office from 2002 to 2005? (Merkel has busted it only twice – so far.) There are limits to how good a thing austerity is and German history of the last, say, 80 years provides several arresting examples of them. The big unasked question is not whether austerity might be tolerable but whether defaults would be as intolerable as the bond media insist. Here's why Merkel's team could have quietly concluded that the costs of a series of partial defaults are unavoidable even without any defaults, that some of those supposed costs may in fact be disguised benefits, and that the alternatives to selective debt relief are probably unsustainable. As far as costs go, massive European bank restructuring comes to mind, especially following a cool €300 billion or so of losses on government bond holdings. It's hard to say anything nice about bank restructuring, but at least we know how to do it. We know, for example, how to split good banks from bad banks. (Hint: rank balance sheet assets by quality and liabilities by seniority and draw a line across the balance sheet after the last asset of reasonably determinate value.) That's handy when you need banks with systems in place ready to restart lending. And we know these transactions work when free from political interference as they were in Sweden in 1992. We also have institutions like the ECB ready to fix broken banks – unlike broken governments. Less widely discussed, massive European bank restructuring may be unavoidable even if Europe somehow enlisted enough ECB printing presses, enough future earnings of all those carefree northern European taxpayers, and enough future benefits of all those docile southerners to plaster a smile on the face of every bond portfolio manager at BNP Paribas and Commerzbank. The scale of the bailout needed to avoid further investor losses as of today – much less tomorrow or next week – would entail cross-border consolidation or de facto nationalization of a significant portion of the euro banking sector. In one way, a bailout followed by cross-border consolidation and a lot of de facto nationalization could be worse than explicit restructuring. The bailout would cut interest rates on euro government debt enough that banks could keep a lot of it on their books at par. But that would delay recognition of true credit impairments. Delayed recognition of losses has not worked so well for Japan over the past two decades. An unflinching restructuring of banks with big losses on their books has the benefit of at least trying a different approach. Argentina's (latest) default, by contrast, was a mess. But that's the point. The markets readily distinguish defaults that are alternatives to large-scale riots from defaults reflecting political cynicism. It's the market's appraisal of the quality of its politics, not its macroeconomics, that accounts for the harsh treatment of Italy's debt even as most financial analysts argued Spain was in worse shape. Won't unemployment be high in countries that restructure? Yes, rather like unemployment in countries that do not. With its own central bank, a country such as Italy could devalue its currency to soften the impact of austerity on jobs but austerity is what we're questioning. It's hard to find costs of partial defaults that aren't also costs of pretending every euro government but Greece can pay par. As serious as these costs are, moreover, none forces a breakup of the euro – not even the circumstances of hapless Greece, with its 50% debt-relief package. Countries can run distinct interest rates, inflation, budget policy, and growth rates within a currency union just as easily as US states can within the dollar zone. And investors can and probably do understand the distinctive risks those countries pose just as clearly as they understand the credit differences among the 50 states. Germany has good reason to protect the euro – but it may also have good reason to think it's not under threat. The alternatives to partial defaults by countries that can't afford to pay rising interest rates, furthermore, may be unsustainable. The most popular alternative has the ECB stepping in to buy bonds every time investors try to cut their exposure. At first blush, it looks clean – no forced austerity, no messy investor losses and bank restructurings, no burden on taxpayers in creditor countries like Germany. The only problem is that it would be inflationary. And that inflation turns out to be quite a problem. With such ECB generosity on offer – and with euro zone inflation looming – why would any bond trader with a pulse stop after dumping her Greek, Portuguese, Irish, Italian, and Spanish exposure? Why not get rid of the French and German paper in the vaults, as well? Get rid of it all. Well, maybe not the Estonian bonds. But the ECB would be buried. If turning the ECB into a purchaser of last (and first) resort is not the fix it seems, how about replacing today's dubious debt guaranteed only by issuing governments with euro bonds jointly guaranteed by, well, Germans? Surely this would have the enormous benefit of pacifying the markets and so at least take the past year's panics out of the picture. Euro bonds are such a good idea, in fact, that it's hard to understand why US state and local governments, with their longer history of crises in a currency union, haven't got around to using it. The image of a Texas legislator explaining an upcoming state tax hike at the barbecue to pay for the latest California bond issue does, however, help clarify the problem. Any promise by California not to borrow too much that would calm down our Texas legislator's constituents around the grill would be enough to pacify California bond investors without a guarantee. Joint euro zone guarantees ultimately accomplish nothing more than the fiscal promises of individual euro zone states can accomplish without them. Ironically, the ECB purchaser-of-last-resort and eurobond alternatives probably would break up the euro zone. The inflationary strains of the former, and the accountability problems of the latter, would never survive the next referendum in a euro zone state. The purpose of the euro is to facilitate trade and commerce – not facilitate government borrowing. This, then, is the impasse euro zone bond investors have reached. To avoid losses, they clamor for alternatives that could disrupt the currency itself – one of the few things that might actually make them worse off in real terms than they are right now. A brave debtor country or two, backed against the wall, could save them from themselves. As Norman Bailey memorably said of the debt crisis of the 1980s, though, the bankers have no brains and the debtors have no balls.
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| Stranger than Fiction: The Bre-X Gold Scandal Posted: 03 Dec 2011 04:30 PM PST CBC | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Posted: 03 Dec 2011 03:26 PM PST 12/03/2011  GLD – on sell signal. SLV – on sell signal. GDX – on sell signal. Summary Disclosure End of update
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| Jim Sinclair: “System Is Broken” & “1764″ Posted: 03 Dec 2011 12:32 PM PST For your Saturday night reading and viewing pleasure… TVR Presents: Jim Sinclair: "System Is Broken" & "1764 " System Is Broken Without faith in the clearing house system where is faith that what your account statement says means anything whatsoever? Unless MF clients are made whole in every way, the system is broken. It is as if the heads blew off the engine of finance. Where can you keep your money and investments if a clearinghouse is allowed for whatever reason to go broke, therein leaving the clients to suffer? 1764 ~TVR | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Comex Silver Open Interest Lowest Since May 2009 Posted: 03 Dec 2011 08:10 AM PST We have received feedback asking if we knew that "the (COMEX) silver open interest is at the lowest it has been in many, many years," or "has fallen below 100,000 contracts for the first time in many years." For the record, as of Tuesday, November 29, the COMEX silver open interest for the big 5,000 ounce contract was 98,959 contracts open following the roll to March and with a large number of non-commercial spread trades* having been taken off (Non-commercial traders reduced spread trades by 6,195 lots in this most recent report according to the CFTC, with 4,818 of those cancelled spreads attributable to traders the CFTC classes as Managed Money). As the chart just below reveals, the COMEX open interest for silver is indeed at a low level, but not the lowest for "many, many years." The last time the COMEX silver open interest was this low or lower was in the May 26, 2009 COT report (98,120 contracts open then). For reference, the lowest silver open interest on the chart below occurred with the December 2, 2008 report, at 82,434 contracts open.
*A spread trade is a simultaneous long and short trade of the same commodity meant to capture or arbitrage convergence or divergence of the difference between two different contract time periods – or to capture the contraction or widening of the basis. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| James Turk: The Transatlantic Panic Posted: 02 Dec 2011 11:35 PM PST  As more debt is offered as the only solution to impossible indebtedness, GoldMoney founder and GATA consultant James Turk reflected this week on what he called "The Transatlantic Panic." With negative interest rates and bailouts stretching ahead as far as the eye can see, Turk writes, gold's bull market has just as far to go. This is another story I borrowed from a GATA release yesterday...along with Chris Powell's introduction. The story is posted over at the goldmoney.com website...and the link is here. |
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