Show-me Account Talk

[GUCHI]

mayday/CC/MB
truely my pops was not sauvy with investments. he worked hard and saved what he could, but did not know stocks and money investments sorta speak. he has done very well regardless of his knowledge. i have come to realize that TIME is the most important factor in investing. I try to pass this on to whoever is willing to listen, especially my 2 boys 18 and 21 yrs old. i knew I was getting thru when my oldest son started automatic withdraw towards his mutual fund I opened for him, and later was able to justify buying a house at 18 yrs. old. just goes to show that those knot heads do listen !!! and I'm glad for it.
good luck all and thanks to this MB

 

[CapeChem]

As a Parent, you always wonder if they are listening.....After 3 years of school my oldest son upped and move to NYC, Just cuz......He got himself a job and called and said he has a 401K plan and decided to add extra percentages to his plan to take advantage of matching funds...he is 22......my jaw hit the floor...I just know that my father always told me to save early and I didn't listen......my kid has me beat

 

[Show-me]

I'm in.

 

[tsptalk]

As a Parent, you always wonder if they are listening.....After 3 years of school my oldest son upped and move to NYC, Just cuz......He got himself a job and called and said he has a 401K plan and decided to add extra percentages to his plan to take advantage of matching funds...he is 22......my jaw hit the floor...I just know that my father always told me to save early and I didn't listen......my kid has me beat

Sounds like a good kid. Maybe there is hope for the future. A new generation of savers?

 

[Show-me]

I am in and I just don't know. Earnings coming up and I can not expect much more of a run up past 1080. I would seem to be a ridiculous run up from 666 low, but many of these crashes were followed by big run up and then another crash or correction.

I will hold on for now, always late to the party.

 

[Intrepid_Timer]

Good luck Show. I'm still in also and I'm hoping Alcoa posts good results after the close today since aluminum prices have gone up since June. Cross your fingers..................:blink:

 

[kar_crazy]

Good luck Show. I'm still in also and I'm hoping Alcoa posts good results after the close today since aluminum prices have gone up since June. Cross your fingers..................:blink:

great now i can cash in my beer,(coke) cans :laugh: i have a whole truck load of them waiting for the price to go up . last time i went it was not worth the gas to go up there :suspicious:

 

[Intrepid_Timer]

great now i can cash in my beer,(coke) cans :laugh: i have a whole truck load of them waiting for the price to go up . last time i went it was not worth the gas to go up there :suspicious:

LOL. Well I'm not sure what they are paying for cans now but I follow the aluminum index and it hit a low of 217 on 03\05\09 and as of yesterday it was 562. I wonder if they are paying out twice as much as back then? I know the gold index is over 1040 now..................got any gold?

 

[kar_crazy]

LOL. Well I'm not sure what they are paying for cans now but I follow the aluminum index and it hit a low of 217 on 03\05\09 and as of yesterday it was 562. I wonder if they are paying out twice as much as back then? I know the gold index is over 1040 now..................got any gold?

ok now i wish i had a truck load of gold:blink:

 

[Show-me]

WASHINGTON (AP) -- The Obama administration's effort to help homeowners avoid foreclosure may not achieve its goal of helping 3 million to 4 million borrowers and may simply delay mortgage defaults for many, a government watchdog group says.

The Congressional Oversight Panel, charged with making regular assessments of the $700 billion financial rescue fund enacted last year, said the Treasury Department should consider whether to improve the current $50 billion program or adopt new programs to meet an expected rise in foreclosures fed by increased unemployment.

http://finance.yahoo.com/news/Watch...21.html?x=0&sec=topStories&pos=8&asset=&ccode=

 

[Show-me]

Made a very nice 4% on a four day trade. Kills me to not be able to do any more IFT for the month. Even if I could just focus and make 2% a month for the next twenty years. Sweeeeet!

Made my move out of the G fund because I don't want to be greedy and get caught. Roctober is just that and can go both ways. Without the nimbleness of the unlimited IFT I felt I just need to take one bite at a time, regroup for the next month.

Charts look toppy and I am on the fence as to what could happen. Hit close to the top of the Boll. Bands. Dollar could rally because behind the curtain Ben is doing everything possible to keep it from crashing. Remember as lenders write down loans that money automatically vanishes from the money supply.

Earning season is fixed and you could get a rally on the news or a sell the news.

Point is we have come a long ways from 666 and we are due some real pain. Unemployment does not seem to be a negative factor to the markets yet and cutting labor cost is shoring up the bottom lines of many businesses. At some point those chickens will come home to roost. Most likely around the Holidays when manufacturers cut back just before the Holidays and retailers right after the Holidays.

I got alot on my plate personally. House with no heating or insulation and it is in the 30's this morning. Finished part of the house is a toasty 73. I should have it insulated and new furnace in within two weeks.

Beat this into your kids brains, it is their only hope.

If you eliminate $100 of wasteful spending per month and instead channel that cash to an investment vehicle that yields an annual interest rate of 10%, that translates to more than $75,000 over 20 years, and more than $500,000 over the course of 40 years. Granted, the buying power of figure is chewed up by inflation, but the prudent person still reaps the benefits of not wasting cash on unnecessary things.

Starting principal balance: $0
Monthly investment payments: $100
Interest rate: 10%
Future value: 20 years = $75,936
Future value: 40 years = $632,408

Starting principal balance: $0
Monthly investment payments: $250
Interest rate: 10%
Future value: 20 years = $189,842
Future value: 40 years = $1,581,019

If someone were motivated enough to find $500 a month and put it away in the form of investment payments, the results lead to an exponential increase in comfort during one's retirement. With an annual rate of return of 10% over 40 years, the figure approaches $3 million for your nest egg.

Starting principal balance: $0
Monthly investment payments: $500
Interest rate: 10%
Future value: 20 years = $379,684
Future value: 40 years = $3,162,039

How much more would your nest egg be if you work for a company that matches your 401(k) dollar for dollar up to a certain amount? Given that the federal government's social safety net programs such as Social Security and Medicare are expected to hit fiscal challenges as the baby boomers retire, such anticipated uncertainties encourage individuals to take their retirement circumstances into their own hands. Secondly, the high cost of healthcare in the United States is a primary driver for individuals and couples filing for personal bankruptcy. The power of compound interest can help one to avoid financial straits in the future.

 

[Show-me]

Safe Haven

Interesting the number of bearish market and dollar articles on Safe Haven. Here are some clips.

It's best to rebalance before this 'rally' is declared dead. Though troubling for their irrationality, situations like these can be very profitable for the fundamental-focused investor.

http://www.safehaven.com/article-14731.htm

Are company earnings already priced into the market?
Is all this positive market coverage getting the general public to buy up here at this possible market top?
The answer is, only time will tell. No one knows for sure what the market is going to do but short term moves can be predicted with relatively high accuracy.
Don't get me wrong, I am still bullish on the market but with all this good news becoming public information you have to wonder what is next. I am still long the market but trimming my positions to lock in profits and still stay in the game.

http://www.safehaven.com/article-14732.htm

1) The dollar keeps falling, which eventually pushes up long-term interest rates (because who wants to hold long-term bonds that pay interest in a dying currency?) which in turn derails the corporate profit recovery.
2) Commercial real estate craters, taking bank profits with it.
3) The market simply exhausts itself. According to Elliott Wave International, U.S. stocks have just about wrapped up a wave 2 advance and will soon enter a big, nasty wave 3 decline.
Whatever causes the correction, the question is how best to play it. For this, my friend Jose Vargas has compiled a list of short exchange traded funds which can be bought like stocks and are designed to go up when all or part of the market goes down. It's amazing how many choices there are these days, in terms of both leverage and specificity. But don't let the variety overwhelm you. The day will come when everything on this list outperforms.

http://www.safehaven.com/article-14733.htm

The first edition, which was published in early 2002, was "on the mark" with regard to our current economic environment -- so much so that it's uncanny. Prechter's message has been good for investors who kept their money safe and for speculators who profited from declines. And he still expects a great buying opportunity ahead for those who can keep their money safe until it arrives. Here is a short list of some of the accurate predictions he made in 2002 that have come to fruition:

http://www.safehaven.com/article-14734.htm

2. Debt
Taking on debt is like getting a tattoo: it doesn't go away, and it's pretty painful to get rid of.
In the U.S., our current debt picture looks like this:

• National debt

$11.6 trillion (but '09 GDP is only $8.3 trillion)
• Government spending YTD
$2.4 trillion (but tax revenue is only $1.2 trillion)
• Government bailouts
$11.8 trillion (equals $38,815 per U.S. citizen)
But the granddaddy of them all are the unfunded liabilities (meaning, they are not covered by an asset of equal or greater value).

• Medicare/Medicaid liability

$39.6 trillion
• Social Security liability
$10.6 trillion
• Prescription drug liability
$8.5 trillion
• Total unfunded liabilities
$58.7 trillion
So where is the money to pay for all this going to come from? The government has only three choices to meet these liabilities:

1. Raise taxes
2. Cut spending
3. Allow inflation to rise from money printing, diluting the debt burden

You can debate the likelihood of the first two, but everyone at Casey Research is personally betting #3 will come to pass.

http://www.safehaven.com/article-14737.htm

Conclusion
We are not long term dollar bulls, but we feel that dollar is due for a relief rally as it has mounted a very strong correction in a relatively short period of time. We felt the same way from late 2007 to early 2008 and went on record to state that the dollar would mount a very strong rally that would catch the majority with their trousers down.
Additionally after studying the charts of several currencies we find that most are fast approaching strong zones of resistance, which should lead to a correction before the next leg up. As the dollar has been hammered so viciously it would not be wise to open up new bets against it now. The most prudent move would be to wait for a rally before placing new bets against it, and if you are willing to take a bit of a risk you might even consider opening up long positions in the Dollar and or short positions in the Euro.
Our long term view is that the dollar is in trouble, and it could potentially shed an additional 60% of its value in the years to come.

http://www.safehaven.com/article-14735.htm

 

[Birchtree]

I've read those articles but most of that negative stuff rolls off my bullish rump. But we all need to know both sides of the equation - thanx for posting them.

 

[Show-me]

October 17, 2009
Today's Qs Are Nearly Identical To Pre-Crash Nasdaq 1987
by Dan Basch

Today's QQQQ chart shows a Double Top formation with heavily sloped negative divergences on oscillators, which bares striking similarities to that of the Nasdaq Crash of 1987. The two charts have a nearly identical pattern with the primary difference being the slope of ascent.

http://www.safehaven.com/article-14752.htm

The Week Ahead
It's all about those earnings I spoke about in this report. The market is thirsting for them. It wants to know the truth about the economy, or at least the truth given by the Ceo's. Are things appearing to bottom for good or is there enough doubt to knock this market down. Earnings, as I have mentioned, haven't been great but far from terrible. A few more disappointments than I thought we'd see. If this continues, this will likely add to the probability of some type of pullback that can last for a few weeks overall. If the numbers come in extremely well, then the pullback is likely to be muted. The scorecard thus far says there is likely to be some bad ones but we'll see. Nothing else is relevant. Keep a close eye on the Banks. Earnings or bust this week.

http://www.safehaven.com/article-14750.htm

Bank Insolvency Is Not A Dead Issue
by Daniel Aaronson and Lee Markowitz

The Federal Reserve's current 0% interest rate policy will be more damaging to the US economy than the 1% interest rate policy pursued following the NASDAQ bubble collapse. While home owners were the primary losers from the last Federal Reserve policy blunder, all owners of fixed income assets, especially banks, will suffer from the Federal Reserve's current intervention.

The Federal Reserve created the housing bubble by trying to alleviate the problems resulting from the technology bubble. Now, the Federal Reserve is using the same play book to solve the problems caused by the housing bubble. Once again, the medicine will prove to have been worse than the disease. By encouraging mass buying of treasuries at unsustainably low rates, the Federal Reserve has created another bubble. With low short-term and long-term interest rates, a falling US Dollar, and growing US Government debt, there is significant risk that interest rates will increase in the near future. When interest rates rise, those who have used leverage to buy financial assets will see their cost of borrowing increase as the assets they own decline in value. Such an outcome will be even worse than the deleveraging that occurred in 2008 because today the economy is much weaker and assets are lower yielding (higher priced). It is feasible that even without loan losses the entire banking system would be insolvent if treasury yields rise high enough.

http://www.safehaven.com/article-14746.htm

And the Moon's Made of Cheese
by Adrian Ash

The curve-ball in all this - or so we guess here at BullionVault tonight - is not gold, nor stocks, nor even bonds. It's the underlying guess-work, intuition, assumptions.
That gold only rises when the cost of living soars...or bonds only rise when stocks go down...or that a flood of money, created at zero per cent rates, can't drive all things higher together, even the promise of cash redeemed in the future...lapped up by a pensions and finance industry faced with $11 trillion in Treasury-debt supplied, but a central bank vowing to step in if buying fails and cap any rise in rates.
Because right alongside, hedge funds and prop' desks are buying futures and options with virtually free finance. What's not to love in this über-Reflation Rally redux...?

http://www.safehaven.com/article-14745.htm

 

[Show-me]

October 16, 2009
Ignorance Is Bliss
by Peter Schiff

Last week, the Bureau of Economic Analysis reported that consumer spending as a percentage of U.S. GDP has risen to 71%, a post-World War II record. This level is notably higher than other wealthy industrialized countries, and vastly higher than the levels sustained by China and other emerging economies. At the same time, our industrial output is contracting, our trade deficit is expanding once again (after contracting earlier in the year), and our savings rate is plummeting (after an early year surge).

The data confirms that government stimuli are worsening the structural imbalances underlying our economy. The recent 'rebound' in GDP is not resulting from increased economic output, but merely from the fact that we are borrowing more than ever. That is precisely how we got ourselves into this mess. An economy cannot grow indefinitely by borrowing more than it produces. Not only is such a course untenable, but the added debt ensures a deeper recession when the bills come due.

This soon-to-be-called depression will not end until the pendulum of consumer spending habits swings violently in the other direction. This will be a jarring change, but it is the splash of cold water that we need to return our economy to viability. I believe that consumer spending as a share of GDP will need to temporarily contract to roughly 50% of GDP, before eventually moving toward its historic mean of 65%. Such a move would indicate a restoration of our personal savings, a decline in borrowing and trade deficits, and an increased industrial output. That would be a real recovery.

Consumers and governments must spend less so their savings can be made available to businesses for capital investments. Businesses, in turn, will produce more products and employ more people - increasing domestic prosperity. However, rather than allowing a painful cure to return our economy to health, the government prefers to numb the voting public with a toxic saline-drip of deficit spending and cheap money.

The primary factor that enables our government to peddle economic snake oil is the dollar's unique role as the world's reserve currency, and our creditors' willingness to preserve its status. By buying up dollars and loaning them back to us through Treasury debt, productive countries give American politicians carte blanche to play Santa Claus.

Normally, if politicians run up the government deficit, voters soon suffer the unpleasant consequences of higher inflation and rising interest rates. Yet, if foreign central banks keep supplying the funds, these consequences are indefinitely postponed. As a result, there is no need for American politicians to ever make the tough choices required to solve our problems.

Instead, the burden may fall squarely on the citizens of those governments doing all the lending. The conflict is that within the creditor states, a vocal minority actually benefits from this subsidy (owners of Chinese exporters, for example) while the overwhelming majority fails to make the connection. Thus, foreign politicians have the same incentives as ours to keep playing the game.

The bottom line is that foreign governments can lecture us all they want about the need for prudence but if they keep lending, we'll keep spending. Any parent knows that if you give your child a curfew yet never impose any penalties when it's violated, it will not be respected. My gut feeling is that foreign governments are tiring of our conduct and on the verge of finally imposing some discipline. That means the dollar's days as the world's reserve currency are numbered, and the days of American austerity are about to begin.

http://www.safehaven.com/article-14747.htm

 

[Show-me]

It is looking like a correction is way over due but the market keeps climbing the wall of worry.

I left a lot on the table but I have to be OK with 4% for the month with only one trade per month.

 

[mayday]

I agree totally with the artical you posted.

Out of control government spending must cease.

A budget minded family would be careful not to spend more than they make.

Is it too much to ask of our government to do the same? Dave

 

[Show-me]

 

[Show-me]

Still looking very bearish.

Oct 18Does the Adens' $5,800 Gold Projection Suggests +5,000% Gains in Junior Equities? PF - Lorimer Wilson

Oct 18The US Recession: More Unemployment and a Sinking Dollar PF - Gerard Jackson

What gives? The Obama administration no sooner assures Americans that labour markets had finally stabilised and mass job losses was at an end when the Bureau for Labor Statistics comes out last Wednesday and ruins the party with the bad news that mass layoffs leapt by over 20 per cent in August. An earlier report estimated that manufacturing accounted for 31 per cent of the layoffs. (I have stressed numerous times that manufacturing always bears the blunt of the boom-bust-cycle).
It certainly looks like manufacturing is undergoing a very ugly shakeout. That the jobs situation is grim was further underlined by a report from the United States Department of Labor for the week ending 19 September which revealed that the 4-week moving average for jobs claims at 553,500. How can this be? The share markets have been moving upwards for some months and the ISM index has turned positive.

Oct 18Precious Metals, Oil and Nat Gas Trend Charts PF - Chris Vermeulen

Here is my concern:
The market continued to make a new yearly high last week, company earning are better than expected and more retail investors (average working people) are dumping their money back into the market again because EVERY thing is going up in value and all they need to do is buy something. When it's this easy to make money in the investment/trading world something drastic usually happens not long thereafter.

Precious Metals & Energy Trading Conclusion:
In short, I feel the market is ready for a multi month correction, but with solid 3rd quarter earnings, new money is being dumped into stocks and commodities as investor confidence rises. This is extending the rally making it even more over bought in my opinion.
That being said, I will not be shorting the market or stocks anytime soon. This market can continue higher because average investors are putting their money back into the market. If the market does actually top in the coming weeks, there will be plenty of time to short the market using leveraged ETFs. I am still long the market and applying tight stops to my positions.

Oct 18Forecast PF - Jay DeVincentis

We remain in Buy Mode looking for a move higher into the 24th - but continue to be cautious of a reversal here.
The Efficiency chart above looks at theefficiency of movement of the market to the barometer. It too is suggesting a potential reversal here.

Oct 18Muddle Through, R.I.P? PF - John Mauldin

As an aside, I am not expecting that we will see the crisis I am thinking of any time soon. We can move along with positive GDP for some time. I am thinking of the longer term, 1-3 years out. We will become complacent. I will get letters telling me I am too pessimistic. Just as I did in late 2006 when I said we would be in a recession by late 2007. But I firmly believe we will see a double-dip recession within another 18 months (at the most). Stock markets drop on average about 40% in a recession. Adjust your portfolios accordingly.

Oct 18Financial Holocaust, Zero Bound and the Next Leg Down PF - Ty Andros

Everything is mispriced because NO ONE knows what the G7 currencies are worth in purchasing power except as measured in GOLD. Volatility is expanding, and volatility is opportunity for the prepared investor. Buy and hold is DEAD. Absolute return investments with the potential to thrive in up and down markets are the order of the day, as all markets (stocks, bombs, er ... bonds, currencies, commodities, energy, natural resources, etc.) price in the new realities of UNLIMITED money printing to substitute for expanding income and economies in the developed world of the G7. Restoring the functions of money combined with diversification into Absolute Return sInvestments are the order of the day and the most important things to do.

Borrow from The Federal Reserve at ZERO and lend to the treasury or federally-guaranteed mortgage borrowers for a profit, What a great RACKET, with the bills sent to the public if it BLOWS UP!!! IT IS A GUARANTEED CARRY TRADE courtesy of Helicopter Ben and the US Treasury. Who's the patsy? You and I....

Oct 18Silver Update PF - Silver Analyst

Silver is pushing $18, gold has made new all time nominal highs and it all appears to be looking good for The Great Leap Forward. Buyers are piling in fearful of having to buy at higher prices and gold and silver look moon bound. Meanwhile I am now all cash in my trading account and have sold silver bullion as well (for my trading account of course). Yet I believe silver will make new highs and approach the highs not seen since January 1980. Am I insane? No, just bearish medium term and bullish long term. The graph below explains my shorter term fears.

Oct 18Investor Sentiment: I Am Still Singing That Song PF - Guy Lerner

Last week I was changing my tune. This week's tune is the same old song: "Equities are for renting not owning at this juncture. I am not calling for a market top, but prices should trade more in a range, and if you intend to play on the long side, it will be important to maintain your discipline (for risk reasons) and buy at the lows of that trading range and sell at the highs to extract any profits from this market. The upward bias still remains as long as investor sentiment is still extremely bullish, but there is probably greater risk of a market down draft now than in past weeks."

Oct 18The Gold basis is Dead - Long Live the Gold Basis! PF - Antal E. Fekete

Oct 18Words from the (Investment) Wise for the Week That Was (October 12 - 18, 2009) PF - Prieur du Plessis

Meanwhile, according to the Financial Times, a survey of 44 leading economists by the National Association of Business Economics (NABE) showed the jobs that were lost during the Great Recession are not expected to return before 2012, while anemic wage growth of only 1% this year and 2.2% next year is forecast - the slowest two-year period on record. "But the way that investors are almost relying on unemployment to stay high [and central banks not to start exiting from the exceptionally low interest rates any time soon] demonstrates that the recovery, in markets and the economy, remains on shaky foundations," warned FT's investment editor, John Authers.

Oct 17Technical Market Report PF - Mike Burk

Conclusion
Last week, when the indices hit new highs many of the indicators did not confirm those highs and there has been a cyclicality over the past few months that suggests last weeks high was a short term top.
I expect the major indices to be lower on Friday October 23 than they were on Friday October 16.

 

[Show-me]

To those of you in the audience who are business people, pretty simple: If you're paying $12, $13, $14 an hour for factory workers and you can move your factory South of the border, pay a dollar an hour for labor, hire young -- let's assume you've been in business for a long time and you've got a mature work force -- pay a dollar an hour for your labor, have no health care -- that's the most expensive single element in making a car -- have no environmental controls, no pollution controls and no retirement, and you don't care about anything but making money, there will be a giant sucking sound going south.

So we -- if the people send me to Washington the first thing I'll do is study that 2,000-page agreement and make sure it's a two-way street. One last part here -- I decided i was dumb and didn't understand it so I called the Who's Who of the folks who've been around it and I said, "Why won't everybody go South?" They say, "It'd be disruptive." I said, "For how long?" I finally got them up from 12 to 15 years. And I said, "well, how does it stop being disruptive?" And that is when their jobs come up from a dollar an hour to six dollars an hour, and ours go down to six dollars an hour, and then it's leveled again. But in the meantime, you've wrecked the country with these kinds of deals. We've got to cut it out. Ross Perot 1992 2nd Pres. Debate

Just for reference to me.