Thursday, January 31, 2008
Strategy Update Pre-Bell Report for February 1, 2008 -- OPEC Won't Increase Oil Supply and Wall Street Bets Rate Cuts Will Benefit Housing Builders
OPEC MEETING TODAY: My sources in Saudi Arabia say OPEC WILL NOT be increasing it's oil production, as urged by U.S. President George Bush at today's meeting. Reason being, no added demand means no reason to increase supply.
Also keep in mind, they are close to maximum capacity, anyway, and you can't just churn out oil like Dairy Queen soft serve.
Although the price of oil dropped last month, after hitting a record high of $100, due to decreased demand, do not think it is because of recession fears: The drop in demand (and therefore price) is due to a seasonal cycle that occurs almost every year at this time.
Oil may drop to $85 per barrel in February (maybe $80), but expect to see the price rise to $111 per barrel as early as March.
Keep in mind, with the recent 1.25% Fed funds rate cut in January -- and Wall Street placing another half point cut at 100% for the next meeting in March, the oil sheiks aren't going to be too happy about their deflating dollars in which they are paid.
So they tend to want to charge MORE per barrel, not less, to make up the difference.
HOME BUILDERS: With 1.25% rate cut last month (and Wall Street certain of another half point cut at the next meeting), home builders benefited most by the massive cuts, last week, as Wall Street bet the lower interest rates will give a big boost to home builders and sent shares back up, off their depressing bottoms.
A 1.25% cut is a big stimulus boost, but will it actually be able to jump start the industry? All of these cuts are like giving crack to a crack addict. You get a big high, real fast...then you crash (once the credit derivatives market starts to tank over the next five months (starting this month.)
Job numbers will also play a factor in the success or failure of this big home building comeback.
METALS: Batcomputer says Platinum and Palladium will be outperforming gold and silver BIG TIME in the upcoming month(s). PAL is a palladium stock the Batcomputer likes. It's only about $5 a share. BUT BE CAREFUL...it's up 14% today (at 3:00 PM), and it goes up and down a lot in cycles. I would wait for it to drop back down some at this point...BUT, who's to say whether that will happen? LONG TERM INVESTORS WHO FEELS METAL WILL BE ONLY GOING UP...check out Palladium and Platinum, before gold, and I wouldn't be as concerned about waiting for a dip. Palladium stock I like is PAL currently trading at only $5.11 a share.)
Please read this post for more on why we feel the the subprime/derivatives/bond insurance market is much worse than has been disclosed, and how the REAL bottom this year (Dow Jones) is going to be at the 10,700 level between now and August, with lots of ups and downs. (Told you it was worse than accounted for.)
strategyupdate.com
Strategy Update January Recap, February Predictions
1/31/08 End of Month Update = WORST JANUARY IN HISTORY:
When you see the Dow trade in a 400 point range on the same day (the day after another Fed rate cut) -- something is going on...and you better be careful, out there. Those who have been following this site and blog, know that since the end of '07, we have been screaming to pull out of the market by January 2, 2008 to avoid a HUGE down month of historic proportions.
And with historic rate cuts, bail out talk, stimulus packages, and today's 200 point rally -- it is still the worst January in history. Long term investors will say, "So what, it always goes back up." And there is always plenty of money to be made in down markets.
However, for those non-professional investors -- people who cannot afford to take that kind of hit (want to avoid stepping in the biggest puddle in history, if possible) -- then I hope we gained some credibility with you for the future. If you are someone who feels safe because you stick to mutual funds -- or buy a "safe" stock and hold it for life because you know things always go up...this year's market isn't for you. READ MORE
1/31/08 Update (2pm):
* The Dow is up 120 points, after being down 190 on the opening bell. You would HOPE the market would be up after another Fed rate cut! But if people feel the market is at a bottom, Batcomputer says the DOW will be trading in the 10,700 range (the real bottom) between now and August, if not sooner. So please keep that in mind as you make your investment plans this year. It's all about the bond and derivatives market and it's coming down fast and hard. (Feel free to bet against the Batcomputer, but read the Daily Blog for previous predictions first, please.)
* GOOGLE EARNINGS ANNOUNCED AFTER THE BELL: I don't care what the earning results are...in this market Wall Street will find something they don't like and the stock will go down in after hours trading. (But this isn't based on the Batcomputer, just my opinion.)
1/31/08 Pre-Bell Alert:
* You gotta admit -- all SU has done is warn about the bond insurance crisis as we turn the calendar to February '08. Sorry I was off by a day. See 1/30 Closing Bell Investor Alert below. DOW will open up DOW-N! (Hope you can handle the G-Force)
* 1/31/08Opening Bell Update (9:33am): Dow drops 180 points in the first three minutes of trading.
* BOND INSURER BAILOUT: We are looking at nothing less than a massive government bail-out of the bond insurers. Hope they can pull it together in time, before the series of down 300 days hit the market. And SU still feels that the government/Fed will not be able to keep propping up the global economy, long term. A bail-out will help in the short term, but it'll get way too ugly, first because you can never expect for them to pull it together in time -- but I hope they do.
* SEE 1/30 CLOSING BELL INVESTOR ALERT BELOW.
* Gold dropped in overnight trading, but rebounded as the dollar becomes weaker and is trending back up -- but is going down in the 9:00 am hour. Overall, though, don't you think gold will be going up in '08? Should see some up $50 dollar days as the Fed collapses the dollar and inflation kicks in. Gold is the third currency, now. It's not about industrial use, or jewelery. It should be traded as a currency like the dollar and euro. We will see things happen to the euro this year, that we have never seen in history. Things are happening!
* I don't care what people say about supply and demand -- when the dollar goes down -- oil sheiks raise the price of oil to make up the difference. (Added inflation.) So in this case, do not look for an increase in production output to try and bring the price down.
* Weekly jobless claims and consumer spending numbers were released in the 8 AM hour. Reuters says, "Consumers spent less in December than at any time in the past 15 months while applications for unemployment benefits soared last week, two more signs the economy is weakening." This should add a little weight to the anvil, this morning.
1/30/08 Post-Bell Update:
* WE TRIED TO WARN YOU!!! DON'T WAIT TOO LONG IF YOU NEED TO ADJUST YOUR PORTFOLIO! Welp, looks like the bond insurance news Strategy Update has been crying about since late last year -- and early this year -- and even more so this month, warning of problems starting as soon as we turn the calendar to February -- has started to affect the market today, as news is starting to leak out. (See DAILY BLOG and read every thread for the past two weeks.) Evidence? The market was up 125 points (plus), but went south at 3:15pm on this bond insurers news (downgrades starting, and word is getting out that it is much worse) for a DOW close of down 37 points. (And a further slide was "saved by the bell!")
* Reuters Story on bond insurers killing Wall Streets' Rally: Wow, did my Batcomputer and Los Angeles street sources call this one!!! I have NO idea how they know these things, when they know these things (see daily blog)...but at least I listen and have this website to post the news.
* 1/30/08 3 PM HOUR UPDATE: Short term gold traders -- now is the time to sell/take profits for the day. This hour only, otherwise you may want to wait for another bump up, cause at $840/record highs, you will see some profit taking.
back to strategyupdate.com
When you see the Dow trade in a 400 point range on the same day (the day after another Fed rate cut) -- something is going on...and you better be careful, out there. Those who have been following this site and blog, know that since the end of '07, we have been screaming to pull out of the market by January 2, 2008 to avoid a HUGE down month of historic proportions.
And with historic rate cuts, bail out talk, stimulus packages, and today's 200 point rally -- it is still the worst January in history. Long term investors will say, "So what, it always goes back up." And there is always plenty of money to be made in down markets.
However, for those non-professional investors -- people who cannot afford to take that kind of hit (want to avoid stepping in the biggest puddle in history, if possible) -- then I hope we gained some credibility with you for the future. If you are someone who feels safe because you stick to mutual funds -- or buy a "safe" stock and hold it for life because you know things always go up...this year's market isn't for you. READ MORE
1/31/08 Update (2pm):
* The Dow is up 120 points, after being down 190 on the opening bell. You would HOPE the market would be up after another Fed rate cut! But if people feel the market is at a bottom, Batcomputer says the DOW will be trading in the 10,700 range (the real bottom) between now and August, if not sooner. So please keep that in mind as you make your investment plans this year. It's all about the bond and derivatives market and it's coming down fast and hard. (Feel free to bet against the Batcomputer, but read the Daily Blog for previous predictions first, please.)
* GOOGLE EARNINGS ANNOUNCED AFTER THE BELL: I don't care what the earning results are...in this market Wall Street will find something they don't like and the stock will go down in after hours trading. (But this isn't based on the Batcomputer, just my opinion.)
1/31/08 Pre-Bell Alert:
* You gotta admit -- all SU has done is warn about the bond insurance crisis as we turn the calendar to February '08. Sorry I was off by a day. See 1/30 Closing Bell Investor Alert below. DOW will open up DOW-N! (Hope you can handle the G-Force)
* 1/31/08Opening Bell Update (9:33am): Dow drops 180 points in the first three minutes of trading.
* BOND INSURER BAILOUT: We are looking at nothing less than a massive government bail-out of the bond insurers. Hope they can pull it together in time, before the series of down 300 days hit the market. And SU still feels that the government/Fed will not be able to keep propping up the global economy, long term. A bail-out will help in the short term, but it'll get way too ugly, first because you can never expect for them to pull it together in time -- but I hope they do.
* SEE 1/30 CLOSING BELL INVESTOR ALERT BELOW.
* Gold dropped in overnight trading, but rebounded as the dollar becomes weaker and is trending back up -- but is going down in the 9:00 am hour. Overall, though, don't you think gold will be going up in '08? Should see some up $50 dollar days as the Fed collapses the dollar and inflation kicks in. Gold is the third currency, now. It's not about industrial use, or jewelery. It should be traded as a currency like the dollar and euro. We will see things happen to the euro this year, that we have never seen in history. Things are happening!
* I don't care what people say about supply and demand -- when the dollar goes down -- oil sheiks raise the price of oil to make up the difference. (Added inflation.) So in this case, do not look for an increase in production output to try and bring the price down.
* Weekly jobless claims and consumer spending numbers were released in the 8 AM hour. Reuters says, "Consumers spent less in December than at any time in the past 15 months while applications for unemployment benefits soared last week, two more signs the economy is weakening." This should add a little weight to the anvil, this morning.
1/30/08 Post-Bell Update:
* WE TRIED TO WARN YOU!!! DON'T WAIT TOO LONG IF YOU NEED TO ADJUST YOUR PORTFOLIO! Welp, looks like the bond insurance news Strategy Update has been crying about since late last year -- and early this year -- and even more so this month, warning of problems starting as soon as we turn the calendar to February -- has started to affect the market today, as news is starting to leak out. (See DAILY BLOG and read every thread for the past two weeks.) Evidence? The market was up 125 points (plus), but went south at 3:15pm on this bond insurers news (downgrades starting, and word is getting out that it is much worse) for a DOW close of down 37 points. (And a further slide was "saved by the bell!")
* Reuters Story on bond insurers killing Wall Streets' Rally: Wow, did my Batcomputer and Los Angeles street sources call this one!!! I have NO idea how they know these things, when they know these things (see daily blog)...but at least I listen and have this website to post the news.
* 1/30/08 3 PM HOUR UPDATE: Short term gold traders -- now is the time to sell/take profits for the day. This hour only, otherwise you may want to wait for another bump up, cause at $840/record highs, you will see some profit taking.
back to strategyupdate.com
Wednesday, January 30, 2008
Almost as Important as The Super Bowl or American Idol -- Bertankie Fed Decision at 2PM EST
UPDATE: FED CUTS HALF A POINT. Let the good times roll!
"The most important Fed rate decision ever" - Erin Burnett on CNBC 2:00 PM 1/30/08
Not that the decision deserves the attention of the Superbowl or American Idol, but the Fed will announce if there will be a Fed Funds rate cut, and if so how much, at 2:00 PM today.
If it's half a point, there is hope for the world. Anything less, and the world will sink into a black hole, economically. But remember, there is also a Britney Spears hearing about her kids coming up today, too.
GO TO STRATEGYUPDATE.COM FOR BREAKING NEWS ALERTS
Tuesday, January 29, 2008
Why Bertankie and The Fed May Actually Cut Half A Point Tommorow Even Though That Nerd Doesn't Want To Make Wall Street That Happy
ALERT 1/29/08 8:15 AM: GDP and other numbers are coming out and they are sending mixed signals to Wall Street. ALL BETS OFF ON A RATE CUT NUMBER. MAKE SURE YOU ARE PREPARED FOR A DISAPPOINTMENT (NO MATTER WHAT NUMBER YOU ARE LOOKING FOR.) UPDATE SOON!
PLUS, fourth quarter GDP number was up only 0.06% (a bigger number would have indicated more inflation on the way. So the Fed can once again, point to this number to say further cuts (or a big one) is not needed. Set you loss limits now, and for the first time ever in Strategy Update history -- HOPE is part of the strategy, depending on what you are hoping for. WALL STREET STILL WANTS HALF A POINT.
1/30/08 10:30 AM UPDATE: When the ADP (employment number) came out in the 8 am hour, it was good enough to spook Wall Street that there might not be a half point cut. Gold, that was at a record high at the time, started to drop on the news. Within the hour, the GDP number came out, and it indicated to Wall Street that Bertankie and the Fed would HAVE to go a half point, now. And gold started climbing back up from it's five dollar an ounce hit, this morning. And agriculture is at the bottom of the pack today (most down). That's an economic indicator, as well.
FURTHER UPDATES AT STRATEGYUPDATE.COM
Fed announces at 2:00 PM EST. The language and reasoning Bertankie uses (his reasoning behind the numbers) will be important, too. Wall Street will be reading a lot into what he says about what factored into the number.
Alright, so tomorrow, Bertankie may have his name changed back to Bernanke, based on tomorrow's rate cut news. Wall Street has the chance of a .5% point rate cut at 87%. So imagine what will happen if it's anything less. (Wall Street is the biggest bunch of spoiled crybabies on the planet. I know, I know...it's hard being so right in the face of such obvious wrong.)
Normally, I would be saying, "No chance of .5%....25% if anything at all." Reasons being,
* Bernanke doesn't want to appear to be bowing down to a bunch of spoiled crybabies.
* Inflation is on the rise, and a rate cut will make it worse.
* The day they came out with an unprecedented emergency rate cut, last week, turned out part of the problem could have been that rouge trader in France.
* Durable goods number were better than expected.
So they can say, "Well gee, we came out with the full .75% rate cut, last week due to what seemed to be a legitimate global economic crisis. However, at that time, we did not know about the $7 billion in losses from the rouge trader in France. And since inflation is a major concern -- consider the early rate cut to be the rate cut we were going to do today, since it turned out to be for other reasons than we were aware of at the time. And further cuts would offset any benefit, by increased inflation, including higher oil prices, because the oil sheiks in Saudi Arabia have to make up the difference in the weaker dollar -- so they simply hike the price per gallon -- even though there is no added production cost.
HOWEVER...like I said, that's what I WOULD have been saying, except for this little ditty:
Those of you who know me from my political blogging elsewhere, know that I have immersed myself in politics this past couple years, and you hear a lot of things. (Deniro Voice: I heard things.) If you check the StrategyUpdate.com website, you will see that these contacts allowed my to blog about the subprime mortgage crisis on May 5, 2007 -- predicting a bubble burst that would trigger a year long recession starting in November of '07.
Well basically, it happened to the day of the prediction if you check the headlines. And in October, sources recommended pulling out of the stock market entirely (mutual funds and all), because the market was going to start sinking first thing January '08. And we all know what happened.
We also learned that this would cause a big problem in the credit derivatives and bond insurance market. This next shoe, ready to drop, is scheduled to drop in February of '08 (like, next week), when all these derivative options come due, and if you think we had some down 200-300 this past month...
Well, that was just the little wave warning you that the Tsunami is coming. And it ain't gonna be a one week -- or one month sell off. We have already seen things that haven't happened in 70 years, or so. Some things have NEVER happened. You see people who have traded for 20-50 years saying they have never seen a week like last week.
So Bush can try to keep things propped up by visiting the oil sheiks and asking for a break, fiscal stimulus packages, bond insurance bail out talk (even though there wasn't any real talk) -- and the Fed can cut half a point: BUT THEY WILL NOT BE ABLE TO KEEP THE MARKET ARTIFICIALLY PROPPED UP WHEN THE SUBPRIME AND DERIVATIVE MARKETS END UP BEING MUCH WORSE THAN ANYONE WAS LEADING ON TO.
When people start walking away from their homes (since they now owe more than they are worth, once those teaser subprime rates jump to market rate), banks will not only be stuck with all these homes -- they won't be able to sell them, either. (And they won't be taking in all this money, while the homes sink in value.)
People will be later and later on their credit card payments -- and many will simply walk away from those payments, too.
And when these derivative futures come due, it will be like what happened when everyone options were due last week, and everyone was caught short, and we saw a huge sell-off including all the good and profitable stocks to cover the losses on the others.
Bond insurers will be out of business, and we are already starting to see the leaks in the dam start to sprout water this past week.
And I think the Fed knows this. So even though no cut, or .25% would be the right thing to do in these inflationary times; and even though Bertankie would do the wrong thing -- just to show he doesn't bow down to Wall Street ("Revenge of the Nerd")...
Strategy Update feels there IS still hope for at least the half point Wall Street is throwing a tantrum over -- due to the fact that the Fed is seeing numbers that we haven't seen, yet. And the numbers are very, very small where they are supposed to be big. And very, very big where they are supposed to be small.
11PM UPDATE: 11PM Update (1/29/08): O.K., the Batcomputer now feels the chances of a predicted and accounted for half point rate cut is more likely to happen, than not. Here's what we added to the equation that a computer was not able to deduce:
The Fed usually does not like to cut when the dollar is already weak, and oil is already so high, at risk of adding to inflation.
However, those are in ordinarily bad times. These are extra-ordinarily bad times. (See: Subprime/Credit/Derviatives)
So in this case, the big white elephant in the room, is the biggest elephant in the room ever (on steroids), so the Fed will have to try and prevent the massive fire they can see currently burning over the hill -- and worry about the next fire that these embers will spark, once those flames get hot enough. So yes, it's a rock and a hard place. And I think they're gonna go with the hard place. (Half a point so the entire planet doesn't have to blame him, and they'll worry about inflation as it rises. But only because they also know what lurks in the shadows.) And he can add, "we are prepared to step in as needed...", except insert the word, "inflation", next round.
This may help, too:
Reuters: WASHINGTON/NEW YORK—Federal Reserve Chairman Ben Bernanke's job rides on protecting the U.S. economy from the worst of the fallout from housing and financial market turmoil, but politics and a few missteps could determine if he wins another term.
And maaaaaaaan, if the Fed don't cut by at least half a point, I hope you are near a fire exit or have a parachute on hand. (Set your loss limits now!)
And on a lighter note, Strategy Update's Zuma Dogg called into C-Span on Sunday to give his prediction on the U.S. Presidential election. I don't necessarily mean anything I was saying, just wanted to rock the boat for some of my friends who drank a little too much Kool Aid.
StrategyUpdate.com's Zuma Dogg calls into C-Span
strategyupdate.com
PLUS, fourth quarter GDP number was up only 0.06% (a bigger number would have indicated more inflation on the way. So the Fed can once again, point to this number to say further cuts (or a big one) is not needed. Set you loss limits now, and for the first time ever in Strategy Update history -- HOPE is part of the strategy, depending on what you are hoping for. WALL STREET STILL WANTS HALF A POINT.
1/30/08 10:30 AM UPDATE: When the ADP (employment number) came out in the 8 am hour, it was good enough to spook Wall Street that there might not be a half point cut. Gold, that was at a record high at the time, started to drop on the news. Within the hour, the GDP number came out, and it indicated to Wall Street that Bertankie and the Fed would HAVE to go a half point, now. And gold started climbing back up from it's five dollar an ounce hit, this morning. And agriculture is at the bottom of the pack today (most down). That's an economic indicator, as well.
FURTHER UPDATES AT STRATEGYUPDATE.COM
Fed announces at 2:00 PM EST. The language and reasoning Bertankie uses (his reasoning behind the numbers) will be important, too. Wall Street will be reading a lot into what he says about what factored into the number.
Alright, so tomorrow, Bertankie may have his name changed back to Bernanke, based on tomorrow's rate cut news. Wall Street has the chance of a .5% point rate cut at 87%. So imagine what will happen if it's anything less. (Wall Street is the biggest bunch of spoiled crybabies on the planet. I know, I know...it's hard being so right in the face of such obvious wrong.)
Normally, I would be saying, "No chance of .5%....25% if anything at all." Reasons being,
* Bernanke doesn't want to appear to be bowing down to a bunch of spoiled crybabies.
* Inflation is on the rise, and a rate cut will make it worse.
* The day they came out with an unprecedented emergency rate cut, last week, turned out part of the problem could have been that rouge trader in France.
* Durable goods number were better than expected.
So they can say, "Well gee, we came out with the full .75% rate cut, last week due to what seemed to be a legitimate global economic crisis. However, at that time, we did not know about the $7 billion in losses from the rouge trader in France. And since inflation is a major concern -- consider the early rate cut to be the rate cut we were going to do today, since it turned out to be for other reasons than we were aware of at the time. And further cuts would offset any benefit, by increased inflation, including higher oil prices, because the oil sheiks in Saudi Arabia have to make up the difference in the weaker dollar -- so they simply hike the price per gallon -- even though there is no added production cost.
HOWEVER...like I said, that's what I WOULD have been saying, except for this little ditty:
Those of you who know me from my political blogging elsewhere, know that I have immersed myself in politics this past couple years, and you hear a lot of things. (Deniro Voice: I heard things.) If you check the StrategyUpdate.com website, you will see that these contacts allowed my to blog about the subprime mortgage crisis on May 5, 2007 -- predicting a bubble burst that would trigger a year long recession starting in November of '07.
Well basically, it happened to the day of the prediction if you check the headlines. And in October, sources recommended pulling out of the stock market entirely (mutual funds and all), because the market was going to start sinking first thing January '08. And we all know what happened.
We also learned that this would cause a big problem in the credit derivatives and bond insurance market. This next shoe, ready to drop, is scheduled to drop in February of '08 (like, next week), when all these derivative options come due, and if you think we had some down 200-300 this past month...
Well, that was just the little wave warning you that the Tsunami is coming. And it ain't gonna be a one week -- or one month sell off. We have already seen things that haven't happened in 70 years, or so. Some things have NEVER happened. You see people who have traded for 20-50 years saying they have never seen a week like last week.
So Bush can try to keep things propped up by visiting the oil sheiks and asking for a break, fiscal stimulus packages, bond insurance bail out talk (even though there wasn't any real talk) -- and the Fed can cut half a point: BUT THEY WILL NOT BE ABLE TO KEEP THE MARKET ARTIFICIALLY PROPPED UP WHEN THE SUBPRIME AND DERIVATIVE MARKETS END UP BEING MUCH WORSE THAN ANYONE WAS LEADING ON TO.
When people start walking away from their homes (since they now owe more than they are worth, once those teaser subprime rates jump to market rate), banks will not only be stuck with all these homes -- they won't be able to sell them, either. (And they won't be taking in all this money, while the homes sink in value.)
People will be later and later on their credit card payments -- and many will simply walk away from those payments, too.
And when these derivative futures come due, it will be like what happened when everyone options were due last week, and everyone was caught short, and we saw a huge sell-off including all the good and profitable stocks to cover the losses on the others.
Bond insurers will be out of business, and we are already starting to see the leaks in the dam start to sprout water this past week.
And I think the Fed knows this. So even though no cut, or .25% would be the right thing to do in these inflationary times; and even though Bertankie would do the wrong thing -- just to show he doesn't bow down to Wall Street ("Revenge of the Nerd")...
Strategy Update feels there IS still hope for at least the half point Wall Street is throwing a tantrum over -- due to the fact that the Fed is seeing numbers that we haven't seen, yet. And the numbers are very, very small where they are supposed to be big. And very, very big where they are supposed to be small.
11PM UPDATE: 11PM Update (1/29/08): O.K., the Batcomputer now feels the chances of a predicted and accounted for half point rate cut is more likely to happen, than not. Here's what we added to the equation that a computer was not able to deduce:
The Fed usually does not like to cut when the dollar is already weak, and oil is already so high, at risk of adding to inflation.
However, those are in ordinarily bad times. These are extra-ordinarily bad times. (See: Subprime/Credit/Derviatives)
So in this case, the big white elephant in the room, is the biggest elephant in the room ever (on steroids), so the Fed will have to try and prevent the massive fire they can see currently burning over the hill -- and worry about the next fire that these embers will spark, once those flames get hot enough. So yes, it's a rock and a hard place. And I think they're gonna go with the hard place. (Half a point so the entire planet doesn't have to blame him, and they'll worry about inflation as it rises. But only because they also know what lurks in the shadows.) And he can add, "we are prepared to step in as needed...", except insert the word, "inflation", next round.
This may help, too:
Reuters: WASHINGTON/NEW YORK—Federal Reserve Chairman Ben Bernanke's job rides on protecting the U.S. economy from the worst of the fallout from housing and financial market turmoil, but politics and a few missteps could determine if he wins another term.
Bernanke's four-year term as chairman expires on Jan. 31, 2010. The next president, who will take office in early 2009, may consider whether to tap someone else to lead the Fed.
Check back on this blog later this evening or tomorrow for some of the stocks I like for '08, whether it's a bull or bear market. And remember, I bought one gold mining stock on Friday, and it was up 26% on Monday. (Yes, twenty six percent gain in one day.) Read the rest of this blog and you can follow the predictions and analysis and hopefully you'll check back for update.And maaaaaaaan, if the Fed don't cut by at least half a point, I hope you are near a fire exit or have a parachute on hand. (Set your loss limits now!)
And on a lighter note, Strategy Update's Zuma Dogg called into C-Span on Sunday to give his prediction on the U.S. Presidential election. I don't necessarily mean anything I was saying, just wanted to rock the boat for some of my friends who drank a little too much Kool Aid.
StrategyUpdate.com's Zuma Dogg calls into C-Span
strategyupdate.com
Strategy Update Pre-Bell Report for Tuesday 1/29/08
1/29/08 Pre-Opening Bell Update: Batcomputer says "UP" at the bell -- but be very careful...lots of numbers coming out today and tomorrow before the Fed announcement regarding a rate cut -- and if you look at the economy -- do you really think all of these numbers are going to be good? And remember, one little number that disappoints Wall Street, and look for a Southern trend. (And many numbers have been good, but still disappoint Wall Street. BE CAREFUL BETWEEN NOW AND THE MEETING!)
PLATINUM and PALLADIUM has skyrocketed more than gold and silver this week, due to a temporary closure of the biggest producer of these metals in Australia. That sent these metals skyrocketing beyond the gold and silver's record rise. SU recommended PAL last week, and it was up big -- so be careful now. If PAL goes down to $4.20 a share, you might want to jump on board. But most people feel safer with gold.
AFRICAN GOLD MINERS have been hit hard, just as gold has taken off, due to electrical power outages that kept mines shut last week and this week. Harmony Gold has suffered the most, down 6% yesterday, when other miners had a good day. Gold Corp (GFI) just announced today that they will be back to 80% power by Wednesday. So if you wanna buy a gold miner today, and want to try a "riskier play", if you buy these African miners while they are still down -- you may see an extra big gain, when they catch back up, once power is restored. (As long as gold continues to rise. SU feels gold will be much higher in future months.)
GOLD PICKS: Late last week, SU bought UXG (US Gold), the gold mining stock, was up 26% yesterday(20% during the day, and another 6% gain in after hours trading.) 3 of the Top 3 most up miners yesterday were 3 of the 4 miners in the SU portfolio. In other words, we picked 4 metal mining stocks, and 3 of them were the 3 most up, during gold best day in a long time! (Lucky guess,es y'all!!!) Mining stocks are yet to catch up to gold's record rise -- so look for a lot of catching UP with metal miners.
SIRIUS: Yesterday's pre-bell pick, Sirius (SIRI) was indeed up, as expected on news that the F.C.C. may be close to announcing the longly anticipated merger apporoval with XM (XMSR). If and when the F.C.C. announces the approval, expect Sirius to double in price. (SU feels the merger WILL be approved.)
DOW will be up on the bell, in expection of a nice Fed rate cut of half a point. And durable goods numbers were good, as announced at 8:30 AM this morning. But more numbers lie ahead that can reverse this optimism. And although Wall Street puts the chance of a half point rate cut at 80% -- do not bet against Bertankie to disappoint Wall Street, because he doesn't want to appear as though he is being pushed around. And with oil prices rising today, good durable goods numbers -- and the possibility that last week's huge tank on Tuesday (that caused an emergency rate cut) may have been caused by the French rouge trader -- perhaps the Fed will say things aren't as bad as we thought -- and won't cut a full half point for fear of causing stagflation.
THE ONLY REASON I WOULD NOT BET AGAINST A DISAPPOINTING FED RATE CUT -- IS BECAUSE THE FED MIGHT NOT WANT TO PISS OFF THE WORLD AGAIN BY SINKING THE GLOBAL ECONOMY. AND (and it's a BIG "and") our sources feel the Fed has some dismal data that they are looking at, that they haven't told us about, yet. (Credit/subprime/bond insurance, for example.)
So let's see if the Fed is gonna go with the flow -- or do what they actually want to do. (No cut out of fear of stagflation.)
AGRO STOCKS: I don't care how much speculators say the Agriculture sector is overpriced. I like these stocks like POT, MOS, MON, AGU, MOO and others. With a population boom, and emerging markets wanting more protein like meat -- fertilizer (MOS) is better than gold! (Feed, Seed are some others, but they go up and down with more volatility, but if you believe in the sector and like a little more risk for a little more gain...
SUMMARY: Although DOW will be up nicely at the bell, be very cautious, because the subprime/credit/bond market is much worse than people realize -- and with a lot of numbers coming out between now and tomorrow -- anything can happen, and I don't even think the Fed has made the final decision yet. (With Wall Street 80% sure of a half point cut, can you imagine what will happen to the market if it is anything less?)
And SU not only picked Sirius to rise out of nowhere (which it did), the gold stock added to the SU portfolio at the end of last week was up 26% on Monday -- and the Top 3 most up miners yesterday (on the day gold has the big record rise) were 3 of the 4 miners in the SU portfolio. (Not bragging here: Just trying to get some people in my life to start going with the flow, and stop trying to convince me how wrong these predictions are. NO ONE wanted to buy gold when it was at $800 -- and they made sure to tell me how wrong the predictions were.)
FORGET THE REST, STICK WITH THE BEST.
StrategyUpdate.com
(disclosure: UXG, PAL, AUY, EGO)
PLATINUM and PALLADIUM has skyrocketed more than gold and silver this week, due to a temporary closure of the biggest producer of these metals in Australia. That sent these metals skyrocketing beyond the gold and silver's record rise. SU recommended PAL last week, and it was up big -- so be careful now. If PAL goes down to $4.20 a share, you might want to jump on board. But most people feel safer with gold.
AFRICAN GOLD MINERS have been hit hard, just as gold has taken off, due to electrical power outages that kept mines shut last week and this week. Harmony Gold has suffered the most, down 6% yesterday, when other miners had a good day. Gold Corp (GFI) just announced today that they will be back to 80% power by Wednesday. So if you wanna buy a gold miner today, and want to try a "riskier play", if you buy these African miners while they are still down -- you may see an extra big gain, when they catch back up, once power is restored. (As long as gold continues to rise. SU feels gold will be much higher in future months.)
GOLD PICKS: Late last week, SU bought UXG (US Gold), the gold mining stock, was up 26% yesterday(20% during the day, and another 6% gain in after hours trading.) 3 of the Top 3 most up miners yesterday were 3 of the 4 miners in the SU portfolio. In other words, we picked 4 metal mining stocks, and 3 of them were the 3 most up, during gold best day in a long time! (Lucky guess,es y'all!!!) Mining stocks are yet to catch up to gold's record rise -- so look for a lot of catching UP with metal miners.
SIRIUS: Yesterday's pre-bell pick, Sirius (SIRI) was indeed up, as expected on news that the F.C.C. may be close to announcing the longly anticipated merger apporoval with XM (XMSR). If and when the F.C.C. announces the approval, expect Sirius to double in price. (SU feels the merger WILL be approved.)
DOW will be up on the bell, in expection of a nice Fed rate cut of half a point. And durable goods numbers were good, as announced at 8:30 AM this morning. But more numbers lie ahead that can reverse this optimism. And although Wall Street puts the chance of a half point rate cut at 80% -- do not bet against Bertankie to disappoint Wall Street, because he doesn't want to appear as though he is being pushed around. And with oil prices rising today, good durable goods numbers -- and the possibility that last week's huge tank on Tuesday (that caused an emergency rate cut) may have been caused by the French rouge trader -- perhaps the Fed will say things aren't as bad as we thought -- and won't cut a full half point for fear of causing stagflation.
THE ONLY REASON I WOULD NOT BET AGAINST A DISAPPOINTING FED RATE CUT -- IS BECAUSE THE FED MIGHT NOT WANT TO PISS OFF THE WORLD AGAIN BY SINKING THE GLOBAL ECONOMY. AND (and it's a BIG "and") our sources feel the Fed has some dismal data that they are looking at, that they haven't told us about, yet. (Credit/subprime/bond insurance, for example.)
So let's see if the Fed is gonna go with the flow -- or do what they actually want to do. (No cut out of fear of stagflation.)
AGRO STOCKS: I don't care how much speculators say the Agriculture sector is overpriced. I like these stocks like POT, MOS, MON, AGU, MOO and others. With a population boom, and emerging markets wanting more protein like meat -- fertilizer (MOS) is better than gold! (Feed, Seed are some others, but they go up and down with more volatility, but if you believe in the sector and like a little more risk for a little more gain...
SUMMARY: Although DOW will be up nicely at the bell, be very cautious, because the subprime/credit/bond market is much worse than people realize -- and with a lot of numbers coming out between now and tomorrow -- anything can happen, and I don't even think the Fed has made the final decision yet. (With Wall Street 80% sure of a half point cut, can you imagine what will happen to the market if it is anything less?)
And SU not only picked Sirius to rise out of nowhere (which it did), the gold stock added to the SU portfolio at the end of last week was up 26% on Monday -- and the Top 3 most up miners yesterday (on the day gold has the big record rise) were 3 of the 4 miners in the SU portfolio. (Not bragging here: Just trying to get some people in my life to start going with the flow, and stop trying to convince me how wrong these predictions are. NO ONE wanted to buy gold when it was at $800 -- and they made sure to tell me how wrong the predictions were.)
FORGET THE REST, STICK WITH THE BEST.
StrategyUpdate.com
(disclosure: UXG, PAL, AUY, EGO)
Monday, January 28, 2008
StrategyUpdate.com Wall Street Report For Monday 1/28/08: Gold is Up, DOW is Down
1/28 4 PM Closing Bell Update: UGX (gold miner) closed up 20% today! Anyone know why? Gold at new record highs, but most solid miners were up in the 2%-4% range. So what's up with UGX up 20%? Anyway, looks like Wall Street is betting on an agressive Fed rate cut on Wednesday, as we see gold continue to rise and maintain record levels (rather than the ususal profit taking) -- and the DOW closed up 176 points at the closing bell, after dipping down slightly in morning hours. Overall, the mining stocks have a lot of catching up to do, in comparison to gold's meteoric rise. So although gold is at record levels, if you feel it is going to the $1000 level this year, it's not too late for mining stocks. ZD's Palladium pick from last week (PAL) was up 7%, today. Throw in my original gold pick Yamana Gold (AUY) -- and ZD had 3 of the top 3 most "up" gold miners, today. Forget the rest, stick with the best: StrategyUpdate.com
(disclosure: UXG, AUY, EGO, PAL)
11:30 AM UPDATE: Things appear calm at the DOW ahead of further expected Fed rate cuts. Looks as though Wall Street is betting that the Fed will not disappoint with a nice cut on Wednesday -- and people may be sneaking in some last minute positions ahead of the hopeful news that should send the stock market up in confidence -- for the short term. (Subprime/Credit crisis is still out there, though!)
GOLD MINING STOCKS are rising this morning which may signal more expectations that an aggressive Fed cut will weaken the dollar further, which makes gold go up. (And it's already at new record highs today.) Stay away from the miners in Africa though, due to electrical outages. But when the power is back on, they should go up...so you may want to take a chance on that.
MINING STOCK UPDATE: The reason Platinum is up so much today is not only because metals are rising anyway, but because the biggest platinum miner in Australia is shut down for the next couple weeks, so that drove the price up BIG TIME today. Also, PAL (palladuim) was up BIG again today, because that metal is mined by this Australian producer, too. So although it already took a major adjustment up -- with metals continuing to rise in advance of the Fed meeting -- platinum and palladium may continue to be the low key play, that outperforms even gold.
RISK PICK: (DON'T DO IT, BUT I HAVE TO MENTION IT!!!) Harmony HMY is way down today (6%-7% this morning), but they just announced some good news about a new project. They are taking a hit due to African power outages, that may hurt production over the next two weeks. if you are a real cowboy, risk-taker, might be fun to throw a bet down on this one in case it skyrockets back up, if you feel it has already made the negative adjustment and will be closing the gap as the power is restored and gold goes up. OR JUST WATCH AND SEE, LIKE ZD! (If you buy it today, you are basically saying this is as far down as the news will drive the stock, but it may be a couple weeks before it goes up -- and could go down further, a little each day, in the meantime. BUT IT SHOULD BE A FUN ONE TO WATCH.
9:30 AM UPDATE (1/28): DOW down a mild 20 points -- but be careful because the market is very touchy and job numbers and new homes numbers are coming out today. If they are down half a home or half a person more than expected, that could send the market down. Plus, Wall Street is still extra touchy over the financial/credit/subprime crisis that they are still trying to figure out. (Don't worry, it's worse...MUCH WORSE. So be cautious of any rallies/no false sense of hope, please.) McD's earnings (softness in same store sales during December), scared Wall Street into feeling there is U.S. spending softness ahead.
SIRIUS: Been waiting for merger approval with XM by F.C.C. Drudge Report says ruling may be coming down soon. If "yes", stock will double on the news. ZD's Batcomputer says people are taking positions now, saying that Wall Street feel the merger will be approved. If you buy it anywhere below $3.00, you should be real happy. But even in the three dollar range (low threes, hopefully), it you will still be happy if/when the merger is announced. Wish I could buy some! (4PM Closing Bell Update 1/28/08: Sirius closed up 6.57% at the closing bell, which qualifies as a "heartbreaker" since I had to sit on the sidelines and watch, cause I was a little short on cash today.)
1/28 Pre-bell: Gold on the rise toward record highs in overnight trading as U.S. dollar weakens in expectation of further rate cuts this week. Looks like the Dow will be down at the bell. SU says you must be prepared for Bertankie to disappoint Wall Street. (1/27 10pm - will update early AM)
Thursday, January 24, 2008
StrategyUpdate.com Pre-Opening Bell Report for JAN 25, 2008
5pm CLOSING BELL UPDATE: Options specialist (and former NFL player) Pete Najarian of CNBC's "Fast Money" says to expect a streak of highly volatile trading days over the next couple weeks, based on options data. This means up and down 200-300 points within the same day. Lots of trading opportunities for you cowboys. I'm not so optimistic about the up part.
And when gold goes down on Monday, after record highs, remember...it's all about waiting for Bertankie to cut the Fed funds rate at the next meeting. If not...finger on the trigger, y'all.
2pm UPDATE: Dow down 170 points after opening bell rally over concerns over the financial/bond insurance market. Holders beware. Read below on this thread and previous threads for more on this pending market doom of historic proportions. If you feel the market is headed further and further south due to subprime/housing and financial institution crisis -- there are two easy ways to short these markets: SFK (shorts the financials market) and SRS (shorts the real estate market). They are ETFs (Exchange Traded Funds) that go up as these sectors stocks go down. Look into ETFs online and I describe them below on previous threads.
CHECK YESTERDAY'S THREAD BELOW: I'm heartbroken and in tears that I was cashless and couldn't take advantage of my Batcomputer's picks. Oh my goodness, is that a heartbreaker!
__________________________________________________________________
1/25/08:
OPENING BELL: Batcomputer says, "UP" at the bell. Have fun with the rally, but please be aware this blog is very concerned about the credit derivatives market with some big numbers due starting early February -- and the bond insurers market as it relates to the financial industry. And of course, subprime, that we feel is much worse than yet revealed. I think this will be the bear that kills the bull for the rest of '08.
But like I said, today...enjoy the rally if it sticks. And remember, the Government keeps coming up with new press releases to try and keep the markets stable because it is election season -- so check back on this blog for updates, because a change in conditions means a change in course.
BULLS BEWARE: Lots of earnings reports this week (and you never know what little indicator will cause a pullback -- and when news continues to get out that Bush's "bond insurers bailout" as announced on Tuesday -- that sent the market up 600 points -- isn't actually in the works in any way, shape or form (besides wishful thinking), look for a slow downward trend that will end up having some boil, once again. (This time slowly, so they won't jump out of the pot.)
And we'll see how the market reacts to news that the "stimulus checks" won't even be sent out until June (more below). But I don't wanna rain on the parade...Batcomputer says rally at the bell y'all. Can y'all say, pre-market trading, y'all? (Sucker...wait for the opening bell at 9:30 am.)
OIL PRICES RISE ON STIMULUS NEWS: Man, these suckers must actually think that this smoke and mirrors, warm and fuzzy, do nothing, geel good economic stimulus package the Government announced yesterday will actually stimulate something besides their political agenda:
NEW YORK (AP) - Oil futures jumped more than $2 a barrel Thursday after the Bush administration and Congressional leaders agreed to an economic stimulus plan that will give most Americans tax rebates of $600 to $1,200, or even more if they have kids.
Prices were already higher after the government reported a drop in heating oil supplies -- and as investors anticipated a stimulus plan. But futures took off, posting their largest gains in over three weeks, on word that an agreement had been reached.
"What's boosting us up today is a little economic optimism because people are going to get a little free money," said Phil Flynn, an analyst at Alaron Trading Corp., in Chicago.
The weekly inventory report from the Energy Department's Energy Information Administration showed supplies of distillates, which include heating oil and diesel fuel, fell 1.3 million barrels last week, surpassing the average forecast of analysts surveyed by Dow Jones Newswires, who said distillate supplies would remain unchanged.
[Meaning more of a reduced supply than they expected, because they think they can churn out oil like Dairy Queen soft serve with the twist of a level.]
That decline was countered by domestic gasoline inventories, which jumped by 5 million barrels, more than triple analyst expectations. Crude inventories rose by 2.3 million barrels, slightly more than analysts had expected.
[OK...so that balanced it out, so now we see the net result of the stimulus announcement=oil prices up with renewed consumer spending confidence. (Even though I say it won't stimulate shiznit.) See next line.]
Because the report was mixed, investors' attention returned to the economy.
Oil prices have fallen in recent days, following equity markets which dropped earlier this week on recession worries. But the stock market's recovery on Wednesday, as well as overnight rallies by stock markets in Europe and Asia, helped push energy futures higher even before the Energy Department issued its report.
Energy investors often view stocks as a proxy for economic growth, fearing that a slowdown would curtail demand for oil and petroleum products such as gasoline and heating oil.
The jump in crude supplies came despite a 233,000 barrel a day decline in crude imports.
STIMULUS PACKAGE: Not good enough, and not soon enough. Checks won't even start going out until June. Then how long until it is spent. Then the effects felt. Then the turnaround based on this non-effective drip in the bucket. Don't keep your hopes up. Hope the market does. They won't.
I HOPE YOU ARE "HEAVY METAL": Hope you bought gold, silver (and platinum) yesterday as early as possible based on the StrategyUpdate.com Investor Alert. Cause not only did it jump up to near record highs -- ZD's Batcomputer as of 12;00 mid 1/25/08 says the upward trend will continue today. But every prediction, these days, needs a huge "*" attached to it, because there are constant announcements coming out of Washington in an attempt to keep markets stabilized.
But regarding gold, I don't think we are looking at any surprises today. So, although I would be nervous buying it today, up so much and at record highs (including being up, most likely in overnight trading hours) -- long term this year, I still think it is going to be more expensive as the months roll on. If you have steel cajones...you take the chance that it will take a dip at some point (as people tend to take profits at these levels) -- and buy it a little cheaper. But ZD always gets nervous that it will go up, and keep going up as the dollar gets weaker and oil rises. So I don't mind paying a little more today (if it does drop, if I feel it will end up closing much higher in future months.)
ZD's favorite gold stocks: MANY, but here are the first two I would mention. GLD is a Gold ETF. The safe way to invest in gold. Won't ever go up as much as others, but won't go down as much either. (Personally, I would never buy this one...too safe...but that's why some like it the most.)
Rangold Mining (GOLD) I have noticed always seems to go up the most when gold is up, and down the least when gold goes down. Although I'm sure the company's fundamentals are good, perhaps it gets a bump just based on the name. (Hmm, I wanna gold stock...AH, G-O-L-D. That must be it?!?!)
UPDATE 1/26-TFN -- Rangold (GOLD)NEGATIVELY BY THE ELECTRICAL POWER OUTAGES IN AFRICA. DO NOT BUY UNTIL THE POWER IS RESTORED. (Unless you wanna buy it cheap, if you feel this is the bottom, because it will go back up when power is restored, so you could see a nice gain since gold is up anyway.)
Whether that's the case, or not...compare it to any other mining stock and you can see for yourself. The poor man's version of GOLD is Eldorado Gold (EGO). GOLD is about $50, EGO is about $6 and looks like they follow the same trend line. But you are always gonna be a tad safer with GOLD if you can afford it.
SUPER SPECIAL PICK: Palladium has already gone up so much, including overnight hours (most likely) -- but PAL (for Palladium) only costs $4 a share and ZD likes palladium as an investment more than gold. (Duh!) So here's a chance to play it at poor man's prices. BUT CHECK OUT THE COMPANY FIRST ON YOUR OWN -- even though ZD would be buying that like a muther-fer with the blindfolds on. (And these metals do go down, too...so it's either a short term trade if you think it's going up today, as I do -- or a long term investment, because it should be at even higher record highs in '08.
(12/25 Pre-bell Announcement) VISTA GOLD ANNOUNCEMENT: With gold rising, this is the type of press release that I have noticed can drive a company's stock a little (or a lot) higher than the rest of the sector. And Vista (VGZ) is a mining stock that passed the ZD litmus test a while ago. In other words, it can hit the top of the charts when gold is up anyway. So this may send it a little higher than the rest, today:
BERNAKIE MAY HAVE TIPPED HAT: Bernakie said the Fed did not have any information about the French Rouge trader who lost $7 billion, and has some saying that may have triggered the huge fallout of the stock market on Tuesday. So could this mean that the Fed had the wrong info, and now they may feel the economy isn't as bad as it appeared on Tuesday -- and now may not cut again at the next meeting. So if you own bought gold because you feel further rate cuts may drive it higher...you better have your finger on the "sell" button they day he delivers the news at the next meeting. (VERY IMPORTANT TO CONSIDER THIS. Wouldn't be surprised if they cite this as a reason why they don't cut. ESPECIALLY since oil is rising and further cuts would drive it up even further along with inflation.)
ZD Feels AT&T Earning Comment May Indicate Economic Hard Times Ahead:
Shares of the telecommunications giant tumbled two weeks ago when Chairman and CEO Randall Stephenson told analysts at a conference that the company was seeing weakness in its broadband Internet and traditional wire phone businesses because of disconnections for nonpayment.
"Both products are impacted by some of the things we see in the housing market, slowdowns in home sales and new construction," Rick Lindner, AT&T's chief financial officer, said during a call with analysts.
Still, the company expects double-digit growth in its adjusted earnings per share for the year.
"The economy is always a risk, but when you look across our business, we're relatively defensive in these kinds of downturns," Lindner said.
Shares slid 90 cents, more than 2 percent, to $35.79 in afternoon trading.
EARNING'S WEEK FAVORITE: Corning (GLW) reports earnings on January 28th at 8:30 am. You remember Corning: They made all those casserole dishes to cook with and was an old, outdated company. They are a glass company -- and here's why ZD likes Corning: They make this new bendable fiber that cable companies can use to install cable hook-ups where they previously couldn't reach. (Especially apartments and other hard to reach units.) The stuff is flying off the spool like fishing line at a bait shot across from the Marina. Plus, Corning makes the glass that the HD TVs need for the panel. They are trying to produce them as fast as humanly and techonologically possible. Let's just say this area of their business is profitable, these days. So even though it was up 4% today, when earning come out, I have a feeling it will be trading much higher and will be an addition to the "heartbreakers club." (The stocks I didn't have cash to buy, and had to watch the rocket take off with out me. Aaaaaaaaaahh!)
THE DOLLAR: Is dropping faster today than Los Angeles Mayor Antonio Villaraigosa's re-election chances based on the people's disdain for his shady Prop S phone and internet tax that will hurt the L.A. City economy.
CORN: Price of corn will continue to be inflated, in part, thanks to it's use in ethanol production. People are saying the "ying" ain't worth the "yang" because the use for ethanol will inflate food prices. They use corn for everything including sweeteners. They have a corn ETF called CPO that ZD bought a teeny-weeny amount of a while ago for when the numbers come out. So maybe you wanna watch this one from the sidelines and see how it plays out.
Bankers Downplay Reports of Bond Insurer Rescue: Bankers who met with New York insurance regulators to discuss a reported bailout of troubled bond insurers downplayed the meeting's significance Thursday, with one calling it a "non-event."
New York Insurance Superintendent Eric Dinallo said a bailout would involve "complicated issues."
Bankers told CNBC that there was no consensus formed at the meeting and no movement on creating substantial plans for a rescue. Moreover, reports of the meeting may have made a bad situation for the industry worse, bankers said, as a subsequent jump in bond insurer stock prices scared off private equity firms that may otherwise have injected capital into the companies.
News of the meeting helped boost the overall stock market Wednesday.
But shares of both MBIA MBIA and Ambac Financial Group AMBAC Financial Group Inc ABK were sharply lower Thursday after skyrocketing higher the day before.
Regulators met with a number of investment banks to determine if a bailout can be worked out for companies that insure municipal bonds; the insurers have been badly hurt in the meltdown of subprime mortgages, which could lead to a spike in insurance claims.
New York's top insurance regulator himself appeared to play down reports of a bond insurer rescue plan in a statement Thursday. Insurance Superintendent Eric Dinallo said it will take time to implement a series of measures to prop up the bond insurance industry and that his agency won't comment on widely reported details of the plan.
"Clearly it is important to resolve issues related to the bond insurers as soon as possible," Dinallo said. "However, it must be understood that these are complicated issues involving a number of parties and any effective plan will take some time to finalize."
News reports and analysts have said the plan could include investment banks providing as much as $15 billion to help struggling companies.
Analyst Steve Stelmach wrote in a research note Thursday a bailout could entail investment banks providing $5 billion immediately to help struggling companies. That could satisfy capital shortfalls at Security Capital Assurance, Ambac and other insurers. The investment banks could pour in an additional $10 billion in the future, Stelmach said.
[But they just said it isn't going to be happening so quickly. So if the fear of this crisis sent the market tumbling on Tuesday, so fast and hard that Bush had to come out to make an announcement of this proposed bail-out -- which sent it skyrocketing up 600 points...
what do you think the market is going to do when they hear that it isn't a reality?]
California Supreme Court rules employers can fire workers for using medical marijuana
By PAUL ELIAS Jan. 24, 2008
(Excerpt)
SAN FRANCISCO - Employers can fire workers who use medical marijuana even if it was legally recommended by a doctor, the California Supreme Court ruled Thursday, dealing the state another setback in its standoff with federal law enforcement.
The high court upheld a small Sacramento telecommunications company's firing of a man who flunked a company-ordered drug test. Gary Ross held a medical marijuana card authorizing him to use the drug to treat a back injury sustained while serving in the Air Force.
The company, Ragingwire Inc., argued that it rightfully fired Ross because all marijuana use is illegal under federal law, which does not recognize the medical marijuana laws in California and 11 other states.
The justices upheld that argument in a 5-2 decision.
"No state law could completely legalize marijuana for medical purposes because the drug remains illegal under federal law," Justice Kathryn Werdegar wrote for the majority.
StrategyUpdate.com
(investor's research page/links to all the sites i monitor)
disclosure: cpo; plus these positions taken since this thread was initially poste): pal, ego
And when gold goes down on Monday, after record highs, remember...it's all about waiting for Bertankie to cut the Fed funds rate at the next meeting. If not...finger on the trigger, y'all.
2pm UPDATE: Dow down 170 points after opening bell rally over concerns over the financial/bond insurance market. Holders beware. Read below on this thread and previous threads for more on this pending market doom of historic proportions. If you feel the market is headed further and further south due to subprime/housing and financial institution crisis -- there are two easy ways to short these markets: SFK (shorts the financials market) and SRS (shorts the real estate market). They are ETFs (Exchange Traded Funds) that go up as these sectors stocks go down. Look into ETFs online and I describe them below on previous threads.
CHECK YESTERDAY'S THREAD BELOW: I'm heartbroken and in tears that I was cashless and couldn't take advantage of my Batcomputer's picks. Oh my goodness, is that a heartbreaker!
__________________________________________________________________
1/25/08:
OPENING BELL: Batcomputer says, "UP" at the bell. Have fun with the rally, but please be aware this blog is very concerned about the credit derivatives market with some big numbers due starting early February -- and the bond insurers market as it relates to the financial industry. And of course, subprime, that we feel is much worse than yet revealed. I think this will be the bear that kills the bull for the rest of '08.
But like I said, today...enjoy the rally if it sticks. And remember, the Government keeps coming up with new press releases to try and keep the markets stable because it is election season -- so check back on this blog for updates, because a change in conditions means a change in course.
BULLS BEWARE: Lots of earnings reports this week (and you never know what little indicator will cause a pullback -- and when news continues to get out that Bush's "bond insurers bailout" as announced on Tuesday -- that sent the market up 600 points -- isn't actually in the works in any way, shape or form (besides wishful thinking), look for a slow downward trend that will end up having some boil, once again. (This time slowly, so they won't jump out of the pot.)
And we'll see how the market reacts to news that the "stimulus checks" won't even be sent out until June (more below). But I don't wanna rain on the parade...Batcomputer says rally at the bell y'all. Can y'all say, pre-market trading, y'all? (Sucker...wait for the opening bell at 9:30 am.)
OIL PRICES RISE ON STIMULUS NEWS: Man, these suckers must actually think that this smoke and mirrors, warm and fuzzy, do nothing, geel good economic stimulus package the Government announced yesterday will actually stimulate something besides their political agenda:
NEW YORK (AP) - Oil futures jumped more than $2 a barrel Thursday after the Bush administration and Congressional leaders agreed to an economic stimulus plan that will give most Americans tax rebates of $600 to $1,200, or even more if they have kids.
Prices were already higher after the government reported a drop in heating oil supplies -- and as investors anticipated a stimulus plan. But futures took off, posting their largest gains in over three weeks, on word that an agreement had been reached.
"What's boosting us up today is a little economic optimism because people are going to get a little free money," said Phil Flynn, an analyst at Alaron Trading Corp., in Chicago.
The weekly inventory report from the Energy Department's Energy Information Administration showed supplies of distillates, which include heating oil and diesel fuel, fell 1.3 million barrels last week, surpassing the average forecast of analysts surveyed by Dow Jones Newswires, who said distillate supplies would remain unchanged.
[Meaning more of a reduced supply than they expected, because they think they can churn out oil like Dairy Queen soft serve with the twist of a level.]
That decline was countered by domestic gasoline inventories, which jumped by 5 million barrels, more than triple analyst expectations. Crude inventories rose by 2.3 million barrels, slightly more than analysts had expected.
[OK...so that balanced it out, so now we see the net result of the stimulus announcement=oil prices up with renewed consumer spending confidence. (Even though I say it won't stimulate shiznit.) See next line.]
Because the report was mixed, investors' attention returned to the economy.
Oil prices have fallen in recent days, following equity markets which dropped earlier this week on recession worries. But the stock market's recovery on Wednesday, as well as overnight rallies by stock markets in Europe and Asia, helped push energy futures higher even before the Energy Department issued its report.
Energy investors often view stocks as a proxy for economic growth, fearing that a slowdown would curtail demand for oil and petroleum products such as gasoline and heating oil.
The jump in crude supplies came despite a 233,000 barrel a day decline in crude imports.
STIMULUS PACKAGE: Not good enough, and not soon enough. Checks won't even start going out until June. Then how long until it is spent. Then the effects felt. Then the turnaround based on this non-effective drip in the bucket. Don't keep your hopes up. Hope the market does. They won't.
I HOPE YOU ARE "HEAVY METAL": Hope you bought gold, silver (and platinum) yesterday as early as possible based on the StrategyUpdate.com Investor Alert. Cause not only did it jump up to near record highs -- ZD's Batcomputer as of 12;00 mid 1/25/08 says the upward trend will continue today. But every prediction, these days, needs a huge "*" attached to it, because there are constant announcements coming out of Washington in an attempt to keep markets stabilized.
But regarding gold, I don't think we are looking at any surprises today. So, although I would be nervous buying it today, up so much and at record highs (including being up, most likely in overnight trading hours) -- long term this year, I still think it is going to be more expensive as the months roll on. If you have steel cajones...you take the chance that it will take a dip at some point (as people tend to take profits at these levels) -- and buy it a little cheaper. But ZD always gets nervous that it will go up, and keep going up as the dollar gets weaker and oil rises. So I don't mind paying a little more today (if it does drop, if I feel it will end up closing much higher in future months.)
ZD's favorite gold stocks: MANY, but here are the first two I would mention. GLD is a Gold ETF. The safe way to invest in gold. Won't ever go up as much as others, but won't go down as much either. (Personally, I would never buy this one...too safe...but that's why some like it the most.)
Rangold Mining (GOLD) I have noticed always seems to go up the most when gold is up, and down the least when gold goes down. Although I'm sure the company's fundamentals are good, perhaps it gets a bump just based on the name. (Hmm, I wanna gold stock...AH, G-O-L-D. That must be it?!?!)
UPDATE 1/26-TFN -- Rangold (GOLD)NEGATIVELY BY THE ELECTRICAL POWER OUTAGES IN AFRICA. DO NOT BUY UNTIL THE POWER IS RESTORED. (Unless you wanna buy it cheap, if you feel this is the bottom, because it will go back up when power is restored, so you could see a nice gain since gold is up anyway.)
Whether that's the case, or not...compare it to any other mining stock and you can see for yourself. The poor man's version of GOLD is Eldorado Gold (EGO). GOLD is about $50, EGO is about $6 and looks like they follow the same trend line. But you are always gonna be a tad safer with GOLD if you can afford it.
SUPER SPECIAL PICK: Palladium has already gone up so much, including overnight hours (most likely) -- but PAL (for Palladium) only costs $4 a share and ZD likes palladium as an investment more than gold. (Duh!) So here's a chance to play it at poor man's prices. BUT CHECK OUT THE COMPANY FIRST ON YOUR OWN -- even though ZD would be buying that like a muther-fer with the blindfolds on. (And these metals do go down, too...so it's either a short term trade if you think it's going up today, as I do -- or a long term investment, because it should be at even higher record highs in '08.
(12/25 Pre-bell Announcement) VISTA GOLD ANNOUNCEMENT: With gold rising, this is the type of press release that I have noticed can drive a company's stock a little (or a lot) higher than the rest of the sector. And Vista (VGZ) is a mining stock that passed the ZD litmus test a while ago. In other words, it can hit the top of the charts when gold is up anyway. So this may send it a little higher than the rest, today:
Vista Gold Corp. Announces Completion of Acquisition of Properties Adjacent to the Guadalupe de los Reyes Project in Mexico
DENVER, Jan. 24 /PRNewswire-FirstCall/ -- Vista Gold Corp. (Amex: VGZ;SILVER: Silver-lovers will remind you that the metal is down 67% off it's all time high, while gold and palladium have already risen to highs. So they feel silver is poised to really skyrocket if metals continue to. So far, all ZD has noticed is that it continues to go up and down along with gold...but you will always be looking back saying, "wish I had put it in gold". But here's a cheap and easy way to invest in silver, which should be going up anyway -- with or without the extra explosive boom some are hoping for: ETF's (Exchange Traded Funds). Like a mutual fund in a stock and very sector selective. The best known one for silver is SLV which trades at around $163. But ZD had to stick to the poor man's version of the silver ETF, DBS which is around $30 a share. And if you do a chart comparison, they trade along the same trend line, almost exactly. (So if Mr. Bigshot SLV ETF is going to go up...ZD's little DBS will go up the same percentage wise y'all. So don't think you're better than me, just cause you own SLV and I got the cheap-ass version.
TSX) is pleased to announce that it has completed the acquisition of
interests in various mineral properties adjacent to Vista's Guadalupe de
los Reyes Project in Sinaloa, Mexico, as previously announced on December
19, 2007. This acquisition has the effect of consolidating Vista's land
position in this area.
9:30am OPENING BELL UPDATE 1/28/05: Vista Gold opened up 9% on the bell, surpassing all other
gold mining stocks which were up nicely, too, with gold at a new record high. PAL is up 9%, too. Vista will
level off, I'm sure, but should still be an out-performer for the day against all other gold stocks.
BERNAKIE MAY HAVE TIPPED HAT: Bernakie said the Fed did not have any information about the French Rouge trader who lost $7 billion, and has some saying that may have triggered the huge fallout of the stock market on Tuesday. So could this mean that the Fed had the wrong info, and now they may feel the economy isn't as bad as it appeared on Tuesday -- and now may not cut again at the next meeting. So if you own bought gold because you feel further rate cuts may drive it higher...you better have your finger on the "sell" button they day he delivers the news at the next meeting. (VERY IMPORTANT TO CONSIDER THIS. Wouldn't be surprised if they cite this as a reason why they don't cut. ESPECIALLY since oil is rising and further cuts would drive it up even further along with inflation.)
ZD Feels AT&T Earning Comment May Indicate Economic Hard Times Ahead:
Shares of the telecommunications giant tumbled two weeks ago when Chairman and CEO Randall Stephenson told analysts at a conference that the company was seeing weakness in its broadband Internet and traditional wire phone businesses because of disconnections for nonpayment.
"Both products are impacted by some of the things we see in the housing market, slowdowns in home sales and new construction," Rick Lindner, AT&T's chief financial officer, said during a call with analysts.
Still, the company expects double-digit growth in its adjusted earnings per share for the year.
"The economy is always a risk, but when you look across our business, we're relatively defensive in these kinds of downturns," Lindner said.
Shares slid 90 cents, more than 2 percent, to $35.79 in afternoon trading.
EARNING'S WEEK FAVORITE: Corning (GLW) reports earnings on January 28th at 8:30 am. You remember Corning: They made all those casserole dishes to cook with and was an old, outdated company. They are a glass company -- and here's why ZD likes Corning: They make this new bendable fiber that cable companies can use to install cable hook-ups where they previously couldn't reach. (Especially apartments and other hard to reach units.) The stuff is flying off the spool like fishing line at a bait shot across from the Marina. Plus, Corning makes the glass that the HD TVs need for the panel. They are trying to produce them as fast as humanly and techonologically possible. Let's just say this area of their business is profitable, these days. So even though it was up 4% today, when earning come out, I have a feeling it will be trading much higher and will be an addition to the "heartbreakers club." (The stocks I didn't have cash to buy, and had to watch the rocket take off with out me. Aaaaaaaaaahh!)
THE DOLLAR: Is dropping faster today than Los Angeles Mayor Antonio Villaraigosa's re-election chances based on the people's disdain for his shady Prop S phone and internet tax that will hurt the L.A. City economy.
CORN: Price of corn will continue to be inflated, in part, thanks to it's use in ethanol production. People are saying the "ying" ain't worth the "yang" because the use for ethanol will inflate food prices. They use corn for everything including sweeteners. They have a corn ETF called CPO that ZD bought a teeny-weeny amount of a while ago for when the numbers come out. So maybe you wanna watch this one from the sidelines and see how it plays out.
Bankers Downplay Reports of Bond Insurer Rescue: Bankers who met with New York insurance regulators to discuss a reported bailout of troubled bond insurers downplayed the meeting's significance Thursday, with one calling it a "non-event."
New York Insurance Superintendent Eric Dinallo said a bailout would involve "complicated issues."
Bankers told CNBC that there was no consensus formed at the meeting and no movement on creating substantial plans for a rescue. Moreover, reports of the meeting may have made a bad situation for the industry worse, bankers said, as a subsequent jump in bond insurer stock prices scared off private equity firms that may otherwise have injected capital into the companies.
News of the meeting helped boost the overall stock market Wednesday.
But shares of both MBIA MBIA and Ambac Financial Group AMBAC Financial Group Inc ABK were sharply lower Thursday after skyrocketing higher the day before.
Regulators met with a number of investment banks to determine if a bailout can be worked out for companies that insure municipal bonds; the insurers have been badly hurt in the meltdown of subprime mortgages, which could lead to a spike in insurance claims.
New York's top insurance regulator himself appeared to play down reports of a bond insurer rescue plan in a statement Thursday. Insurance Superintendent Eric Dinallo said it will take time to implement a series of measures to prop up the bond insurance industry and that his agency won't comment on widely reported details of the plan.
"Clearly it is important to resolve issues related to the bond insurers as soon as possible," Dinallo said. "However, it must be understood that these are complicated issues involving a number of parties and any effective plan will take some time to finalize."
News reports and analysts have said the plan could include investment banks providing as much as $15 billion to help struggling companies.
Analyst Steve Stelmach wrote in a research note Thursday a bailout could entail investment banks providing $5 billion immediately to help struggling companies. That could satisfy capital shortfalls at Security Capital Assurance, Ambac and other insurers. The investment banks could pour in an additional $10 billion in the future, Stelmach said.
[But they just said it isn't going to be happening so quickly. So if the fear of this crisis sent the market tumbling on Tuesday, so fast and hard that Bush had to come out to make an announcement of this proposed bail-out -- which sent it skyrocketing up 600 points...
what do you think the market is going to do when they hear that it isn't a reality?]
California Supreme Court rules employers can fire workers for using medical marijuana
By PAUL ELIAS Jan. 24, 2008
(Excerpt)
SAN FRANCISCO - Employers can fire workers who use medical marijuana even if it was legally recommended by a doctor, the California Supreme Court ruled Thursday, dealing the state another setback in its standoff with federal law enforcement.
The high court upheld a small Sacramento telecommunications company's firing of a man who flunked a company-ordered drug test. Gary Ross held a medical marijuana card authorizing him to use the drug to treat a back injury sustained while serving in the Air Force.
The company, Ragingwire Inc., argued that it rightfully fired Ross because all marijuana use is illegal under federal law, which does not recognize the medical marijuana laws in California and 11 other states.
The justices upheld that argument in a 5-2 decision.
"No state law could completely legalize marijuana for medical purposes because the drug remains illegal under federal law," Justice Kathryn Werdegar wrote for the majority.
StrategyUpdate.com
(investor's research page/links to all the sites i monitor)
disclosure: cpo; plus these positions taken since this thread was initially poste): pal, ego
Strategy Update Investor Alert: Batcomputer says Gold and Stock Market Will Have Big Rally Today (1/24/08)
GOLD ALERT: For some reason my Batcomputer just issued an alert that gold will be shooting up today. Says it will not only break $900 today, but will be at $1000 in no time, but will be going to $1000 before you know it. I do not know why this prediction alert was issued overnight, so I will look into it...because I NEVER, EVER, EVER bet against the Batcomputer.
STOCK MARKET ALERT: Again, Batcomputer says BIG rally today. Batcomputer is telling me to buy as much as everything I like -- FOR THE SHORT TERM AS AS TRADES. Because the Batcomputer also say, "Although George Bush stepped in yesterday, as the market dropped another 300 points to announce a possible bond insurers bailout (which sent it back up 600 points to close nearly 300 points up) -- the smoke and mirrors are not going to be able to prevent the inevitable in the credit derivative/bond insurers market. And then the banks will really tank.
HEARTBREAKER PICK OF THE DAY: Agro Fertilizer company Potash (POT) released earnings early this morning. They doubled! By the time you read this, it will be too late. It closed yesterday at $120.15. If the market is up, as expected (if the jobs number report doesn't tank it, and they are always able to "fix" those numbers to stay just good enough), then POT should be up to a heartbreaking high. It will easily open at the $130 range and skyrocket from there.
Potash is just about my favorite stock on the planet in '08, along with Mosaic (MOS), so when the market takes a dip in the near future, maybe you wanna pick some up. Expect MOS to ride Potash's upwave today too, so we can all be heartbroken that we didn't pick any of that up in pre-market trading, either. MOS closed at $81, after a day low of $71. If it doesn't open at $85 or higher, I will eat a bag of their fertilizer!
I'll let you know why I like these companies sometime soon on this blog. If you are in a real hurry, you can send me an email at contact@strategyupdate.com and I'll try and fire of a response.
ENJOY THE RALLY WHILE WE GOT IT: The big shoe will start to drop in February and last until August. So long term investors who always cling to their portfolio, no matter what, because they are comfortable with the cycles they are used to seeing (aka: it always goes back up), will suffer a much worse series of months than the one we just had in January of '08. In other words, this is the little wave that signals the big one is getting ready to crash down on your portfolio. (Sorry optimistic critical of this belief.)
STOCK WATCH: If you like retail (and I don't), Gamestop (GME) is our clear favorite for '08. The average customer age is surprisingly in their 30's. These stupid video games are recession proof, because the mindless idiots who play them are addicted, and new technology/improved graphics is causing everyone to have to upgrade and keep buying all the new games. The store is extremely focused (only sell games). Nintendo just reported Wi sales skyrocketed off the chart, and Gamestop is the best place to find Wi. Rockband and Guitar Hero is hot...again, GME is the place to be for these. And it's been beat down hard with everything else. I know it was $63 for a minute a few months ago. And they keep going with extra conservative guidance.
CELL PHONE PLAY: Nokia said today that their earnings were way up. So if that is the case, there is a stock that is very beaten up, that benefits by this news, SNCR. Their main success is tied to Apple, and especially the iPhone, so you have to consider that, too. And, therefore is also tied to AT&T, so if you think a lot of iPhones and AT&T phones (iPhone is only available at AT&T), and wanna ride the Nokia good news -- check into SNCR if you like a higher risk, speculative stock. But we say it ain't that speculative, y'all. But be careful on that one. Maybe you just wanna watch SNCR to see if we called the right trend on it.
10 AM UPDATE: Oh my goodness...had to bust in with a one-hour update for the day-traders:
SNCR up 20% (must be on the Nokia News)
Nokia up 7%
Potash up 7%
Mosaic up 7%
Gold up $24.00
Yikes...ZD was very un-liquid and wasn't able to take his own advice. Unfortunately...No disclosure, y'all!
10:54 AM AMGEN Update: Amgen reports earnings today. They feel they will have a financially positive '08, in part due to layoffs that allowed them to reduce costs. Wall Street hates Amgen, right now, because of increased competition, Government investigations, and bad news on a bunch of their pipe dream future drugs. Analysts feel it may indeed take a big hit, but be up in '08. ZD says sell that sh*t right now, y'all. (They DID raise guidance, and they are saying the financial picture is A-OK, but you know Wall Street reacts like a bunch of spoiled crybabies, and if it isn't better than expected, it will tank, because they already don't like it for the reasons stated above. So I wouldn't take the chance that it may go up. I think you have to look more to the risk on this call. We will see.
INFLATION RATE IN '08: The Batcomputer just spit out a 7% inflation rate for '08. Hopefully, not enough to scare off the Fed from another rate cut at the next meeting.
ROUGE TRADER: Exposed today in France, the rouge trader cost his bank $7 Billion in losses. I bet if his options weren't due, down at historic proportions -- like everyone else's -- he wouldn't have been discovered. If true, it's the biggest fraud in history.
So here's the problem: Do you think this was the only guy in the entire world doing this? If not, how many more do we expect to see. Let's see Bush try and bail those out!
DOW CHEMICAL CEO ON CNBC: Was not allow to speak on his own company, because it is the slient period before earnings are announced. But ZD feels he just may have accidentally tipped his hat to sell before the announcement. Here's all I am basing it on: At the end of the interview, he said, "After earnings come out, remind me to tell you about our new strategy we will be announcing." Signaling to me, that he knows they will be under-performing expectations, (possibly because the high price of oil that they rely heavily upon/see below) -- and to please hold on because we have some exciting things to keep you hopeful. But he's planning on oil averaging $80 a barrel in '08. It hit $100 at the end of '08 and is at $87 today. (Batcomputer says, "Oil=going up!")
Dow sidebar: Since he couldn't speak on the company, he stuck to speaking about the price of oil in '08, which he says should average at $80 a barrel, but admitted he predicted it at $60 last year -- even though it was riding high in the $90s at year's end.
strategyupdate.com
STOCK MARKET ALERT: Again, Batcomputer says BIG rally today. Batcomputer is telling me to buy as much as everything I like -- FOR THE SHORT TERM AS AS TRADES. Because the Batcomputer also say, "Although George Bush stepped in yesterday, as the market dropped another 300 points to announce a possible bond insurers bailout (which sent it back up 600 points to close nearly 300 points up) -- the smoke and mirrors are not going to be able to prevent the inevitable in the credit derivative/bond insurers market. And then the banks will really tank.
HEARTBREAKER PICK OF THE DAY: Agro Fertilizer company Potash (POT) released earnings early this morning. They doubled! By the time you read this, it will be too late. It closed yesterday at $120.15. If the market is up, as expected (if the jobs number report doesn't tank it, and they are always able to "fix" those numbers to stay just good enough), then POT should be up to a heartbreaking high. It will easily open at the $130 range and skyrocket from there.
Potash is just about my favorite stock on the planet in '08, along with Mosaic (MOS), so when the market takes a dip in the near future, maybe you wanna pick some up. Expect MOS to ride Potash's upwave today too, so we can all be heartbroken that we didn't pick any of that up in pre-market trading, either. MOS closed at $81, after a day low of $71. If it doesn't open at $85 or higher, I will eat a bag of their fertilizer!
I'll let you know why I like these companies sometime soon on this blog. If you are in a real hurry, you can send me an email at contact@strategyupdate.com and I'll try and fire of a response.
ENJOY THE RALLY WHILE WE GOT IT: The big shoe will start to drop in February and last until August. So long term investors who always cling to their portfolio, no matter what, because they are comfortable with the cycles they are used to seeing (aka: it always goes back up), will suffer a much worse series of months than the one we just had in January of '08. In other words, this is the little wave that signals the big one is getting ready to crash down on your portfolio. (Sorry optimistic critical of this belief.)
STOCK WATCH: If you like retail (and I don't), Gamestop (GME) is our clear favorite for '08. The average customer age is surprisingly in their 30's. These stupid video games are recession proof, because the mindless idiots who play them are addicted, and new technology/improved graphics is causing everyone to have to upgrade and keep buying all the new games. The store is extremely focused (only sell games). Nintendo just reported Wi sales skyrocketed off the chart, and Gamestop is the best place to find Wi. Rockband and Guitar Hero is hot...again, GME is the place to be for these. And it's been beat down hard with everything else. I know it was $63 for a minute a few months ago. And they keep going with extra conservative guidance.
CELL PHONE PLAY: Nokia said today that their earnings were way up. So if that is the case, there is a stock that is very beaten up, that benefits by this news, SNCR. Their main success is tied to Apple, and especially the iPhone, so you have to consider that, too. And, therefore is also tied to AT&T, so if you think a lot of iPhones and AT&T phones (iPhone is only available at AT&T), and wanna ride the Nokia good news -- check into SNCR if you like a higher risk, speculative stock. But we say it ain't that speculative, y'all. But be careful on that one. Maybe you just wanna watch SNCR to see if we called the right trend on it.
10 AM UPDATE: Oh my goodness...had to bust in with a one-hour update for the day-traders:
SNCR up 20% (must be on the Nokia News)
Nokia up 7%
Potash up 7%
Mosaic up 7%
Gold up $24.00
Yikes...ZD was very un-liquid and wasn't able to take his own advice. Unfortunately...No disclosure, y'all!
10:54 AM AMGEN Update: Amgen reports earnings today. They feel they will have a financially positive '08, in part due to layoffs that allowed them to reduce costs. Wall Street hates Amgen, right now, because of increased competition, Government investigations, and bad news on a bunch of their pipe dream future drugs. Analysts feel it may indeed take a big hit, but be up in '08. ZD says sell that sh*t right now, y'all. (They DID raise guidance, and they are saying the financial picture is A-OK, but you know Wall Street reacts like a bunch of spoiled crybabies, and if it isn't better than expected, it will tank, because they already don't like it for the reasons stated above. So I wouldn't take the chance that it may go up. I think you have to look more to the risk on this call. We will see.
INFLATION RATE IN '08: The Batcomputer just spit out a 7% inflation rate for '08. Hopefully, not enough to scare off the Fed from another rate cut at the next meeting.
ROUGE TRADER: Exposed today in France, the rouge trader cost his bank $7 Billion in losses. I bet if his options weren't due, down at historic proportions -- like everyone else's -- he wouldn't have been discovered. If true, it's the biggest fraud in history.
So here's the problem: Do you think this was the only guy in the entire world doing this? If not, how many more do we expect to see. Let's see Bush try and bail those out!
DOW CHEMICAL CEO ON CNBC: Was not allow to speak on his own company, because it is the slient period before earnings are announced. But ZD feels he just may have accidentally tipped his hat to sell before the announcement. Here's all I am basing it on: At the end of the interview, he said, "After earnings come out, remind me to tell you about our new strategy we will be announcing." Signaling to me, that he knows they will be under-performing expectations, (possibly because the high price of oil that they rely heavily upon/see below) -- and to please hold on because we have some exciting things to keep you hopeful. But he's planning on oil averaging $80 a barrel in '08. It hit $100 at the end of '08 and is at $87 today. (Batcomputer says, "Oil=going up!")
Dow sidebar: Since he couldn't speak on the company, he stuck to speaking about the price of oil in '08, which he says should average at $80 a barrel, but admitted he predicted it at $60 last year -- even though it was riding high in the $90s at year's end.
strategyupdate.com
Wednesday, January 23, 2008
Strategy Upadate Reader Mail and Future Market Prediction Analysis
(Originally posted on 1/22/08, right as the Fed made the emergency .75 point rate cut.)
Looks like all the Councilmembers were on the phone (1/22/08) with their stockbrokers due to the market crisis and they missed a quorum.
ZD predicted last Monday that the market would be low 12000-11999 today (1/22/08).
strategyupdate.com (click "daily blog link")
The fundamentals are all in place in our markets; there may be a temporary downturn, but everything is coming back stronger within just months. Bet on it.
First of all, although you may be correct that the market may rebound as you predict within just months.
HOWEVER...my prediction is based on a couple things that I hope you factored in:
a) Subprime is MUCH WORSE than accounted for at this point. You know about, "jingle mail". When subprimers end up owing more on their home than it is now worth (when their low-intro rate jumps to market rate). So banks are going to be stuck with all these homes that they cannot sell, that are also decreasing in value.
b) Bond insurance market: You heard that they are in trouble, and that the banks are writing off bigger losses than anyone imagined.
The credit derivative market starts coming due in February. And although "derivatives" are a little to confusing to explain here -- I'm sure you know about it.
When all the investors who never coulda though we'd be in the 11,000s -- well their gonna have to cover -- and it's gonna be a blood bath.
Then the banks will tank even more than expected.
* The only thing that has changed in my prediction is that today, there is chatter that the government may step in to bail out the bond insurers. So although they are not going to be able to prevent the inevitable -- it should delay the inevitable by a few months. (Possibly). But the bail out may not be here before the derivatives come due.
Which leads me to the next point:
Yeah, I made a prediction to sell today -- BEFORE THE FED CUT!!! I turned my back for two seconds to post the alert, then he cut...and the last thing I thought to do was post an update here, right away...because it was time to by some heavy metal, y'all!!!
So of course when you read something, and the Fed makes an announcement like that, everything changes. HOWEVER...the market WAS still down 400 at some point, and we're below 12,000!!! (Yikes!)
However...I STILL SAY, SOME FOLKS GOT LUCKY AND GOT THEIR GOLDEN OPPORTUNITY FOR A SECOND CHANCE TO SELL. Bro, you make it sound like the stock market closed for the last time ever, today.
Overall, with the Fed's emergency cut -- AND NOW...talk of a bond insurer bailout (the bond thing was the MAIN thing in the back of my mind that keeps me ultra-bearish),
you may want to take your chances.
Clint Eastwood has a question, "Feel lucky, PUNK?" (No disrespect meant.)
I'm saying I don't think the government will be able to keep it propped up in the long run...and we're gonna end up seeing those down 400 days that STICK!
AND...here's something that could be scary in the short run:
The Fed cut early, and people are expecting another .5% next meeting in two weeks. But we also know the Feds are a bunch of textbook, ivory tower douchebags. WHAT IF THIS WAS MERELY THE CUT THEY WERE GOING TO DO AT THE NEXT MEETING --- NOW, because if ZD predicted doomsday...I'm sure they saw it coming to. So we may not see a cut at the next meeting. Because, on the realest...although ZD like rate cuts from a Wall Street mindset...
inflation is off the shizzle, my nizzle. So I'm sure you understand further rate cuts would drive the dollar down, the oil sheiks will get pissed that they are holding cheap ass U.S. dollars and gas will rise and inflation will rise (at the pump and in most products).
SUMMARY: Yeah, the Fed made an emergency cut after my blog post -- and many people may think the coast is now clear. ZD says, "HELL NAW!"
(And my opinion will change based on these actions. OF COURSE THEY WOULD...a pilot has to change the course based on a change in weather condition.) BUT I'M NOT HEDGING, YET.
Not savvy enough to advise on foreign money, but I'll look into it. I would be scared of investing in overseas dollars now, cause you never know where (what country) and when we will see a rate cut, or not.
GOLD...HELLZ TO THE YEAH! Although I am Zuma Dogg, I too, am a mere mortal beneath the hat and glasses, so I may be right -- or wrong...but regarding GOLD as it relates to everything I've blogged about up until now -- I would simply start with buying gold manana, and not worry when it goes down a little*, because you are buying it as an investment for '08 and beyond.
(A "little" for gold could be down $50 dollars, or more, in the short run, with all of this volatility -- but with the dollar getting weaker with every Fed cut -- and inflation rising, if you think it is as I do, then gold is the #1 pick. As a gold stock, although the safest bet is the ETF called, "GLD", ZD has noticed that the stock "GOLD", (Rangold) always seems to be among the most UP mining stocks when gold is up -- and down the least when gold is down. Check the charts for '08 vs other gold mining stocks.)
But for the lower-risk takers -- safest bet (goes up the least, and down the least, but will trend up nice and slowly as gold rises...GLD. (ZD owns neither.)
They keep saying silver has the most potential to skyrocket, however, it always seems as gold takes all the UP glory. So, tomorrow would be a great day to buy silver -- early in the day -- if you believe silver will catch up, as it should. Why? The gold stocks were up by the end of the day, but silver was flat -- to down a percentage point, or two.
My silver guru confirmed for ZD's www.StrategyUpdate.com (see daily blog link) that silver DOES lag behind gold, so if gold was up today..silver should be up shortly thereafter. So tomorrow morning may be the time. BUT BE CAREFUL, I don't have a crystal ball, y'all.
But if I had cash, I would be buying gold and silver (but maybe less silver ONLY because it seems that logic doesn't matter as much as publicity, and GOLD comes to peoples' mind first -- AND it is more directly tied to the dollar, it seems. Silver is good, though, because it's used for electrical things.
Regarding other stocks...I would be sitting on the sidelines, because it's WAY too volatile -- and I think there will be further bottoming before the big comeback rally that may not be here for the next two years. HOWEVER...OF COURSE there are tons of great stocks to be buying, and I wish I COULD buy some tomorrow. (You can also short, and they have tons of ETFs that short specific sectors, commodities, and indexes. So if you think oil/gold/Dow Jones/retail/real estate/financials/etc is going up, or down there is an ETF that makes it easy to do for dummies like ZD.)
But I think gold is the best single bet for tomorrow if you are a long term investor.
(Click blue link and hit daily blog link if you haven't seen it yet. No update yet today.)
"Z DOGG PUT IT OUT THERE, AND ON THE LINE!!! You hung it out there, like a big blanket under the sun. Every one saw your statement. Everyone saw you were correct! Wow."
"That was balsy Zuma, I am not kidding you. But Don Quixote, myself, and everyone out there knows you prepared, you researched your inkling's, and came to the correct educated guess. That is what well prepared Chartered Financial Analyst do! What you did was just jaw dropping ZD! And I am happy to give you your much due congratulations. Amen. "For I already know the plans I have for you. I will help you, not hurt you. I will give you a future and a hope. You will call on me and I will answer. You will talk to me and I will listen. Jeremiah 29:11,12."
"Zuma you and your bat-computer are marvelous, and your regular readers on this blog are pure genius !!!!!"
"Zuma Dogg, thanks for the tips and info, especially knowing how busy you must be, I really appreciate it man. Yea I see today where the rest of the world is dumping and scared and I am too. Manana all my mutual funds and stock is being sold and I'm staying in cash and metals until things get a little more stable. I am too old anymore to be listening to stock brokers and real estate agents tell me about historic trends or if the glass is half empty or half full. Fuck that shit! I don't have the time or the patience anymore to wait around another ten or twenty years for pie in the sky bullshit."
"Thanks again for the great advice and your eloquent views on the economy."
"Hi, Zuma, It is very important for me to find out where the market is going. My husband and I invested his retirement in the market. So your information will be appreciated."
"Z Dogg this mornings post scared the shit out of me. You have been right on, concerning the gold and silver and that advice made me a little dinero, thanks!
But if you are saying that tues will be the day of reckoning , another historical black tuesday, and that all us "ordinary" investors will be sold down the river I am interested in having you expound on that a little, if you would be so kind. Should we move everything into gold, silver and cash? I'm very nervous about the economy so it wouldn't take much to get me to bail out even if it's a little permature, better late than never, so they say. - Thanks Zuma"
Strategy Update website (See 1/23/08 article on bond insurance and credit derivatives looming shoe to drop. Giant, giant shoes, from way high above!)
Looks like all the Councilmembers were on the phone (1/22/08) with their stockbrokers due to the market crisis and they missed a quorum.
ZD predicted last Monday that the market would be low 12000-11999 today (1/22/08).
strategyupdate.com (click "daily blog link")
The fundamentals are all in place in our markets; there may be a temporary downturn, but everything is coming back stronger within just months. Bet on it.
First of all, although you may be correct that the market may rebound as you predict within just months.
HOWEVER...my prediction is based on a couple things that I hope you factored in:
a) Subprime is MUCH WORSE than accounted for at this point. You know about, "jingle mail". When subprimers end up owing more on their home than it is now worth (when their low-intro rate jumps to market rate). So banks are going to be stuck with all these homes that they cannot sell, that are also decreasing in value.
b) Bond insurance market: You heard that they are in trouble, and that the banks are writing off bigger losses than anyone imagined.
The credit derivative market starts coming due in February. And although "derivatives" are a little to confusing to explain here -- I'm sure you know about it.
When all the investors who never coulda though we'd be in the 11,000s -- well their gonna have to cover -- and it's gonna be a blood bath.
Then the banks will tank even more than expected.
* The only thing that has changed in my prediction is that today, there is chatter that the government may step in to bail out the bond insurers. So although they are not going to be able to prevent the inevitable -- it should delay the inevitable by a few months. (Possibly). But the bail out may not be here before the derivatives come due.
Which leads me to the next point:
Yeah, I made a prediction to sell today -- BEFORE THE FED CUT!!! I turned my back for two seconds to post the alert, then he cut...and the last thing I thought to do was post an update here, right away...because it was time to by some heavy metal, y'all!!!
So of course when you read something, and the Fed makes an announcement like that, everything changes. HOWEVER...the market WAS still down 400 at some point, and we're below 12,000!!! (Yikes!)
However...I STILL SAY, SOME FOLKS GOT LUCKY AND GOT THEIR GOLDEN OPPORTUNITY FOR A SECOND CHANCE TO SELL. Bro, you make it sound like the stock market closed for the last time ever, today.
Overall, with the Fed's emergency cut -- AND NOW...talk of a bond insurer bailout (the bond thing was the MAIN thing in the back of my mind that keeps me ultra-bearish),
you may want to take your chances.
Clint Eastwood has a question, "Feel lucky, PUNK?" (No disrespect meant.)
I'm saying I don't think the government will be able to keep it propped up in the long run...and we're gonna end up seeing those down 400 days that STICK!
AND...here's something that could be scary in the short run:
The Fed cut early, and people are expecting another .5% next meeting in two weeks. But we also know the Feds are a bunch of textbook, ivory tower douchebags. WHAT IF THIS WAS MERELY THE CUT THEY WERE GOING TO DO AT THE NEXT MEETING --- NOW, because if ZD predicted doomsday...I'm sure they saw it coming to. So we may not see a cut at the next meeting. Because, on the realest...although ZD like rate cuts from a Wall Street mindset...
inflation is off the shizzle, my nizzle. So I'm sure you understand further rate cuts would drive the dollar down, the oil sheiks will get pissed that they are holding cheap ass U.S. dollars and gas will rise and inflation will rise (at the pump and in most products).
SUMMARY: Yeah, the Fed made an emergency cut after my blog post -- and many people may think the coast is now clear. ZD says, "HELL NAW!"
(And my opinion will change based on these actions. OF COURSE THEY WOULD...a pilot has to change the course based on a change in weather condition.) BUT I'M NOT HEDGING, YET.
Not savvy enough to advise on foreign money, but I'll look into it. I would be scared of investing in overseas dollars now, cause you never know where (what country) and when we will see a rate cut, or not.
GOLD...HELLZ TO THE YEAH! Although I am Zuma Dogg, I too, am a mere mortal beneath the hat and glasses, so I may be right -- or wrong...but regarding GOLD as it relates to everything I've blogged about up until now -- I would simply start with buying gold manana, and not worry when it goes down a little*, because you are buying it as an investment for '08 and beyond.
(A "little" for gold could be down $50 dollars, or more, in the short run, with all of this volatility -- but with the dollar getting weaker with every Fed cut -- and inflation rising, if you think it is as I do, then gold is the #1 pick. As a gold stock, although the safest bet is the ETF called, "GLD", ZD has noticed that the stock "GOLD", (Rangold) always seems to be among the most UP mining stocks when gold is up -- and down the least when gold is down. Check the charts for '08 vs other gold mining stocks.)
But for the lower-risk takers -- safest bet (goes up the least, and down the least, but will trend up nice and slowly as gold rises...GLD. (ZD owns neither.)
They keep saying silver has the most potential to skyrocket, however, it always seems as gold takes all the UP glory. So, tomorrow would be a great day to buy silver -- early in the day -- if you believe silver will catch up, as it should. Why? The gold stocks were up by the end of the day, but silver was flat -- to down a percentage point, or two.
My silver guru confirmed for ZD's www.StrategyUpdate.com (see daily blog link) that silver DOES lag behind gold, so if gold was up today..silver should be up shortly thereafter. So tomorrow morning may be the time. BUT BE CAREFUL, I don't have a crystal ball, y'all.
But if I had cash, I would be buying gold and silver (but maybe less silver ONLY because it seems that logic doesn't matter as much as publicity, and GOLD comes to peoples' mind first -- AND it is more directly tied to the dollar, it seems. Silver is good, though, because it's used for electrical things.
Regarding other stocks...I would be sitting on the sidelines, because it's WAY too volatile -- and I think there will be further bottoming before the big comeback rally that may not be here for the next two years. HOWEVER...OF COURSE there are tons of great stocks to be buying, and I wish I COULD buy some tomorrow. (You can also short, and they have tons of ETFs that short specific sectors, commodities, and indexes. So if you think oil/gold/Dow Jones/retail/real estate/financials/etc is going up, or down there is an ETF that makes it easy to do for dummies like ZD.)
But I think gold is the best single bet for tomorrow if you are a long term investor.
(Click blue link and hit daily blog link if you haven't seen it yet. No update yet today.)
"Z DOGG PUT IT OUT THERE, AND ON THE LINE!!! You hung it out there, like a big blanket under the sun. Every one saw your statement. Everyone saw you were correct! Wow."
"That was balsy Zuma, I am not kidding you. But Don Quixote, myself, and everyone out there knows you prepared, you researched your inkling's, and came to the correct educated guess. That is what well prepared Chartered Financial Analyst do! What you did was just jaw dropping ZD! And I am happy to give you your much due congratulations. Amen. "For I already know the plans I have for you. I will help you, not hurt you. I will give you a future and a hope. You will call on me and I will answer. You will talk to me and I will listen. Jeremiah 29:11,12."
"Zuma you and your bat-computer are marvelous, and your regular readers on this blog are pure genius !!!!!"
"Zuma Dogg, thanks for the tips and info, especially knowing how busy you must be, I really appreciate it man. Yea I see today where the rest of the world is dumping and scared and I am too. Manana all my mutual funds and stock is being sold and I'm staying in cash and metals until things get a little more stable. I am too old anymore to be listening to stock brokers and real estate agents tell me about historic trends or if the glass is half empty or half full. Fuck that shit! I don't have the time or the patience anymore to wait around another ten or twenty years for pie in the sky bullshit."
"Thanks again for the great advice and your eloquent views on the economy."
"Hi, Zuma, It is very important for me to find out where the market is going. My husband and I invested his retirement in the market. So your information will be appreciated."
"Z Dogg this mornings post scared the shit out of me. You have been right on, concerning the gold and silver and that advice made me a little dinero, thanks!
But if you are saying that tues will be the day of reckoning , another historical black tuesday, and that all us "ordinary" investors will be sold down the river I am interested in having you expound on that a little, if you would be so kind. Should we move everything into gold, silver and cash? I'm very nervous about the economy so it wouldn't take much to get me to bail out even if it's a little permature, better late than never, so they say. - Thanks Zuma"
Strategy Update website (See 1/23/08 article on bond insurance and credit derivatives looming shoe to drop. Giant, giant shoes, from way high above!)
1/23/08 Stock Market Update -- NOT PRETTY!
I missed blogging this here, on this blog -- because I was busy on another Los Angeles based blog I contribute to.
Here was the pre-bell post, I usually put here first:
Meanwhile, although I wish everyone sold before the opening bell on January 2, 2008 -- as I urged all who I spoke with. And I wish everyone sold, every time it was recommended on this blog since then (see previous threads).
So now, I don't know what to tell you about selling. But if I were one of these heavy traders, I would be on the sidelines watching, for the most part -- HOWEVER... I would also be buying certain things like an insane madman!
Overall though, my Batcomputer continues to be on "Warning" mode, because it still feels there are much bigger shoes to drop regarding the subprime real estate and financial markets. BIG ONES, Y'ALL!!!
Man is that credit derivative and bond insurance issue going to be the shoe-drop that knocks out the world!!! And that's the reason I am still extra, extra cautious -- even though, of course, people will be getting rich in the long run off of things they buy today...RIGHT NOW!!!
Long term: Still like gold as the place to be when the shoe drops. Get your positions now! (Especially if you thing Bertankie is going to cut some more at the next meeting. I'm not so optimistic. See thread below.)
And here is the article of the day that will explain this bond insurers crisis that is going to be the shot heard around the world. Coming soon to a global economy near you! Click here for the 1/23/08 article on Strategy Update website.
contact@strategyupdate.com
Here was the pre-bell post, I usually put here first:
Meanwhile, although I wish everyone sold before the opening bell on January 2, 2008 -- as I urged all who I spoke with. And I wish everyone sold, every time it was recommended on this blog since then (see previous threads).
So now, I don't know what to tell you about selling. But if I were one of these heavy traders, I would be on the sidelines watching, for the most part -- HOWEVER... I would also be buying certain things like an insane madman!
Overall though, my Batcomputer continues to be on "Warning" mode, because it still feels there are much bigger shoes to drop regarding the subprime real estate and financial markets. BIG ONES, Y'ALL!!!
Man is that credit derivative and bond insurance issue going to be the shoe-drop that knocks out the world!!! And that's the reason I am still extra, extra cautious -- even though, of course, people will be getting rich in the long run off of things they buy today...RIGHT NOW!!!
Long term: Still like gold as the place to be when the shoe drops. Get your positions now! (Especially if you thing Bertankie is going to cut some more at the next meeting. I'm not so optimistic. See thread below.)
And here is the article of the day that will explain this bond insurers crisis that is going to be the shot heard around the world. Coming soon to a global economy near you! Click here for the 1/23/08 article on Strategy Update website.
contact@strategyupdate.com
Thursday, January 17, 2008
STIMULATE THIS: U.S. Economic Stimulus Package Ain't Gonna Pass, and if it does, it wont make a dent
STIMULATE THIS: First of all, do you really think you are going to get the Democrats and Republicans to agree on a complex financial issue like this that includes a social element? HELL NAW! But even if Verne Troyer suddenly becomes the next big NBA superstar, all four Beatles reunite and MTV starts playing good music videos again -- and the U.S. Government actually approves any kind of economic "package" ("package" means "complicated -- as in the kind that never gets approved), it ain't gonna be nothing but a drip in the bucket. (Not even a full drop.)
You know the degree government is able to make an impact on something like this! Sending someone a check for $250 or $500 is not going to make a difference. Then, do you think the people will invest it as intended into the housing market -- or head over to Best Buy?
Meanwhile, I heard it is so hard to get credit/a loan from a bank now, even Warren Buffet was just rejected for a two hundred dollar loan that he promised to pay back by next Tuesday.
If people's arms started falling off, all across the country -- and everyone started bleeding to death from the wound...Washington would be there to offer "one free band-aid for all!"
JINGLE MAIL: In related matter, I know a lot of people feel we are near the bottom of the housing crisis. I think we are at the bottom, too...the bottom of the beginning, that is. So I hope you enjoyed the appetizer.
Here's what's next: Well, now since people owe more on their homes than they are now worth (since the recent drop in value), people are making the prudent fiscal decision. Simply walking away from the loan and the home. So they take the keys to the home, put them in an envelope and send them to the bank. (Just like hotel keys!)
Then, when the bank gets the envelope and hear those keys jingling -- they know another one bites the dust. So banks are going to have a whole bunch of homes on their hands, that they cannot sell, and are dropping in value as I type this. PLUS, the double-whammy of not taking in any monthly payment at all! So look for some HARDCORE housing and banking credit news to unravel before your eyes this year.
Although I don't think it's something that government should be mandating (the way Clinton suggested), I do absolutely agree that any smart bank CEO would tell subprime clients -- we'll keep you locked in at the same rate -- or only raise it a little...so that the bank can take in SOME money, and people don't have to move. There will be undertow effects of people moving out of their homes. In California, where you have the most of these subprime situations, you may see entire communities go south -- stores and business will be forced to close -- and then they turn into crime and poverty zones. Think about it.
CREDIT/DERIVATIVES MARKET: The credit (card) situation isn't any better. More and more people will be later and later on their payments -- and you'll see a rise in people who default altogether and walk away from their credit card payments, too.
INFLATION NUMBERS: The inflation number for the first month of the year was released yesterday. It wasn't too much higher than expected...however, it was the biggest increase in the inflation numbers in 17 years (2000). Check this blog and my other blogs. Not only did we predict the subprime mortgage crisis and recession in May 2007 -- but have also been saying inflation would be higher in '08 than anyone is talking about. (Not bragging about the insights of my strategy consultants...but trying to get you to pay attention for the future.
And remember, I was never scoffed harder for suggesting to buy Apple stock, based on the iPod. THE STOCK WAS AT $15 per share at the time. But when I told everyone to sell at $200, no one wanted to sell, because stocks alway continue to only go up...remember!?!?! And what if you sold at $200 and it goes up even more?
It's not a condo, or cement handprints at Mann's Chinese Theater that you are locked in to. If you see the trend continue to rise...you can buy it again. (Duh!) But then you might pay $2 a share more...so hold on, and lose $40 a share out of greed. (LOL!)
BERNAKIE: I call him, "Bertankie" because that's what he is doing to the world economy. I LOVE how he is saying, "We are ready to take substantive action and do whatever it takes...blah, blah, blah." WHAT THE F*CK ARE YOU WAITING FOR? Are you Hellen Keller, Ben? If you were a fireman, you would be standing with the hose while people are running out of the building screaming, "FIRE, FIRE!!!" I bet Bernakie is just hearing about this upcoming music trend called "hip-hop". He hears it gonna be all the sensation. Ben just made a prediction...The New England Patriots are going to have a good season. He's so behind the curve he is actually ahead of his time!
MUTUAL FUNDS: Please don't be one of these naive idiots who tells me, "I'm not concerned about stock market volatility -- I'm in safe mutual funds, and those are highly managed by experts. EXCUSE ME!!! MUTUAL FUNDS ARE MADE UP OF STOCKS!!! If the Dow Jones went from 13,500 to 12,500 in a month -- and the "A" stocks like Apple have dropped from $200 to $160 (along with ALL STOCKS)...why would you think mutual funds are not getting hammered proportionately? (Faith, hope and optimism I guess.)
ETF Funds: On the rise, with more and more popping up and over $60 billion invested in ETF funds. They are the new "mutual funds", and they may give you more control over sector selection, and the fees end up costing you less than Mutual Funds. And you can buy ETFs that short markets, too. Which is a lot easier than trying to short on your own.
STOCK MARKET VOLATILITY: I know you think we have already seen the big sell off...but the charts say we have not actually had the big shoe drop yet. Monday, I predicted the Dow Jones would hit 11,500 before 13,5000. I've been saying since October that all money should be out of the stock market by Dec 31, 2007, in time for the '08 opening bell. Then, after eight down days -- and one up day -- people felt we hit the bottom. But this blog was here to say, "Not so fast you optimists" -- and I think in early February, we will be looking back at today saying, "Ah...remember the good old days of last month, when there was hope we would be back up into 13000 territory, and Apple is gonna rally back to $200.
Don't even ask me about the time I stood on the restaurant table and screamed SELL STARBUCKS while still in the $23 range. (I even threw in the outrageous claim that it would hit $19 before $25.) I was told I was full of sh*t, because Starbucks was at $38 at one time and everyone just wanted to wait until it went back up a little. WELL...now it probably WILL be going up: From the $19 range. (LMFAO!) So please...keep ignoring everything and trust in "hope and optimism."
Maybe Ward Cleaver will be showing up to the next community softball game, too. And Aunt Bea will have lemonade!
UPDATES MAY APPEAR ON THIS THREAD THROUGHOUT THE DAY
StrategyUpdate.com
You know the degree government is able to make an impact on something like this! Sending someone a check for $250 or $500 is not going to make a difference. Then, do you think the people will invest it as intended into the housing market -- or head over to Best Buy?
Meanwhile, I heard it is so hard to get credit/a loan from a bank now, even Warren Buffet was just rejected for a two hundred dollar loan that he promised to pay back by next Tuesday.
If people's arms started falling off, all across the country -- and everyone started bleeding to death from the wound...Washington would be there to offer "one free band-aid for all!"
JINGLE MAIL: In related matter, I know a lot of people feel we are near the bottom of the housing crisis. I think we are at the bottom, too...the bottom of the beginning, that is. So I hope you enjoyed the appetizer.
Here's what's next: Well, now since people owe more on their homes than they are now worth (since the recent drop in value), people are making the prudent fiscal decision. Simply walking away from the loan and the home. So they take the keys to the home, put them in an envelope and send them to the bank. (Just like hotel keys!)
Then, when the bank gets the envelope and hear those keys jingling -- they know another one bites the dust. So banks are going to have a whole bunch of homes on their hands, that they cannot sell, and are dropping in value as I type this. PLUS, the double-whammy of not taking in any monthly payment at all! So look for some HARDCORE housing and banking credit news to unravel before your eyes this year.
Although I don't think it's something that government should be mandating (the way Clinton suggested), I do absolutely agree that any smart bank CEO would tell subprime clients -- we'll keep you locked in at the same rate -- or only raise it a little...so that the bank can take in SOME money, and people don't have to move. There will be undertow effects of people moving out of their homes. In California, where you have the most of these subprime situations, you may see entire communities go south -- stores and business will be forced to close -- and then they turn into crime and poverty zones. Think about it.
CREDIT/DERIVATIVES MARKET: The credit (card) situation isn't any better. More and more people will be later and later on their payments -- and you'll see a rise in people who default altogether and walk away from their credit card payments, too.
INFLATION NUMBERS: The inflation number for the first month of the year was released yesterday. It wasn't too much higher than expected...however, it was the biggest increase in the inflation numbers in 17 years (2000). Check this blog and my other blogs. Not only did we predict the subprime mortgage crisis and recession in May 2007 -- but have also been saying inflation would be higher in '08 than anyone is talking about. (Not bragging about the insights of my strategy consultants...but trying to get you to pay attention for the future.
And remember, I was never scoffed harder for suggesting to buy Apple stock, based on the iPod. THE STOCK WAS AT $15 per share at the time. But when I told everyone to sell at $200, no one wanted to sell, because stocks alway continue to only go up...remember!?!?! And what if you sold at $200 and it goes up even more?
It's not a condo, or cement handprints at Mann's Chinese Theater that you are locked in to. If you see the trend continue to rise...you can buy it again. (Duh!) But then you might pay $2 a share more...so hold on, and lose $40 a share out of greed. (LOL!)
BERNAKIE: I call him, "Bertankie" because that's what he is doing to the world economy. I LOVE how he is saying, "We are ready to take substantive action and do whatever it takes...blah, blah, blah." WHAT THE F*CK ARE YOU WAITING FOR? Are you Hellen Keller, Ben? If you were a fireman, you would be standing with the hose while people are running out of the building screaming, "FIRE, FIRE!!!" I bet Bernakie is just hearing about this upcoming music trend called "hip-hop". He hears it gonna be all the sensation. Ben just made a prediction...The New England Patriots are going to have a good season. He's so behind the curve he is actually ahead of his time!
MUTUAL FUNDS: Please don't be one of these naive idiots who tells me, "I'm not concerned about stock market volatility -- I'm in safe mutual funds, and those are highly managed by experts. EXCUSE ME!!! MUTUAL FUNDS ARE MADE UP OF STOCKS!!! If the Dow Jones went from 13,500 to 12,500 in a month -- and the "A" stocks like Apple have dropped from $200 to $160 (along with ALL STOCKS)...why would you think mutual funds are not getting hammered proportionately? (Faith, hope and optimism I guess.)
ETF Funds: On the rise, with more and more popping up and over $60 billion invested in ETF funds. They are the new "mutual funds", and they may give you more control over sector selection, and the fees end up costing you less than Mutual Funds. And you can buy ETFs that short markets, too. Which is a lot easier than trying to short on your own.
STOCK MARKET VOLATILITY: I know you think we have already seen the big sell off...but the charts say we have not actually had the big shoe drop yet. Monday, I predicted the Dow Jones would hit 11,500 before 13,5000. I've been saying since October that all money should be out of the stock market by Dec 31, 2007, in time for the '08 opening bell. Then, after eight down days -- and one up day -- people felt we hit the bottom. But this blog was here to say, "Not so fast you optimists" -- and I think in early February, we will be looking back at today saying, "Ah...remember the good old days of last month, when there was hope we would be back up into 13000 territory, and Apple is gonna rally back to $200.
Don't even ask me about the time I stood on the restaurant table and screamed SELL STARBUCKS while still in the $23 range. (I even threw in the outrageous claim that it would hit $19 before $25.) I was told I was full of sh*t, because Starbucks was at $38 at one time and everyone just wanted to wait until it went back up a little. WELL...now it probably WILL be going up: From the $19 range. (LMFAO!) So please...keep ignoring everything and trust in "hope and optimism."
Maybe Ward Cleaver will be showing up to the next community softball game, too. And Aunt Bea will have lemonade!
UPDATES MAY APPEAR ON THIS THREAD THROUGHOUT THE DAY
StrategyUpdate.com
Tuesday, January 15, 2008
INVESTOR ALERT: GOLD IS GOING TO TANK ON WED JAN 16th
The headline says it all.
Two things happened on Tuesday. We found out that more U.S. banks are going to be bailed out with an infusion of overseas cash -- and gold went down after a record skyrocket.
RIYADH/KUWAIT (Reuters) - Saudi Prince Alwaleed bin Talal and Kuwait agreed to invest at least $5 billion in Citigroup Inc and Merrill Lynch & Co as the two U.S. banks scramble for capital after billions in writedowns.
So, how do you think these investors/oil producers pay for the cash infusion into these banks?
Well, before they hit the "send" button on their paypal to Citibank, they have to sell tons of gold to pay for the investment.
If you look at the 24 hour gold chart, you can see when the withdraw from the ATM was made. (The sell of gold to pay for the U.S. bank investment/bail-out.) Monday at 12 noon; and in the 11pm hour, just before midnight.
And a lot of people are hoping this will put enough confidence back into stocks, that the market may rally back a little, instead of sinking further.
IT WILL SINK FURTHER ON WEDNESDAY...AND GOLD WILL CONTINUE TO DROP.
But don't worry...well, go ahead and worry...but keep in mind, as you DO worry...that gold will go back up, cause inflation is out of control, oil will be going back up, the dollar will be dropping and Berntankie will still have to cut the rate, which will drive up gold further.
So the point is...although if you are holding gold (or silver) as a long term investment, you are going to be happy in February and beyond. But if you want to jump on the gold/silver bandwagon...Wed Jan 16th is not the day. In other words, it will be lower by the end of the day.
24 hour gold and silver charts at strategyupdate.com.
Disclosure: AUY, KGC
Two things happened on Tuesday. We found out that more U.S. banks are going to be bailed out with an infusion of overseas cash -- and gold went down after a record skyrocket.
RIYADH/KUWAIT (Reuters) - Saudi Prince Alwaleed bin Talal and Kuwait agreed to invest at least $5 billion in Citigroup Inc and Merrill Lynch & Co as the two U.S. banks scramble for capital after billions in writedowns.
So, how do you think these investors/oil producers pay for the cash infusion into these banks?
Well, before they hit the "send" button on their paypal to Citibank, they have to sell tons of gold to pay for the investment.
If you look at the 24 hour gold chart, you can see when the withdraw from the ATM was made. (The sell of gold to pay for the U.S. bank investment/bail-out.) Monday at 12 noon; and in the 11pm hour, just before midnight.
And a lot of people are hoping this will put enough confidence back into stocks, that the market may rally back a little, instead of sinking further.
IT WILL SINK FURTHER ON WEDNESDAY...AND GOLD WILL CONTINUE TO DROP.
But don't worry...well, go ahead and worry...but keep in mind, as you DO worry...that gold will go back up, cause inflation is out of control, oil will be going back up, the dollar will be dropping and Berntankie will still have to cut the rate, which will drive up gold further.
So the point is...although if you are holding gold (or silver) as a long term investment, you are going to be happy in February and beyond. But if you want to jump on the gold/silver bandwagon...Wed Jan 16th is not the day. In other words, it will be lower by the end of the day.
24 hour gold and silver charts at strategyupdate.com.
Disclosure: AUY, KGC
As The Market Continues To Tank...Remember Bernakie is RIGHT...The Rest of the World Must Be Wrong
IGNORE REALITIES...BEN BERTANKIE KNOWS BEST: Not a fun day with the Dow Jones being down a-nother 277 points -- after some pretty big givebacks already this year. And it ain't over yet. (The slide, that is/see "tomorrow morning".)
But despite how the rest of the world is reacting to the global economy...remember...market realities don't mean squat. Ben Bernakie has been correct all along, and please ignore the global slide into recession and the biggest market decline since the great depression of the '30's. Ben has been checking his Princeton charts and is figuring out what to do.
WHY GOLD WENT DOWN TODAY? No, not because it was at record levels. "Commodities King" Dennis Gartman had a good explanation as to what may have happened today. He says, that if you noticed, gold was up at the start of the day. Then, as stocks took a HUGE dive (one too many this year), people had to meet margin calls, and the only thing in the portfolio with a profit to take is gold.
AND -- you may have had some additional "forced/artificial deflation" of gold today. One market insider tells Strategy Update that you have some people in the mid-east that were selling off gold like crazy, trying to make it drop -- before the market tanks to 0.00 and there is nothing left.
BUSH TRIES TO BRING DOWN OIL PRICE: And you saw crude oil drop today, too. But don't look for George Bush's plea to have oil sheiks up production so as to help deflate the price of oil, too. Unfortunately...FIRST OF ALL...it's not like these people can just pull all this oil out of their ass at a moments notice. It's not gonna be that easy...who says they have so much extra oil hanging around? Experts say they do not.
Secondly, the oil producers say, "Well gee, we can up production, but who says the U.S. will be there to fill the demand? The world is scared that the U.S. will be cutting back on consumption even if they raise production levels. AND -- they are not expecting a pull back on demand, anyway. China and other emerging world markets will keep demand pumping along.
So long term, gold and oil should be going back up...a lot! WAIT UNTIL EVERYONE STARTS DEFAULTING ON THEIR CREDIT PAYMENTS AND THE DERIVATIVE MARKET SENDS THE MARKET SINKING LIKE A LEAD ANVIL IN QUICKSAND.
The market is going to tank again at the opening bell on Wednesday...and I think come February, March...people will wish they sold all stocks and took whatever losses they incurred.
But people are overly hopeful and optimistic. We will see the Dow hit 11,500 before 13,500.
THE PROBLEM WITH MORNING STAR & STOCK RATERS: I recently told someone who I didn't want to see lose money that their stock was toast and that even though it is way down -- sell now and take the losses. And added that they never should have let the stock drop 50% in the first place. They were quick to respond with, "What about the five star rating with Morning Star?" Well, that's all well and good, except these ratings don't take into account that the Dow Jones is going to drop from 13,500 to 12,500 in only thirteen trading days due to factors that had nothing to do with the fantastic company. Oh well.
Who the hell am I? The guy who blogged in May '07 about the subprime crisis that would trigger a year long recession starting in November. Then, told everyone to sell Apple at $200, even though no one did, because they felt the stock was called, "infinity", not "apple".
AND, when I sent out notices to family and friends in October, November and December urging them to "sell all stocks and mutual funds by Dec 31, 2007 -- in advance of January '08...
WELL...no one wanted to do that, because people don't like to only make 4% interest. They would rather lose 50% of their portfolio value. But that's o.k., because it's always about to skyrocket back up. (At least that's what they told me about Starbucks at $28, $26, $23, $20...they're still holding on -- even though they bought it at $36 and today it's at 18.84.
And to everyone I told sell Apple when it worked it's way back up to $180. Well that wasn't good enough, cause it was at $200 a few weeks ago. (Exactly. This ain't a few weeks ago anymore. HOW IS APPLE GOING TO HIT $200 ANYTIME SOON, WHEN THE MARKET IS COMPLETELY DIFFERENT THAN IT WAS WHEN IT HIT $200. (That goes for all you "record high" stock holders who didn't take profits.)
Yes, I'm bitter. So I started this blog so I can put it all down for the record and my friends and family can just look here to see what to do, instead of me having to beg and plea with them.
strategyupdate.com
Disclousre: AUY, KGC
But despite how the rest of the world is reacting to the global economy...remember...market realities don't mean squat. Ben Bernakie has been correct all along, and please ignore the global slide into recession and the biggest market decline since the great depression of the '30's. Ben has been checking his Princeton charts and is figuring out what to do.
WHY GOLD WENT DOWN TODAY? No, not because it was at record levels. "Commodities King" Dennis Gartman had a good explanation as to what may have happened today. He says, that if you noticed, gold was up at the start of the day. Then, as stocks took a HUGE dive (one too many this year), people had to meet margin calls, and the only thing in the portfolio with a profit to take is gold.
AND -- you may have had some additional "forced/artificial deflation" of gold today. One market insider tells Strategy Update that you have some people in the mid-east that were selling off gold like crazy, trying to make it drop -- before the market tanks to 0.00 and there is nothing left.
BUSH TRIES TO BRING DOWN OIL PRICE: And you saw crude oil drop today, too. But don't look for George Bush's plea to have oil sheiks up production so as to help deflate the price of oil, too. Unfortunately...FIRST OF ALL...it's not like these people can just pull all this oil out of their ass at a moments notice. It's not gonna be that easy...who says they have so much extra oil hanging around? Experts say they do not.
Secondly, the oil producers say, "Well gee, we can up production, but who says the U.S. will be there to fill the demand? The world is scared that the U.S. will be cutting back on consumption even if they raise production levels. AND -- they are not expecting a pull back on demand, anyway. China and other emerging world markets will keep demand pumping along.
So long term, gold and oil should be going back up...a lot! WAIT UNTIL EVERYONE STARTS DEFAULTING ON THEIR CREDIT PAYMENTS AND THE DERIVATIVE MARKET SENDS THE MARKET SINKING LIKE A LEAD ANVIL IN QUICKSAND.
The market is going to tank again at the opening bell on Wednesday...and I think come February, March...people will wish they sold all stocks and took whatever losses they incurred.
But people are overly hopeful and optimistic. We will see the Dow hit 11,500 before 13,500.
THE PROBLEM WITH MORNING STAR & STOCK RATERS: I recently told someone who I didn't want to see lose money that their stock was toast and that even though it is way down -- sell now and take the losses. And added that they never should have let the stock drop 50% in the first place. They were quick to respond with, "What about the five star rating with Morning Star?" Well, that's all well and good, except these ratings don't take into account that the Dow Jones is going to drop from 13,500 to 12,500 in only thirteen trading days due to factors that had nothing to do with the fantastic company. Oh well.
Who the hell am I? The guy who blogged in May '07 about the subprime crisis that would trigger a year long recession starting in November. Then, told everyone to sell Apple at $200, even though no one did, because they felt the stock was called, "infinity", not "apple".
AND, when I sent out notices to family and friends in October, November and December urging them to "sell all stocks and mutual funds by Dec 31, 2007 -- in advance of January '08...
WELL...no one wanted to do that, because people don't like to only make 4% interest. They would rather lose 50% of their portfolio value. But that's o.k., because it's always about to skyrocket back up. (At least that's what they told me about Starbucks at $28, $26, $23, $20...they're still holding on -- even though they bought it at $36 and today it's at 18.84.
And to everyone I told sell Apple when it worked it's way back up to $180. Well that wasn't good enough, cause it was at $200 a few weeks ago. (Exactly. This ain't a few weeks ago anymore. HOW IS APPLE GOING TO HIT $200 ANYTIME SOON, WHEN THE MARKET IS COMPLETELY DIFFERENT THAN IT WAS WHEN IT HIT $200. (That goes for all you "record high" stock holders who didn't take profits.)
Yes, I'm bitter. So I started this blog so I can put it all down for the record and my friends and family can just look here to see what to do, instead of me having to beg and plea with them.
strategyupdate.com
Disclousre: AUY, KGC
Sunday, January 13, 2008
Pre Market Predictions for Monday Jan 14, 2008 (Not Good)
Just when you think the market can't go down any more after already going down about 1000 points since Christmas, including an additional 246 point give-back on Friday, for a depressing low of 12,606 -- it's going to! (So much for kicking off 2008 at 14,000.)
So you think, "Ouch! I've never seen anything like this?!?!? This has to be the bottom. It can't go down anymore...it always goes back up -- after it has been down this much. (That's what you though on Thursday before it dropped another 246.)
This week, many banks will be reporting earnings, and sources say the news ain't gonna be good. As a matter of fact, much worse than expected with massive write-downs. So even though the market is already down...do you think it will go up, or down -- based on all the bad financial news that will be hitting this week?
We could be in the 11,000 range by week's end. [Low 12's/high 11's]
I know that's a bold prediction, and I hope it won't happen. But if I had to bet if were hitting 11,999 before 12,999...I'm going with 11,999.
The main point of this thread is to remind you to sell all stocks as soon as possible. (Pre-market trading, if you can.) That's right...you're entire portfolio. Why would you want to hang onto things if you know it's going south?
With the banks releasing earnings this week, you may as well avoid the anvil like free-fall -- and not give back another 600 points (hopefully ONLY 600), just when you thought we hit the bottom and were ready for it to go back up.
I know it's a doomsday scenario. Just trying to make a point. And that is, "Just because the market has been your worst nightmare this year...doesn't mean the credits have rolled yet." (And I say we are not into the final scene.)
strategyupdate.com
Disclosure: AUY, MOS
So you think, "Ouch! I've never seen anything like this?!?!? This has to be the bottom. It can't go down anymore...it always goes back up -- after it has been down this much. (That's what you though on Thursday before it dropped another 246.)
This week, many banks will be reporting earnings, and sources say the news ain't gonna be good. As a matter of fact, much worse than expected with massive write-downs. So even though the market is already down...do you think it will go up, or down -- based on all the bad financial news that will be hitting this week?
We could be in the 11,000 range by week's end. [Low 12's/high 11's]
I know that's a bold prediction, and I hope it won't happen. But if I had to bet if were hitting 11,999 before 12,999...I'm going with 11,999.
The main point of this thread is to remind you to sell all stocks as soon as possible. (Pre-market trading, if you can.) That's right...you're entire portfolio. Why would you want to hang onto things if you know it's going south?
With the banks releasing earnings this week, you may as well avoid the anvil like free-fall -- and not give back another 600 points (hopefully ONLY 600), just when you thought we hit the bottom and were ready for it to go back up.
I know it's a doomsday scenario. Just trying to make a point. And that is, "Just because the market has been your worst nightmare this year...doesn't mean the credits have rolled yet." (And I say we are not into the final scene.)
strategyupdate.com
Disclosure: AUY, MOS
Friday, January 11, 2008
INVESTOR ALERT: Will AGRICULTURE End Up Being The Story of The Decade? (Or Century?)
What worked in '07, may not work in '08 and beyond. People are used to seeing certain trends and cycles in the market. In the past, if you saw your stock drop from $200 a share, to $150 a share -- most long term investors wouldn't worry -- knowing you can always expect things to rally back eventually.
However, our sources feel we may have felt a fundamental shift as the calendar went from '07, to '08. So if it is true that some of the sectors you used to look to as a "safe", "conservative", "no-brainer" play, may be today's worst nightmare.
And similarly, those areas that used to be a "no way", should now be a "right away".
First of all, the "gold" cat is out of the bag in the first month of '08. First, as investors worry about the high price of oil -- and fear of rebel attacks in Nigeria and elsewhere in the world that may threaten supply. (And the fear, alone, is enough to keep the price higher than supply and demand would merit.)
Then, yesterday Bernakie made all those comments about the need to be flexible and take "substantive action" to do whatever it takes to keep the global economy from slipping away into a black hole.
But of course, that means the dollar will become weaker; oil prices will increase; inflation will rise, affecting the production of food, plastic and other products.
So what is good for the market, isn't always good for everyone else. But this is the way it appears to be headed, at least in the perception of market investors. So that has become the reality. And as we have seen gold rise and maintain record high levels, CNBC has just reported that, "More Central Banks are buying gold." (So that's a real shift in perception compared to what we have seen in the past regarding the confidence of gold investing by safe, conservative banks.)
Secondly, as the headline indicated, sources indicate that agriculture will be the other shift in investor perception. There is a world population boom and these people will have to eat. Also, as other world markets like China and others grow and people move up in the world, they want to improve their diets with more meat and chicken and protein. (And you gotta feed the livestock, along with the people!)
People may look at what has happened to the price of wheat and corn and agriculture stocks like Monsanto and say, "Oh, those prices are way too high. It's gotta come down. This is B.S.! Stay away from commodities. We have seen spikes in the past, only to come back down."
OUR SOURCES SAY IN THE PAST, high spikes up in the price of wheat (for example) were due to supply problems. (A drought or freeze or whatever.) This time, it's due to demand. An increase in demand. And it doesn't appear as though it is a trend that will be reversing anytime soon.
It's already 2008, so it may not be the biggest story of THIS decade...but Strategy Update says Agriculture and the demand for wheat, corn, beans, fertilizer and related products will be the story of the next decade. But the money is to be made starting...
NOW!
strategyupdate.com
Disclosure: MOS
However, our sources feel we may have felt a fundamental shift as the calendar went from '07, to '08. So if it is true that some of the sectors you used to look to as a "safe", "conservative", "no-brainer" play, may be today's worst nightmare.
And similarly, those areas that used to be a "no way", should now be a "right away".
First of all, the "gold" cat is out of the bag in the first month of '08. First, as investors worry about the high price of oil -- and fear of rebel attacks in Nigeria and elsewhere in the world that may threaten supply. (And the fear, alone, is enough to keep the price higher than supply and demand would merit.)
Then, yesterday Bernakie made all those comments about the need to be flexible and take "substantive action" to do whatever it takes to keep the global economy from slipping away into a black hole.
But of course, that means the dollar will become weaker; oil prices will increase; inflation will rise, affecting the production of food, plastic and other products.
So what is good for the market, isn't always good for everyone else. But this is the way it appears to be headed, at least in the perception of market investors. So that has become the reality. And as we have seen gold rise and maintain record high levels, CNBC has just reported that, "More Central Banks are buying gold." (So that's a real shift in perception compared to what we have seen in the past regarding the confidence of gold investing by safe, conservative banks.)
Secondly, as the headline indicated, sources indicate that agriculture will be the other shift in investor perception. There is a world population boom and these people will have to eat. Also, as other world markets like China and others grow and people move up in the world, they want to improve their diets with more meat and chicken and protein. (And you gotta feed the livestock, along with the people!)
People may look at what has happened to the price of wheat and corn and agriculture stocks like Monsanto and say, "Oh, those prices are way too high. It's gotta come down. This is B.S.! Stay away from commodities. We have seen spikes in the past, only to come back down."
OUR SOURCES SAY IN THE PAST, high spikes up in the price of wheat (for example) were due to supply problems. (A drought or freeze or whatever.) This time, it's due to demand. An increase in demand. And it doesn't appear as though it is a trend that will be reversing anytime soon.
It's already 2008, so it may not be the biggest story of THIS decade...but Strategy Update says Agriculture and the demand for wheat, corn, beans, fertilizer and related products will be the story of the next decade. But the money is to be made starting...
NOW!
strategyupdate.com
Disclosure: MOS
Thursday, January 10, 2008
Gold Isn't The Only Metal That Will Be Going Up With A Fed Rate Cut -- REMEMBER SILVER!
i checked into silver today...it's gonna go up in '08...but i hear it goes up, then down -- a little at a time. my bat-computer, says silver has never been up seven days in a row, without going back down (or something like that), so it says unless you are a "shorter"...it can drop to $15.36, before it goes much higher than today's $16.30 high.
ONLY THING I BROUGHT THE BAT-COMPUTER'S ATTENTION...with people expecting the rate cut -- and people scared of inflation --- and the move to gold and silver, more than ever in '08-- silver may extend the "up" trend longer than usual -- before it drops down. Bat-computer says the charts don't lie, and silver WILL be going back down to 15.36.
But the thing about computers, they don't factor in "emotions". We're seeing things we have never seen before, so why not a little bit longer of a long streak?
BUT, all of that stuff is for traders. as an investor, you can't go wrong holding on to silver. if it catches up to it's highs, like gold and platinum has, that's a big up!
WILDCARD: Silver is 67% below it's all time high in the '80's. So if it catches up to it's all time highs, like gold and platinum, that's a big-big up!
strategyupdate.com
Disclosure: AUY (gold mining, since the word "gold" was in the headline.)
ONLY THING I BROUGHT THE BAT-COMPUTER'S ATTENTION...with people expecting the rate cut -- and people scared of inflation --- and the move to gold and silver, more than ever in '08-- silver may extend the "up" trend longer than usual -- before it drops down. Bat-computer says the charts don't lie, and silver WILL be going back down to 15.36.
But the thing about computers, they don't factor in "emotions". We're seeing things we have never seen before, so why not a little bit longer of a long streak?
BUT, all of that stuff is for traders. as an investor, you can't go wrong holding on to silver. if it catches up to it's highs, like gold and platinum has, that's a big up!
WILDCARD: Silver is 67% below it's all time high in the '80's. So if it catches up to it's all time highs, like gold and platinum, that's a big-big up!
strategyupdate.com
Disclosure: AUY (gold mining, since the word "gold" was in the headline.)
INVESTOR ALERT: Is Gold About To Rise Substantially Ahead of Bernakie's Comments Today. WE SAY YES!
Although news wires just reported this morning that gold is going down, as investors take profits since gold just hit record highs near and above $890, gold just started to reverse the down trend, at least for this moment, and is rising slightly.
And with price of oil is down today to $93 and change, you would expect gold to sink along with it, not start rising against the oil trend?
Bernakie is going to speak in three hours from now, and Wall Street is expecting a sign as to whether they will give up a nice juicy rate cut they are crying for. And although a rate cut would actually weaken the dollar, and add to inflation...perception is reality, and I think Wall Street is betting that Bernakie WILL INDEED indicate an upcoming rate cut, which would weaken the dollar and cause gold to go up:
Oil is down, yet gold is rising as I type this -- just ahead of Bernakie's speech -- when news wires just reported gold was down on a sell off -- and the trend immediately reversed ???
Either it was the world's shortest sell-off...or Wall Street is increasing their position in gold, betting on a weaker dollar and higher inflation with further rate cuts.
So if you see this in time...you may want to act on the info.
Personally, I would wait and see if Strategy Update called this, just in time...or if it's just a blip.
strategyupdate.com
Disclosure: AUY
And with price of oil is down today to $93 and change, you would expect gold to sink along with it, not start rising against the oil trend?
Bernakie is going to speak in three hours from now, and Wall Street is expecting a sign as to whether they will give up a nice juicy rate cut they are crying for. And although a rate cut would actually weaken the dollar, and add to inflation...perception is reality, and I think Wall Street is betting that Bernakie WILL INDEED indicate an upcoming rate cut, which would weaken the dollar and cause gold to go up:
Oil is down, yet gold is rising as I type this -- just ahead of Bernakie's speech -- when news wires just reported gold was down on a sell off -- and the trend immediately reversed ???
Either it was the world's shortest sell-off...or Wall Street is increasing their position in gold, betting on a weaker dollar and higher inflation with further rate cuts.
So if you see this in time...you may want to act on the info.
Personally, I would wait and see if Strategy Update called this, just in time...or if it's just a blip.
strategyupdate.com
Disclosure: AUY
Wednesday, January 9, 2008
01/09/08 Stock Market Music Video of the Day: KISS - "All Hell's Breaking Loose"
Just because the Dow Jones was down another 239 points on Tuesday, after the biggest down week since the Great Depression, doesn't mean it can't get worse. Gold at a record high! It appears as though world investors are frantically pulling money from the markets and putting it in gold as an inflation bet. And, sources tell Strategy Update that the major financial institutions are investing in oil, so expect the price to remain high as speculators keep the price up, including concerns that rebels in Nigeria may attack African oil supplies. (Reuters says the attacks may happen in days. Obviously, the army is trying to prevent this.)
Expect gold to say at record (and new record) highs today. Gold mining stocks may add to yesterday's soaring shares. Some feel we have hit the resistance point, and although you may see some profit taking...gold should EASILY blow past $900 in early '08, without a sweat. And if it hits $1000...MAN IS THE ECONOMY SCREWED!
Read the threads below on this blog for further explanation as to why KISS - "All Hell's Breaking Loose" is the Strategy Update music video of the day.
strategyupdate.com
AFTERMATH UPDATE: What happened to the stock market on Friday 01/11? (Close enough timing?) This update posted 01/12/08
Disclosure: AUY, MOS
Expect gold to say at record (and new record) highs today. Gold mining stocks may add to yesterday's soaring shares. Some feel we have hit the resistance point, and although you may see some profit taking...gold should EASILY blow past $900 in early '08, without a sweat. And if it hits $1000...MAN IS THE ECONOMY SCREWED!
Read the threads below on this blog for further explanation as to why KISS - "All Hell's Breaking Loose" is the Strategy Update music video of the day.
strategyupdate.com
AFTERMATH UPDATE: What happened to the stock market on Friday 01/11? (Close enough timing?) This update posted 01/12/08
Disclosure: AUY, MOS
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Zuma Dogg said:
How's the market going to do this morning on the bell?
(Price is Right Sounder): Whomp, whomp, whomp, whomp...(deflated) whoooooomp.)
Oh my goodness...the Fed can't step in with another .75 cut today -- cause that's what it's gonna take to keep the market from dropping 3% on the bell.
Apple may end up at $129 today.
OH MAN...WHEN ARE YOU OVERLY OPTIMISTIC BOTTOM PICKERS EVER GONNA LEARN:
When Zuma Hutton speaks...that's what happens!