More musings from Him
Date: Wed Feb 25 2004 10:34
trotsky (silverrain, 9:05) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
well, that's something i've noticed as well - there's a broad bearish consensus , especially
w.r.t. the short to medium term, both in anecdotal terms and measurable sentiment indicators.
the Hulbert gold timers were actually net short recently, there are still more puts than calls
out in the XAU, gold sector short positions remain very high ( albeit below their ATH ) and even
the bulls sound astonishingly bearish almost to a man ( e.g. Maund, Ackerman, Paha, and a few
others ) .
to some extent we have the 'self-fulfilling prophecy' effect at work, as the followers of these
advisors either have been selling or aren't buying. otoh, gold oscillating in the 390-410 range
is no big deal imo, in fact it's probably healthy. btw., the early '79 triangle in gold around
the very same level looked almost exactly similar - and must have tried people's patience quite
a bit. when the triangle was finished it went up 200 bucks in 20 trading days. i'm not saying
the same thing's going to happen here, just noting that it has happened once, and is thus not
impossible.
Date: Wed Feb 25 2004 11:29
trotsky (frustrated, 10:38) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
"Federal Reserve Governor Susan Schmidt Bies said on Wednesday that at some point the official
federal funds rate will rise, and financial market participants need to prepare for that day."
i suggest the preparation plans should be timed for the mid to late 2010's in order to optimally
coincide with the 'at some point' date referred to by Ms. Bies.
Date: Wed Feb 25 2004 11:40
trotsky (cjk, 10:48) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
it is no surprise that the IMF bureaucracy would be in favor of Japanese helicopter money
exercises/John Law reenactments.
of course the damage wrought by these policies is by now incalculable...they may well have
cemented the foundations for the biggest financial/economic crash in history. since no-one will
make the connection at the time ( due to general confusion re. causes and effects in economic
mainstream thought, as well as the lag time involved in transmitting the damage ) , i take it
upon me to mention it now. it is erroneous to think that policy makers should 'fight deflation'
- in fact, the actions necessary to do so, all ensure that the eventual breakdown of the system
will be all the more painful and catastrophic.
Date: Wed Feb 25 2004 12:06
trotsky (Pendragon, 11:13) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
as every congressman well knows, if you but suggest that the aid package should be reviewed,
or tied to some sort of political progress in the Israeli/Palestinian conflict, you're losing
your next election bid - because Aipac and Jinsa are going to finance your opponent.
it's a brilliant scheme in terms of its simplicity , efficiency and impact...a typical
'kickback' scheme, only better organized than those usually are ( i.e. the circular flow of
funds is not directly traceable ) . the best thing about it is that the people actually paying
for it don't even know about it, and believe the ragheads hate them for their 'freedom'. it's
positively Orwellian, and you have to admire the chutzpa of it all. if Sharon cleaned out the
Gaza strip with nerve gas this afternoon, you'd be showered with editorials tomorrow explaining
how this was an absolutely necessary measured response proving what a reasonable peacemaker he
is, and congress would likely increase the aid package to help pay for the clean-up.
Date: Wed Feb 25 2004 12:19
trotsky (prometheus, 11:29) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
"However, though of considerable importance,
China's steel import needs, by themselves,
cannot explain the sudden jump in steel prices of 30 to 50%
in some categories, during the past two months. "
of course they can...China's demand explosion coupled with two decades of non-existent capital
investment in raw materials supply is all the explanation you need. recall that prices are
determined at the margin, and when a huge buyer that wasn't around earlier shows up all of a
sudden, you can attribute the marginal price driving demand to that buyer.
the fact that China has a credit bubble going on as well is a different matter - but i think
that's mainly aided and abetted by Japan at this point.
Date: Wed Feb 25 2004 12:38
trotsky (from an article posted earlier) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
click here ... thebulliondesk.com
"David Bloom, global economist at HSBC, said that in fact rising commodity prices were,
perversely, part of disinflation or falling prices. "The traditional idea of increased demand
leading to increased commodity prices and then goods prices and finally wage demand doesn't
hold," he said.
Commodities made up only a fifth of the cost for Chinese companies making finished goods, with
the bulk of the rest going on wage costs. "China has low unit labour costs so they are making
goods cheaply, the prices of finished goods is falling and this is encouraging more demand," he
said. "We are talking about a billion people in China making cheap goods."
this is of course a minority opinion - but it is correct. |
