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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Vosilla who wrote (83228)	6/30/2007 6:30:03 PM
From: orkrious	Respond to of 110194

# @CoT report -- trotsky, 15:57:38 06/29/07 Fri that looks pretty good again too. about 30K contracts swing, options and futures combined. # @markets -- trotsky, 15:12:34 06/29/07 Fri safe haven buying in treasuries has apparently begun today - it all smells a bit '98-ty. # @pm sentiment -- trotsky, 13:23:00 06/29/07 Fri yesterday we had a hugely bullish jump in XAU p/c open interest to a fresh 7-year high at 1.68. this would indicate that the recently tagged supports will continue to hold. @stock market -- trotsky, 12:37:00 06/29/07 Fri financial stocks are under pressure again, and these days this is ironically exerting pressure on gold stocks as well. this is utterly perverse, and that's putting it mildly. the very things that are bad for financials (e.g. rising credit spreads, trouble with their mortgage assets and so forth) are actually bullish for gold. the fact that the market doesn't agree with this assessment shows that we still have too many fellow-travelers in this sector that have bought into it for the wrong reasons (those range from 'commodities have been going up' to 'jewellery demand has remained solid' to 'central banks are selling less gold' to 'mine supply is falling' to 'Chinese retail demand is rising'). all of these purported reasons to buy gold have little to nothing to do with where the gold price is going (as i've tried to demonstrate in my first gold article at Mish's blog). this is all drop-in-the bucket stuff. on the LBMA, 800-900 tons of gold change hands EVERY SINGLE DAY. does anyone think it matters if mine supply declines by 50-100 tons in an ENTIRE YEAR? or that it matters whether central bank X sells a 100 tons over 3 weeks? in reality, all of these fundamentals that mainstream gold analysts spend a lot of time dissecting and writing about are completely irrelevant. the true gold price driver, namely actual investment demand (as opposed to the ridiculous 'implied' investment demand figure released by the WGC) , is not measurable, and thus it's ignored by all and sundry. it just so happens though that every other datum pales by comparison in terms of importance. ignoring it isn't going to help any gold forecast. this is btw. a general failing of modern economics - if something can't be counted, they ignore it, regardless of its importance. this is why it is so widely held that Keynesian economics works, because it doesn't consider anything that is unseen. # @Sinclair -- trotsky, 11:43:48 06/29/07 Fri it makes no sense (not to me anyway): "Any gold purchased between here and the bottom if you assume that has not already occurred will turn out being profitable. Remember though, no margin!" either he is right or he isn't. if he's right and it's bottoming, you should actually use margin to enhance your returns. if he's wrong, you shouldn't buy at all. # AU_NB@Prechter -- trotsky, 11:41:00 06/29/07 Fri i know what Prechter wrote about gold. my point was that ever since the rally actually began, he has proven completely incapable of ditching his bearish stance. all that he said about surpassing the 1987 high, it's out of the window nowadays. in spite of the fact that he REPEATED it after his second 'goal post', namely the 1996 high, fell. # frustrated@PCE, CPI, etc. -- trotsky, 11:36:06 06/29/07 Fri all the official measures of 'inflation' (or 'aggregate prices') are lagging indicators. if the Fed were to focus on that (and normally, it doesn't), it would be forced to hike rates just as a recession got underway and rates on the market actually fall. # Bizarro @ UK middle class -- trotsky, 11:32:55 06/29/07 Fri this article - promoting the use of the middle class as useful idiots for the radical left based on envy - is a typical harbinger of the developing bear market mood. the rich are loved and often achieve stardom (see Trump, Hilton, et al) during secular bull markets. in secular bear periods, they become the focus of society's ire. envy and the urge for recrimination then bring on stuff like 90% income tax rates. when politicians hop aboard the bandwagon and begin to legislate against the rich (T. Roosevelt called them 'either criminally or foolish rich' - wealth is equated with being a crime when the bearish social mood strikes), they help to deepen and lengthen the bear market and depression. in this manner the collective psychological herding impulse creates the bearish realities on the ground. # frustrated@Prechter -- trotsky, 11:23:29 06/29/07 Fri yes, it was Prechter who predicted $200 gold way back when. at the time, the prediction wasn't unreasonable, since that was the high of wave 3 in the 1970's rally, so it was a natural price magnet. however, he should have seen the low coming when the BoE announced its gold auctions. major gold bull markets are always kicked off by the BoE selling half of its (remaining) gold right at the low. eschewing fundamentals has served Mr. Prechter exceedingly well during the 1980-2000 gold bear market though. the fundamentals looked bullish all the way down after all (money supply growth, budget deficits and price inflation all were raging/exploding throughout the period, and gold went down anyway).

To: John Vosilla who wrote (83228)	6/30/2007 9:45:44 PM
From: Tommaso	Respond to of 110194

It's true that there has been no yo yo like our current yo yo as president--maybe never

To: John Vosilla who wrote (83228)	7/1/2007 10:55:14 AM
From: Oblomov	Respond to of 110194

I'm not convinced that this is the "Bush economy" as much as it is an economic regime that started under Wilson, grew under FDR, exploded in size under Nixon and which continued unabated through Carter, Reagan, Bush I, Clinton, and now Bush II. I think of it as the "Mount Flatten economy" (remember the mountain in Bullwinkle & Rocky that contained large deposits of the element Upsidaisium, floating above the ground by a mile or so?), because it is tied to nothing tangible- by design our monetary authorities are free to print money as they wish. It's the American form of the corporate state, what got called National Socialism in Germany, Fascism in Italy, National Planning in the UK. It isn't called any of those things here, it gets called "public-private partnership" or "third way" if it is named at all. We are encouraged to believe that the US never fell for the economic nostrums that Europe did during the Depression, and that our economy is still capitalist. But in a sense, the US has never normalized back from the wartime footing we entered during WW I. The true contours of the system manifest at times. Why, for example, has the US policy in Iraq not changed despite a Democratic sweep of Congress last November (in fact, the US policy has not changed in 10 years), when the vast majority of Democratic rank and file are against further involvement in Iraq of any sort? Why did the immigration bill nearly pass in the Senate with little debate, when it was opposed by 85%+ of Americans, Democrat and Republican alike? This thesis has been articulated well by the historian John Lukacs: amazon.com >>You are comparing today to the 1960's? My gosh my grandfather couldn't get a mortgage without 50% down back then. My point was that there was a big bubble in the 1960s in stocks, but it was not because of "lax lending standards". >>I'll take divided gov't anyday. I'd prefer constitutional government, but since that is a lost cause, I agree with you 100%.

To: John Vosilla who wrote (83228)	7/1/2007 2:53:37 PM
From: pogohere	Read Replies (2) \| Respond to of 110194

I'll take divided gov't anyday. Divided between whom? Private ownership of the money franchise is the source of much evil. It happened in Greece, Rome, Holland, England and now the US. In each instance a republic or the equivalent thereof was lost. The libertarians and other free marketeers can howl all they like--that won't change the historic record. Money is a sovereign asset that belongs to the people. When it it captured by private interests, as it has been in the US since 1913, we lose our freedom. Jefferson predicted this would happen early on in the history of this republic. Mainstream politics is a form of kabuki intended to mask the collusion of the military, industrial and congressional complex.