drbubb

I dont think he was talking about gold shares - other commodities maybe. Anyway, until 2007, the Juniors provioded better gearing, and I think they may again

$996 and rising

YES! I have been thinking that Gold might hit $1,000, when the dollar falls thru Yen 100

I also like: "Maria, what's wrong with a recession? Recessions are healthy, they clean out dead wood." (or something like that) The Fed cannot "fix" the credit mess. It's about insolvency (ie values are unsustainable), not about liquidity. Lower prices are needed to fix the overvaluation. The pain must be endured, not delayed. The sooner real estate prices fall to a level where they are affordable to the masses, at sustainable interest rates, with reasoanble deposits from buyers, the better. That's when the problems will begin to ease.

This interview (click on link) with JIM ROGERS is well worth a listen: http://www.cnbc.com/id/23588079 Jim tells it like it is

A move up in Gold through $1,000 may get the Juniors (CDNX) moving. Here's how I track the Juniors, as a Ratio... Close-up: Daily CDNX-to-SPX ratio

RGLD is lagging, and that's disappointing, but I am holding on. In fact, here's my trading plan: I scooped up some long dared $25 call when it was below $30, as it approaches $32 again (if it does!), I will sell down some of my stock, getting my cash and profit out. Then I will RIDE the stock with limited risk, relying on my Call options only, while having access to substantial cash. This is example of the type of "arbitrage" trade that I often do: replacing one stock with another: buying better value or lower risk, while disposing of shares at a profit.

Agreed. A jump thru $1,000 could come at any time now

Thanks for that. I'm a fulltime investor, so my "job" is researching the markets, a seeking an edge

Only 25. just joking none, actually. But that doesnt mean that I am encouraging such letters. The friction here is slight. I think my posting reputation on HPC and GHPC tends to frighten off, some of the more extreme trolls. And perhaps they see GEI as too specialised to even bother.

Not necessarily. It was closer to the MA in previous episodes. Perhaps it will just drop to support (at a shorter MA, like 21d or 34d) before taking off again.

Even I, who was a moderator on two sections of HPC until recently, found the moderation policies, and reactions of the Mods extreme at times. Since that experience, I have posted alot less. But the HPC record still shows... #1: Realistbear Joined: 4-January 05 Posts: 17,225 Views: 722 #2: DrBubb Joined: 13-August 04 Posts: 10,464 Views: 594 #3: zzg113 Joined: 18-August 04 Posts: 9,042 Views: 29 #4: Charlie The Tram... Joined: 28-August 04 Posts: 8,484 Views: 1,242 (There are 8 more posters over 6,000, so I expect to be knocked off #2 withing 2008) When I had my little drama (following a spat about a moved Ron Paul poll), I found it strange that the Mods didnt show a little more respect for such a proliferic poster. And I decided if I was feeling that way, maybe some of the complaints were justified. I also thought that maybe I was posting too often- so I cut back. Old #1 poster, zzg113, cut back altogether, and disappeared, as far as I know. Does anyone know what happened to him??

27 solicitors letters? That does sound like a bit of a problem to me

EXCERPTS "The market was starting to question the solvency of bodies that stand at the top of the credit pile. These agencies together wrap or insure $6 trillion of mortgages. They cannot be allowed to fail because it would cause a financial disaster. The fact that this sector has blown up has caught everybody's attention in Washington," he said. The Fed action set off a powerful relief rally, lifting the Dow Jones index over 340 points in early trading. Both US and European equities have been hovering on key support lines in recent days, threatening to break down through 18-month lows in a second, brutal leg to the bear market. . . . It is a ground-breaking move for the Fed to accept mortgage collateral, even if the debt is theoretically 'AAA-grade' debt. The Fed is not allowed to buy mortgage bonds outright, but it can achieve a similar effect by letting banks roll over collateral indefinitely. The European Central Bank is already doing this, shielding Dutch, Spanish, German, and some British banks from the full impact of the credit crunch. The Fed is to create a new facility that allows banks to swap their mortgage bonds for US Treasuries. It is a well-targeted "sterilized" move to avoid adding fuel to inflationary fire. It follows the Fed's separate pledge last Friday to add up to $200bn in liquidity. = = RUSS WINTER's Take on this development: / note: FC="Fictious Capital"* This morning the Fed threw in an expanded version of their prior lending program. It now seems that the window is now wide open for banks and dealers to borrow against more of their mortgage securities, and lots of them. This is not the same as the Fed directly monetizing however. The collateral securities are loosely defined as AAA, a universe that is steadily decreasing. Again, assuming that these institutions wish to borrow, what exactly will they do with the new credit? Because the real or actual market in asset backed securities has been trashed, in theory there may be an opportunity for institutions to play the spreads, borrow cheap with Treasury swaps (borrowing Treasuries), to lend more dear. However, this will only work if the securities purchased are not fictitiously priced. Perhaps at this stage some are, but to me that price clearing of old FC is still a work in progress. If anything, these interventions cloud and distort that and add even more uncertainty to proper securities pricing. More likely, the response to this will be to take securities, borrow against them, and sneak it into the crack up boom pipeline that the Fed seems so oblivious about. As this news is fast breaking, and the market response reactive, I will have more comments later. /more: http://wallstreetexaminer.com/blogs/winter/?p=1476#more-1476 = = *WHAT IS "Fictitious Capital"? Money that is created (temporarily) by financing unsustainable asset values pumped up to artificial levels by "animal enthusiasms" and a credit bubble. Fictitious Capital can be transformed into real capital by selling the inflated asset, but that simply passes the inflation valuation on to the buyer. When the value slumps back, it will destroy the equity, and may also destroy value for lenders who have financed the inflated asset (my own adhoc definition)

Good summary. Yes, there are two counterparties to an OTC derivates trades, and when it gets sold on to another counterparty, not all the risk is extinguished. The counterparty credit risk remains, and so it "stays on the books" of both parties, although the core other risks in the trade may have been passed on. If you buy and resell a trade security, the risk is gone.

BIS valuation of world's derivatives back in 2002 was about $100 trillion * BIS 2007 valuation of the world's derivatives is now a whopping $516 trillion = = I think it is the worst sort of deception to pump out figures like that, without explaining something. These derivatives figures include loads of double, triple, and even ten-fold counting, because of the nature of Over-the-counter markets. To explain what I mean in a few words, those figures count footprints, as well as the positions that people are actually standing in. If you want a longer explanation, ask and if I have time, I will give one ... again

John Nadler, you can also hear him on: http://www.KEreport.com He usually offers useful comments, but I do not agree this time

Nice move UP in Gold and Stocks today. The yen must be weaker

That still leaves unfixed the problem of idiosyncratic moderation

(i thought I should post Marceau's comment here, with my response): Good insight: The crowd is now converted to the HPC way of thinking. You can see that in how traffic has shrunk to almost nothing on SP, and HPC has its noisy crowd. Let's keep GEI a haven for debate and contrarian thinking.

My target is 11,500. Let's see what VIX and volume look like when we get there

We used to call that: "Pin the news on the Market move." Sentiment moves the market, not news. When a market is ready to move, it will find news to give the traders an excuse to do the trade they are set to do. We saw the open gap down on Gold mostly filled, then they took it back down to retest the Lows. I reckon support near Gold-$960-something will hold, and Gold will be on its way up to the highs and beyond before the week is over. But no guarantee on that. Look at this ratio... I make it bullish for Juniors... "Back to Ice"? Before it runs higher? Let's hope so... RATIO: CDNX-to-SPX weekly daily

Yes. And it is beginning tio drag Gold back up

No worries. Gold gapped down on trading outside NY hours, and is now rising to fill that gap. Gold could have put in a useful LOW today on this action

"Back to Ice"? Before it runs higher? Let's hope so... RATIO: CDNX-to-SPX weekly daily