Friday Outlook: Commodities, Emerging Markets

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Historically higher interest rates cause investors to abandon commodity markets as the carry cost increases and this affected precious metals particularly Thursday.























































Okay, let’s see how they wrap things up for May today. Bulls have their paint brushes handy to keep everything in order to end the month on an up note.

Do a couple of days of price swings change the entire investment landscape themes? Do we sell everything related to commodities and buy banks and tech? And, has Uncle Buck finally hit bottom as well? One thing’s for sure, I don’t have the answers but the tape is talking to me and I’m listening.

It does disgust me how taxpayers through the Fed and Treasury are giving banks money with the “wink wink” purpose of making loans to lift the economy and resolve the credit crunch. But, I think they’re just trading it for their own accounts. You’ll know this when you inspect their next earnings reports and focus on “trading” profits. It should upset you. It upsets me. But that’s the market we have and acceptance is required.

Have a pleasant weekend.

Disclaimer: Among other issues the ETF Digest maintains long or short positions in TLT, TBT and GML.

Comments

[fatcat:]

Great,as always David..I'm getting addicted to this..Great way to get an overview,plus commentary helps me with the markets I don't follow!Great stuff,thanks.

2008 May 30 05:23 AM

[User 170687:]

You are exactly right re the trading. They are all doing it and it's basically the only thing keeping this market afloat. There's no way it works in the long term unless Bergabe ups the ante even further. If anything the Fed should be demanding a cut on the taxpayers behalf.

2008 May 30 07:59 AM

[stu:]

Awesome read. Thank you!

2008 May 30 08:22 AM

[Archman Inv...:]

As always very good analysis, coupled with some laughs.

For those of us who know how Wall Street really works, there is money to be made. The corporate sponsored criminals, Um.. I mean media, CNBC, et al, will continue to pump the market, collect their millions dollar paychecks, enjoy the best paid for health coverage, their free limo rides from CNBC headquarters and eat their china service meals, all at the expense of GE shareholders, while the rest of america pays for gas, cars, healthcare, etc. But hey, there has been and is not inflation, right?

The US stock market can now claim the true title of most manipulated and corrupt stock market in the free world..congrats!!

Thanks to our own Fed and gov't basically admitting, even lying under oath..LOL, that they buy cash futures and stocks directly thru their investment banks (who in actuality own the Fed) we truly are in a market that is not free anymore.

For short term speculating:
I use the US market as a trading vehicle to capitalize on short term directional movements.
For my long term buy and hold portfolio (yes i still believe it works):
I buy stocks outside the US that trade directly on exchanges in other countries.

The Us market is proving itself to be one big Ponzi scheme, with zero regulation, and no, "after the fact" regulation does not count.

2008 May 30 09:26 AM

[dukeb:]

I'll be the first with the GLD sword, then.

"I don't know why I said that frankly" is a completely lame self-analysis for a public technician regarding what appears to be outright disinformation in Wednesday's Outlook. (GLD: "We took a small long position today.") There's no useful information in that Crameresque confession, and unless I'm missing the joke somewhere, we deserve better. (Was it merely a tense-typo followed by change of mind, temporary insanity, or something else?)

2008 May 30 10:13 AM

[User 114901:]

Awsome!

2008 May 30 10:38 AM

[Emerald:]

Dukeb, you are correct. However, Fry admitted the error and we move on. Archman is also correct in that the talking heads spin info at us and then issue the Crameresque "non apology - apology". Caveat Emptor, always.

2008 May 30 10:58 AM

[mythoughts:]

Great read! Lots of insight.

2008 May 30 12:07 PM

[pchris:]

Dukeb, the reference to a Crameresque apology is a reach and undeserved, IMO. Habitual manipulation and misinformation ala Cramer is quite different from Mr. Fry's human error, which he admitted to. BTW, Mr. Fry's sage column is FREE! and stands head and shoulders above the maddening crowd of bloggers, talking pinheads and biased media folks. Go easy on the sword, my friend.

2008 May 30 01:08 PM

[Humblemaster:]

Sword or no sword, from an individual investor searching the net for some kind of guidance that's unbiased and very informed, I think Fry is truly the GLD standard!
Thanks, Mr Fry!

2008 May 30 02:44 PM

[cyberman:]

More thinking per inch on my monitor's screen than practically anywhere else.
Pure populist nosiness I suppose, but archman (no kin) sparked my curiosity. How do we find out how much Jim, Maria, Michelle, Neal, Erin etc. make and the value of all those perks archman refers to? Disclosure: Long GE (but regretting it.)

2008 May 31 03:11 AM

[David Fry:]

Well, thanks all for your comments. I take seriously my error and "did" while posting think we made that trade but later realized we didn't when getting to the "disclaimer". However, I just plain forgot to correct or change that chart. Maybe it's just old age. Nevertheless, my apologies.

2008 May 31 11:31 AM

[dukeb:]

For what it's worth, I'll buy that. Thanks for the clarification.

2008 May 31 01:54 PM