Analyste de Boston

Investors Drink in Water ETFs

I had a client who was a water consultant. So, out of curiosity, I looked at (PHO) some time ago - not impressed then. I just think there are much more lucrative commodity-producer funds, and everyone should know this "water scarcity story" is very very old. It sounds like a huster's spiel, now.

Water's just not been a winner, and PHO is one of the oldest commodity-producer ETFs in the USA. At best, it's a riskier alternative to XLU. I haven't got time for lackluster investments that don't provide some measure of alpha, greater diversification or downside protection with a reasonable allocation, sorry.

$59 Billion Dubai Debt Default Could Have Much Wider Implications

The default risk is probably overstated, but WHICH US ETFs and MF have DubaiWorld/Nakheel exposure?

The Sheikh will have his rels cover the debt. Default means that DubaiWorld would otherwise have its global properties seized in various jurisdiction around the world. And Dubai's long history of imprisoning debtors will come back to haunt it... NO PRIVILEGES FOR RICH DEADBEATS!

Re: Madoff
According to the NYT 7/2/09 "federal prosecutors said that net cash losses in accounts opened since 1996 would total at least $13 billion." As of 11/24/09, Irving Picard (the Madoff Trustee) has estimated that total losses in the scheme at $21.2 billion.


On Nov 28 10:51 PM stockratease wrote:

> Bernie Madoff's largest Ponzi scheme the world has ever known accounted
> for about 50$ billion in losses...

Natural Gas: Powering the Dubai Overshoot

On Nov 28 07:23 PM DeepValueLover wrote:

> Dubai is a canary and the emerging sovereign bond market is the coal
> mine.

Dubai hasn't defaulted, let's be clear about that. But it's worth asking WHICH ETFs or FUNDS hold Dubai in their portfolio(s)?

No "DubaiWorld" in Powershares' Emerging Markets Sovereign Debt Portfolio (PCY) nor Templeton Emerging Markets Income Fund (TEI) nor the intl equity SPDR DJ International Real Estate (RWX):
tinyurl.com/y8o2evc
tinyurl.com/ybmwusw
tinyurl.com/yjuvvln

So who got burned?

Roger Wiegand: $2,960 Gold on the Horizon?

I'm glad everyone else is as irked by the "$2960" toss. However, I'm interested in this idea, and why not "what's a real & fair price for gold?"

Ambrose-Pritchard made the case for $6,900 oz.
( tinyurl.com/yjmc8lp ). Once upon a time, the issuance of paper Dollars WAS governed by ratios. There's precedent for ballpark numbers like $2,400., given Helicopter Ben's DOUBLING the monetary base (BASENS) this year. But that's not sufficient.

After all, people forecast the EUR/USD, CAD/USD, JPY/USD, AUD/USD : why wouldn't we want to know Au/USD, too ?

Yen, Gold and the Perfect Desert Storm

Buying any significant amount of bullion makes sense for OLDER investors, not so younger folks. Allocate 10-20% (a combination 'Commodity/Cash') and it's a loooong term hold, to get through years of dwindling SSI bennies.

For younger investors, paper PMs (ETFs) are just a portfolio hedge or speculative play: 5-10% allocation.

Is Dubai's Default a Black Swan Event?

Dubai? Isn't that the country where THEY THROW YOU IN JAIL IF YOU WELCH ON YOUR DEBTS? (How ironic.)

Yes, it is and they do:
tinyurl.com/yjovm5m

Despite Upward Trend, Still Only Buying Gold on the Dips

Cold, hard cash versus Obama Peachbacks? The choice is yours.

Gold is undervalued at $1,000. Or $900. Or $1,100. Or $1,200.

If you're willing to Dollar-cost average mutual funds, do the same with gold. Set a date to buy, or wait for a 2-3 day sell-off in stocks to allocate 3-5% to gold: have your cash ready, know the reputable dealer, exercise discipline w/ purchases. Don't dilly-dally, major investors are buying the dips too - and will continue to do so, as long as the Dollar suffers this abuse.

Buy bullion for the long term (10-15 years) - otherwise you can speculate with the PM ETFs in a tax-advantaged acct.

For an investor Aged 55-70, its prudent to build a 15-20% PM allocation over time. Harvest equity gains and buy bullion opportunistically; cycle paper profits into hard assets. There will be a Stimulus 2 - perhaps doubling the money supply again? - and I suppose that will eventually prove hyper-inflationary.

Look back to the Roman Empire and the debasement of the subsidiary coinage over hundreds of years. Meanwhile, gold held it's value - always more precious in periods of fiat currency inflation. Since 1910, the USD has lost 98% of its value against Gold, just 100 years. That's reality, not Coulda, Shoulda, Woulda...

The Must-Know Connection Between Stocks and the USD

Please note that the last time the USD lost 50% of its value (against the majors) in an orderly devaluation: after the Plaza Accord until the Louvre Accord. (9/15/85-2/22/87)

The US Stock Market ROSE ~58% while the EuroPacific (AEPGX) ROSE more ~68%.

When the Dollar gets trashed, investors are pushed out on the risk curve, the same thing is happening now.

How Will Dubai's Woes Affect ETFs?

Isn't Dubai the place where they THROW EXPATS IN JAIL when they cannot pay their debts?

Yes, it is. Why the double-standard?
tinyurl.com/yjovm5m
tinyurl.com/cjerp8

Gold and Silver - How High Will They Go?

USD$ lost -98% of its purchasing power in gold over the past 100 hundred years. In this same period, consumer retail food costs rose +2,835% (Statistical Abstr. 1910; USDA 2009.) Official CPI inflation is mysteriously (coincidentally?) the same.

Since 1910, here are the prices for the PMs:
Gold is UP +5,570%
Silver is UP +3,340%

From $ 40.8 in 1971, the real inflation-adj price at the end of 2008 would be ~ $ 565. (1,284% REAL inflation, estimating from John Williams' stats.) If gold in 2002 was fairly priced at $ 347. (and if not artificially low) 1oz. should be $ 607. (75% REAL inflation) today.

Gold looks expensive? Even though we haven't (yet) seen prices for goods & service soar, we know Helicopter Ben DOUBLED the monetary base in 2009. Conceptually, that's POG @ between $ 1,130. - $1,214. That's the "fair price" for 1 oz. of gold relative to the 2009 Bernanke Buck.

U.S. Government's Size: The Slow-Motion Crisis

With all due respect, Chris, your "Septic Systems/Title 5" is a regulation of the Commonwealth of Massachusetts. Not a Federal statute.

I'm a libertarian, but all those Commentators fulminating against the Feds and screeching about "States' Rights" (an old racist rallying cry) must face the reality that most noxious laws are local, not national.

And when some scumbag Republican like Mitt Romney "cuts State taxes" your municipality will make up the difference by jacking up locals fees & taxes. Let's be honest here, folks: that's how it works!

John Hussman: Risk Management and Convex Return Profiles

Dear GordonG,
Thanks for "doing our homework" and showing how wrong Hussman has been as a perma-bear for 15 years.

I emphatically agreed with his rationales (the ones I read, from 2002 on) on the fundamentals, but I DISAGREED on how to invest until the RE mkt began collapsing. Investors truly focused on fundamentals were punished until the Great Bear - they may be punished more, for awhile, for their prudence & discipline.

Sad to admit, but true!

On Nov 03 07:38 AM GordonG wrote:

> Deseret News, The (Salt Lake City, UT) - June 12, 1994
>
> NEWSLETTER SAYS STOCKS ARE A BEAR
-----

A Tale of Two Markets: Overvalued Stocks and the Declining Dollar

The Fed's & Treasury's E-Z money policies are designed for one, and only one purpose: to save Wall Street's *ss. They "bailed" out GS and the investors in a Reaganite version of Sprinkle Down Economics - and Main Street loses again.

Given the "doubling" of the monetary base announced early this year, it was a no-brainer that a new bubble would form first & fastest in the riskiest, most speculative (paper) investments. That's Wall Street's product to SELL, after all.

Starting from 1971, with REAL inflation and including the monetary base DOUBLING in 2009, Gold is still "cheap" @ UNDER USD$1,200. (in 2009 Dollars.)

Where to Get 50X Leverage on Stock Indices

Since this is the 'random thread of digressions,' has SA figured out how to BAN the spammer Cretin? Can't they just block his Turkish IP ?

Beyond GLD: Four Alternative Gold ETFs

This is a confusing typo:
"while almost all of GDXJ consists of large cap firms" should read
"while almost all of GDX consists of large cap firms"

I can think of one very good reason to invest in GDXJ and NOT GDX. It should be obvious to all.

If you invest in country funds like SA or Oz or other commodity producer/sector ETFs/MFs, you probably already have significant to the major miners!

OTOH, it's very unlikely diversified investors with 10-20 other ETF investments would have any appreciable exposure to the junior miners.

How risky is GDXJ, is the overriding question? I'd suppose that's an aggressive play, perhaps only suitable for long-term investors.

JUNIOR MINERS FOR DIVERSIFICATION, in LONG TERM PORTFOLIOS.