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The One Eyed Guide (http://www.oneeyedguide.com) is Bob Small who: solo traveled to 25 countries by age 21, has a degree in Economics, an MBA from Columbia University in Marketing and Finance, has been a brand manager, was a licensed stock and options broker during the 87 crash, ran a $450... More
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  • Is this the ultimate Gold sell indicator? Greenspan Declares Gold not a Bubble
    Alan Greenspan, the former Fed Chairman who failed to identify either the internet or housing bubble, has declared Gold is not a bubble.  This probably means the top is in on gold.
    Seriously, the top may be in for gold because the stock market is weak.  The Fed (or whoever you want to believe is managing liquidity) will crush gold because gold purchases drain liquidity from the economy.  If gold continues to go up pressure will be put on the CBE to raise margins so that stocks will be relatively more attractive - a higher stock market has all sort of positives for the economy.  The only benefit to higher gold is it makes the dollar appear weaker and gold at $1600 achieves this.
    Aug 25 9:21 AM | Link | Comment!
  • Unmerited optimism for the Empire State
    From Bloomberg/Econoday:
    The six-month outlook is in fact the most negative aspect of the August report. The six-month outlook for new orders, at plus 6.52, and for shipments, at plus 7.61, are the lowest since 9/11. The overall outlook reading at 8.70 is down nearly 25 points in the month for the lowest reading since early 2009.

    Hopefully the six-month readings will be only be temporary, tied specifically to the debt-ceiling drama and what is hopefully now faded market volatility. (My emphasis)
     
    Perhaps these indicate an emerging slowdown in the economy instead of an emotional reaction?

    Aug 15 9:12 AM | Link | Comment!
  • What will position limits mean to Commodity and Gold Prices?

    When the Commodity Futures Trading Commission (CFTC) finally passes position limits on speculation will Gold and other commodities shoot through the roof or dive to reflect underlying demand level?
    The correct answer is probably: Yes
    The Gold Antitrust Action Committee (OTCPK:GATA) claims that market manipulation by the bullion banks is depressing the price of gold and silver so limiting the positions in monetary metals should result in a price rise.  As most governments seem to be trying to devalue their currency it's difficult to figure out exactly how high gold could get. Some analyses indicate that gold won't get to bubble levels until it spikes above $2000 per ounce.  In a currency devaluation race where every nation competitively devalues their currency against every other nation gold could become a marker that keeps getting batted higher so $2000 may become the bottom.
    Other commodities such as copper seem to have a price well above that justified by demand and production costs so position limits would have the opposite effect on commodities if they are effective at reducing costs and speculative activity.  The drop in nonmonetary commodities could be 50% or more.
    Of course, the likelihood that regulations will be very forceful is low given past experience so commodities will probably act more like bubbles short term rather than well regulated, but boring, markets.  Over time even mild limits should result in a more rationale market but price changes could be abrupt as traders try to figure out how to protect their positions.
    We live in interesting times.
     



    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
    Jan 05 2:51 PM | Link | Comment!
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