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- The Always Precarious Dollar (and Its Impact on Gold) [view article]
- The World's Revenge [view article]
- Is Bernanke Hinting Something About the Fed's Rate Plans? [view article]
- Finding Your Comfort Zone with Currency Investing [view article]
- 3 Reasons For the Continuing Dollar Rally [view article]
- Global Market Performance: Nowhere to Hide [view article]
- 10 Signs of a Recession [view article]
- The U.S. Dollar: A Six Month Outlook [view article]
- Six Ways to Trade Foreign Currencies [view article]
- US Dollar Gets an Independence Day Boost from Europe [view article]
- Start of the Next Wave of Dollar Strength? [view article]
- The Deflation/Inflation/Stagnation Debate [view article]
loading ...Recent UUP Articles
- The Always Precarious Dollar (and Its Impact on Gold)
- Is Bernanke Hinting Something About the Fed's Rate Plans?
- Tuesday Outlook: Financials Under the Gun
- 3 Reasons For the Continuing Dollar Rally
- Q3 Currency Forecasts
- Finding Your Comfort Zone with Currency Investing
- The World's Revenge
- 10 Signs of a Recession
- Global Market Performance: Nowhere to Hide
- US Dollar Gets an Independence Day Boost from Europe
- Full List of Articles »
The Always Precarious Dollar (and Its Impact on Gold) [view article]
Many people seem to forget the real reason behind the dollar rally from 1.36 to 1.14 and back to 1.25 just in the calendar year 2005. That reason was the congress allowed U.S. corporations to repatriate foreign profits and pay only 15% corporate gains tax instead of 35%. If you look at those sharp 5% reversals the 1st weeks of 2005 & 2006 it seems that those movements had to do much more with the 'calendar' than any shift in fundamentals. And Warren Buffett misjudged this important factor and lost some 2bn on his euro long bet in 2005, so don't feel deflated if you seem to be sinking short term. ReplyThe World's Revenge [view article]
User142: counting my words?? why don't you actually do some *thinking* and write something worth reading.options: nice rant :) i don't know where to begin...but the campers next door invited me over for a beer...so...maybe i will get back to this. that said, i am heading out of internet range for a week or two. i am sure all the "Users" on here will be glad to hear that! Reply
The World's Revenge [view article]
Fitzman-- Get ready for a major rant:At this point, I don't think McCain is strong enough to carry the election. I don't mean to sound elitist, but I think that most Americans are really not aware that the mess we're in was the result of a deliberate and prolonged course of action orchestrated by Greenspan and then Bernanke, Congress, and, of course, the White House/ Treasury Dept.
( Who told the banks to start lending so that home ownership could be attained by any downtrodden deadbeat?) Americans are just looking for relief- relief from the gas pump and supermarket, relief from medical/insurance inflation, relief from falling home equity and shrinking jobs on the home front, relief from the war on the international level. They hear Obama's mantra for "change", and don't realize that "change" is all that will be left in their pockets. They want the government to "do" something. So, the Government is interceding in private business and nationalizing home lending ( thru Freddie and Fannie) wrecking the economy and causing our wealth to evaporate. Yes, that is "doing" something. In the meantime, the baby boomers are getting ready to collect social security. Any guess what that is going to look like in a few years? How about the rating agencies, talking about reducing the US government rating? I wonder what it will be like for investors when Brazil has a better debt rating than the mighty U.S.
Most Americans are unaware that oil/food is so expensive because the dollar is falling. Look how all those ethanol plants are failing. No surprise, of course. It's just unbelievable that our politicos can get behind a policy of turning food into energy, especially when it is so energy and water intensive. Although the time has not yet come, water will be as big a problem as energy is now .Look at GE, Veolia, Tetra Tech, Jacobs Engineering, Northwest Pipe, all water/infrastructure plays--maybe you can write an article about that. But, I digress.
I think if Obama gets into office, he can't go socialist in four years.The office always restricts the president, so how much damage can he inflict? As much as Jimmy Carter? I remember those days well, when Volcker was the most hated man in America. Now he is the holy man of sensible policy--almost a cult figure, in some circles.
And don't get me started on Nancy Pelosi. Let's send EVERYBODY some money. Hey, Nancy, how about getting your hands out of our pockets? How about de-linking health insurance to business and the government? How about allowing American business to innovate-isn't that what it does best? Why not allow them to turn their profits into R&D, rather than paying windfall taxes for all those people on the dole? How about allowing us to invest in our own retirements unimpeded, rather than have you raid the cookie jar called social security? How about going home to California to spread your sunshine there?
I also think (call me jaded) that the Republicans expect to lose this election so that Obama can become a one term president, and they can re-gain control of the White house. I realize that sounds crazy--maybe even paranoid.
I truly believe that McCain is the closest we can come to an old fashioned Democrat! He is the Hubert Humphrey of 2008. And how about Bob Barr?! I just remember him as a miserable, malicious malcontent during the Clinton impeachment hearings--thoroughly detestable. He's sure to take away a few of McCain's votes.
What a mess we are leaving our children and grandchildren. Check out Bloomberg--there was an interesting article today. Turns out that pension plans are now buying the re-packaged debt from the CDO/SIV debacle. You'd think they would learn from their mistakes-but not so long as the Fed and Treasury Department is there to bail them out with the dollars they are printing in the basement! Why don't they leave smart businessmen like Wilbur Ross to pick through that debt? How is it appropriate to put it into some poor working stiff's pension plan?
I don't know who I will vote for, and it probably doesn't matter. Either man is the wrong guy for the job. It's a case of "picking your poison."
And be careful with that Merk fund. The Euro and that basket of currencies is just as vulnerable as the US dollar. I think Merk opened up a yen fund. That may be a safe haven in the future. After all, Japan has had to contend with deflation for almost two decades. They are in a good position to profit, from here. Check out JOF. It's small cap. I still think the CanRoys are better than Merk Fund. Even with the foreign taxes, some are paying very handsomely, and monthly!
> User: you're all fluff - why don't you tell me *exactly* what i am
> wrong about instead of calling me a "liberal" and thinking you have
> actually said something. is it the US dollar drop i am wrong on?
> this is a fact that is easily verified. is it the deficits bush has
> run up that i am wrong on? this is also a fact easily verified. is
> it the performance of the S&P that i am wrong on? fact, easily verified.
> is it inflation? also a fact anyone with a brain knows, but unfortunately
> i cannot point to US gov statistics. so, User, *exactly* what is
> it that i am wrong about and what is so great about bush - please,
> tell me something of some substance. anyone can just throw stones...i
> did in kindergarten. grow up dude, be a man (or a woman?) and SAY
> something. wrt to iraqi oil, we WILL be pumping it out and would
> have been sooner if boy george had gone in with the number of troops
> his generals told him were needed. security has been the problem
> in case you are still on mars. that said, the oil contracts are going
> out to BP, XOM, TOT, CVX etc. etc and the US will soon be pumping
> what we went in for. thanks again for a real substantive comment
> (not).
>
> optionsgirl: i do have some SLV buried in the backyard and i agree
> with you that it appears to be more undervalued than gold when taking
> into account the historical ratio between the two. that said, i hafta
> say that i am kind shocked that oil and inflation are what they are
> and gold is under $1000/oz. wrt MERKX, i hold it as a substitute
> for cash not really an "investment" per se. it's up what 5 or 6 %
> so far this year, which is better than a money market for sure.
>
> btw, i take delivery of all precious metals - it makes no sense
> to have them in a bank vault or in london storage or whatever. if
> the #$%* really hits the fan and you need the gold to barter with,
> what good will it do ya in a bank vault? sorry you're having a bad
> day...i wonder sometimes where u work and what it is you do...don't
> expect you to answer on here...just curious is all.
>
> wrt politics, apparently you have come to the same conclusion i have
> about bush - only i used to live in austin and knew he was a moron
> from when he was govenor (he was instrumental in the legislation
> that let enron become, well, enron). wrt obama, the man can think..and
> he will absolutely destroy mccain in debates. unfortunately, mccain
> has gone back on everything that used to be mccain and is now simply
> a clone of boy george. the bad news (for me anyhow) is that obama
> just doesn't seem to get energy, which as you know if you have been
> reading my poop is what i believe is the greatest threat to the US
> economy, security, and equity markets. obama has been wishy washy
> on nuclear, said he wants windfall profits taxes (i wrote on SA why
> this is ridiculous), and doesn't seem to want to drill. anyhow, i
> am, like kurt vonnegut, a man without a country. i am ashamed at
> what has happened to the US, ashamed of our government, and ashamed
> at the people for letting it all happen. all that said, today was
> a good day on the river for me and i busted some golden brown trout
> :) who are you going to vote for? isn't mccain simply going to follow
> the (now proven) failed economic policies of georgie boy?? can we
> afford another 4 years of that? if so, the S&P will be under 1000
> again soon..it might be anyway!
>
> Reply
Is Bernanke Hinting Something About the Fed's Rate Plans? [view article]
"wake up and smell the numbers. Dow breaks 20000 on January 19, 2010."let's see...that's 18 months from now. from today's close that's an increase of 75%. i'm no market historian and i'm too lazy to look it up but i doubt there is an 18 month period in market history during which the dow jones increased by 75%.
other than faith, what do you base your forecast on? which sectors will lead this charge....
is it the financials that can't issue new loans because they lack the capital base and have been/will be forced to dilute the hell out of current owners because their stocks are at 10 year lows?
is it the energy and agricultural sectors that each show signs of topping out after multi-year historic runs?
is it the retail sector that is over-stored and just beginning to take a hatchet to their capital spending plans to conserve cash?
is it the industrial sector that is just starting to face the most significant economic slowdown since the dot com boom and who are being impacted as we speak by the inflationary surge in input costs?
is it the tech sector that sells to all of the handicapped above, whose stocks are still a fraction of what they were 8 years ago?
which sectors should we be long? i know that if there were an index linked to government bailouts of incompetent wall street banks i'd load up on it. it's the only sure thing i can think of in this market.
regarding the 90% of loans that are still performing...they don't matter. that's right....they're irrelevant. the ignorant/greedy/deceit... (pick your favorite term) greasy-haired leaders of those finanial institutions that got us in this pickle got us there because they were overleveraged.
quiz i bet you can pass:
question: when $1 of capital is supporting $30 of loans, what default rate is necessary to wipe out 100% of capital assuming every loan is recoverable at 50%?
answer: 6.66%
it's the few loans that go bad that always get an institution into trouble and it has happened because every one of these firms is overleveraged. and that's the reason they are loathe to take write downs...they have a thin capital base and even they understand that it's their capital base that permits them to lend.
second quiz:
question: who is more stupid than an (state your favorite nationality here) investor who provides a capital infusion to a big, illiquid financial institution that proceeds to lose half it's value in the 6 months following the capital infusion?
answer: a financial institution that pays a 10% dividend while selling stock at 10 year lows to raise more capital.
i always suspected that your average leader of a financial institution is either stupid, greedy or a well dressed crook. now i am certain of it. after this mess i'm certain of it.
Reply
Finding Your Comfort Zone with Currency Investing [view article]
Hi, Les,I am not aware of much research on currency ETFs. They are probably too new to attract much attention from analysts. However, even if they were I would be skeptical of their opinions. I'm equally skeptical of my own. No one can do much of a reliable prediction in this type of market, in my opinion. Things can turn on a dime at the slightest quiver of a wind from any direction.
I have read a book on trading currencies, and I thought it was fairly good. Remember, all we have are opinions, and currency trading (vs. investing) is not necessairly a teachable subject. The book I read is : Getting Started in Currency Trading by Michael Duane Archer. It is probably out of print, but I found a copy at Amazon. Also, there are a couple of authors who contribute to Seeking Alpha. Chen and Lieu (if my spelling is correct) are two you might check on.
I would encourage you to approach this subject with the greatest caution, and consider, instead, currency investing--something like the carry trade. Trading is fast paced and will eat you up fast if you are not exceptionally able to cope with it. Few are!
Good luck.
Ray0 Reply
again
Is Bernanke Hinting Something About the Fed's Rate Plans? [view article]
All this talk about the FED helping the markets here and there and propping the dollar and helping the banks etc etc etc.. Have we become the new Soviet Union? I guess free markets only applies when it comes for corporations to pay decent wages (above slave wages). Free markets no longer apply when the fat cats are getting hurt. hummm. Also how come there is no outsource of CEOs and CFOs and bankers jobs to say India or Vietnam where they are less expensive? Come to think of it how about the full congress outsource to low cost countries? ReplyThe World's Revenge [view article]
I counted the words in each phrase, sentence, and paragraph. In defense of Michael Fitzsimmons, this article is not “98% criticism-2% solution”: it’s 86.2% hypocritical liberal rhetoric (what EU member doesn’t have a twin deficit and out-of-control government spending?), 2.1% portfolio suggestions (the “buy” phrases), and 11.7% fluff. ReplyThe World's Revenge [view article]
User: you're all fluff - why don't you tell me *exactly* what i am wrong about instead of calling me a "liberal" and thinking you have actually said something. is it the US dollar drop i am wrong on? this is a fact that is easily verified. is it the deficits bush has run up that i am wrong on? this is also a fact easily verified. is it the performance of the S&P that i am wrong on? fact, easily verified. is it inflation? also a fact anyone with a brain knows, but unfortunately i cannot point to US gov statistics. so, User, *exactly* what is it that i am wrong about and what is so great about bush - please, tell me something of some substance. anyone can just throw stones...i did in kindergarten. grow up dude, be a man (or a woman?) and SAY something. wrt to iraqi oil, we WILL be pumping it out and would have been sooner if boy george had gone in with the number of troops his generals told him were needed. security has been the problem in case you are still on mars. that said, the oil contracts are going out to BP, XOM, TOT, CVX etc. etc and the US will soon be pumping what we went in for. thanks again for a real substantive comment (not).optionsgirl: i do have some SLV buried in the backyard and i agree with you that it appears to be more undervalued than gold when taking into account the historical ratio between the two. that said, i hafta say that i am kind shocked that oil and inflation are what they are and gold is under $1000/oz. wrt MERKX, i hold it as a substitute for cash not really an "investment" per se. it's up what 5 or 6 % so far this year, which is better than a money market for sure.
btw, i take delivery of all precious metals - it makes no sense to have them in a bank vault or in london storage or whatever. if the #$%* really hits the fan and you need the gold to barter with, what good will it do ya in a bank vault? sorry you're having a bad day...i wonder sometimes where u work and what it is you do...don't expect you to answer on here...just curious is all.
wrt politics, apparently you have come to the same conclusion i have about bush - only i used to live in austin and knew he was a moron from when he was govenor (he was instrumental in the legislation that let enron become, well, enron). wrt obama, the man can think..and he will absolutely destroy mccain in debates. unfortunately, mccain has gone back on everything that used to be mccain and is now simply a clone of boy george. the bad news (for me anyhow) is that obama just doesn't seem to get energy, which as you know if you have been reading my poop is what i believe is the greatest threat to the US economy, security, and equity markets. obama has been wishy washy on nuclear, said he wants windfall profits taxes (i wrote on SA why this is ridiculous), and doesn't seem to want to drill. anyhow, i am, like kurt vonnegut, a man without a country. i am ashamed at what has happened to the US, ashamed of our government, and ashamed at the people for letting it all happen. all that said, today was a good day on the river for me and i busted some golden brown trout :) who are you going to vote for? isn't mccain simply going to follow the (now proven) failed economic policies of georgie boy?? can we afford another 4 years of that? if so, the S&P will be under 1000 again soon..it might be anyway!
Reply
Is Bernanke Hinting Something About the Fed's Rate Plans? [view article]
So wait, Kathy is just figuring out now that the Fed is not going to raise interest rates anytime soon??Yikes. That is scary.
On top of everything else, the Fed cannot raise interest rates for a very important and secret reason.
The government, Fed, super wealthy americans, and investment banks don't want rates to start going higher yet, for that means the dollar would start to go up.
You see all those groups that I just mentioned have highly secret trading accounts that americans don't know about, that hold only commodities, that have done up tremendously in value over the past few years. Until those accounts are liquidated, the dollar has to be held down for as long as possible.
Don't think they exist? Think again. Reply
Is Bernanke Hinting Something About the Fed's Rate Plans? [view article]
To ETF nerd:At the end of your linked file we have:
This act re-creates the reserve balances that were extinguished on the front leg of the transaction.
You can find it in the one last paragraph, for me this implies that the EXACT value at the end is the same as in the front leg stuff.
In short: It is on banking books where mark to market does not take place very often.
Here is the link again:
www.newyorkfed.org/abo...
Reply
Is Bernanke Hinting Something About the Fed's Rate Plans? [view article]
To ETFnerd:I did read the file from your link, but it offers no proof whatsoever that pledged collateral is marked to market value on a daily basis.
If you have some proof I would like that!
All I see that there is some 'haircut' applied, but again the main problem with the primary dealer stuff is that the FED does not make the price for the collateral pledged.
Let me quote from your link:
The collateral pledged by dealers towards the repo has a “haircut” applied, which means they are valued at slightly less than market value. This haircut reflects the underlying risk of the collateral and protects the Fed against a change in its value. Haircuts are therefore specific to classes of collateral. For example, a U.S. Treasury bill might have one haircut rate, while an agency coupon might have a different haircut.
Comment: Haircuts are only a few percent while lots of that mortgage backed securities are just impossible to value because the origins cannot be traced. Therefore most of that MBS can at most be 70 cents on the dollar and in the future it will be worse...
Reply
Is Bernanke Hinting Something About the Fed's Rate Plans? [view article]
To ETF nerd:It might very well be that the third party prices the collateral and that it is marked to market value on a daily basis, but the fact that the FED does not put a price on the offered collateral is strange.
Thanks for the link, I have to admit that I still did not flea through the New York FED where a lot of this stuff takes place.
But given the sheer size of the programs, would some significant mark to market from pleged collateral not make the news?
I have never observed such news.
For the time being I do not buy it that the pleged collateral is really worth what it says, because if it truly had such a value you could sell it on the markets so why take the trouble and get treasuries instead? Isn't the official goal to 'provide liquidity'?
When the pleged collateral would truly be that value, exchange with treasuries would not bring more liquidity... Lots of MSB securities simply are not worth their AAA ratings, this is a fact well known.
_________________
To Kingofithaki:
Sorry I was not entirely correct, the mentioned 10 trillion is based on information I have from the Case Schiller index folks but this also includes some (but not all) commercial real estate.
I gave not the correct information, sorry about that.
But if you compare median family income to median housing value over the period 1996 to 2006 you arrive at the staggering conclusion that there could be over 50% of air in the top of the housing market.
And you say there are 11 trillion in house loans outstanding?
Well if you believe the Federal Reserve Z1 detail it is true, link:
www.federalreserve.gov...
It says: Mortgages at 10610.6 billion US$. (Or 11 trillion.)
It also says Federal debt standing at 5244.5 billion.....
Do you believe the total Federal debt is just 5 trillion?
And why not take a look at the total of debt the US financial sector has? It is 15945.7 billion US$ so that sector alone has over one gross domestic product of debt on herself.
This year alone the entire US economy will pick up so much new debt that this is about 20 to 25% of the gross domestic product; this new debt is needed to finance only 1% of GDP growth...
Not a country to invest in if you would ask me. Reply
Is Bernanke Hinting Something About the Fed's Rate Plans? [view article]
Lex Lux writes above:“..freely admit to very limited knowledge..”
Do not despaire - instead you have a full bag of the most precious commodity in the world: Common sense!
My mother tongue is not English but listening to Uncle Ben, his speech appears to me thinly veiled panic speak. Burning the deck chairs on the Titanic. To keep warm pending the sinking of the ship.
I never thought I utter these words but why not cutting this agony short and nationalize Wall Street? The American and other people around the world would be grateful. They will have to pay the bill anyway. And government bureaucrats can hardly do worse. And they would be far less expensive. De facto they are in charge now already. One can reprivatize later but in the meantime, this would be a formidable opportunity to do away with arsenals full of weapons of financial mass destruction in control of private armies of mercenaries, posing as “investment bankers”.
Have a good day
Reply
The World's Revenge [view article]
ps- no debating bush is a moron, and I admit voting for him, but do you think obama is the cure? ReplyThe World's Revenge [view article]
fitzman, buy silver too. It is actually more rare than gold- less reserves, and it is used up in industrial applications. If gold runs up over a thousand, expect silver to run up too- perhaps as high as $40. an ounce. Check out golddealer.comThey sell precious metals. Better than an etf-hold it yourself, then sell when you are ready. The pampe suisse 10 oz ingots are very pretty...
I like Axel Merck, but don't you think those fees really eat into your investment? I get his newsletter. Used to hold the mutual fund, but realized I could do better. You can too. The only thing about physical gold is you can't easily put it into a retirement account-because you are not permitted to hold it yourself. So, if you are investing funds in a 401K (as an example) it makes sense to buy gld and slv and even merckx. ( Is that right, or is it merkx--don't recall). At any rate, I am not going to debate your politics today. I am long oil, nat gas, gold, soy complex, and I'm having a bad day... You have a good one! Think about slv and holding physical commodities. Reply