dieuwer

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+4 / -1

195 Comments

    • Thu Jun 12th 19:43 PM | Rating: 0 0
      Commented on:
      Nasdaq vs. Homebuilders vs. Oil
      Let's put this in a somewhat longer perspective.

      In 1982, after a decade long run from a low of about $4, the price of oil peaked at about $40. A 10-fold increase. At the peak, the DOW/OIL ratio was at 25.
      Today, oil is at about $140 coming from a low of about $10 during the late 90's, a 14-fold increase, while the DOW is at about 12100. This gives a current DOW/OIL ratio of about 86.
      Although the gains of oil in the 21st century so far are much larger than during the 70's, the DOW/GOLD ratio is actually higher now, implying CHEAP OIL compared to the DOW.

      Conclusions: 1) The much larger rise in the price of oil in the 21st is for a large part due to hyperinflation. 2) The DOW/OIL ratio eventually will drop to the mid 20's, implying a much higher oil price. Even with a DOW crash to say 8000, it implies an oil price of at least $300.
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    • Sat May 31st 22:05 PM | Rating: 0 0
      Commented on:
      U.S. Market Setting Up for a 2nd Half Rally
      I remember back in '99 that I could apply for an IT job, be invited in a show room to pick my BMW and asked how many vacation days I wanted if I PLEASE accepted the job. The NASDAQ crash soon after.
      I remember back in 2005 talking to my collegues. They were all of the opinion that hous prices could only go up. "Buy now", "you don't need much money", "just get a loan." Two years later, the housing market started crashing.
      But what do I hear now when talking commodities? "Bubble, bubble, bubble." No stories from ordinary people telling me that "gold is only to go up," or "oil is only to go up, get a loan and buy gold".
      I think the commodities bull market has a long way to go. But when, in the far future, I will hear my neighbor talk to me about his hot commodities investment because "it always will go up", THEN I will sell.
      View article »
    • Fri May 30th 13:01 PM | Rating: 0 0
      Commented on:
      Compared with Canada, U.S. Economy Looks OK
      I agree w/ user 143167. The Canadians have not mastered the trade of hedonistically adjusting GDP numbers yet. They will learn ;)
      View article »
    • Wed May 21st 08:19 AM | Rating: 0 0
      Commented on:
      Choosing Between Wall Street and Main
      The yield on Treasury debt instruments has ZERO correlation with the actual rate of inflation.

      Example: FED prints money and hyperinflates the money supply. Next, FED buys treasuries by the boatload. As a result, yields come down.
      Conclusion: money printing leads to hyperinflation, but is not reflected in the yields of treasuries.

      To prove this, plot the ratio of gold divided by the price of 30 - Year treasuries, i.e. $GOLD/$USB. It is going UP, i.e. INFLATION.
      View article »
    • Fri May 16th 07:57 AM | Rating: 0 0
      Commented on:
      Farm Bill Stands to Overhaul Retail Forex Industry
      Retail FX brokers could just move their assests offshore and start trading via London or Dubai. Buh-bye CFTC!
      View article »
    • Fri May 16th 07:52 AM | Rating: 0 0
      Commented on:
      Crude Oil: Congress Acts, Iran Hoards, RTX Soars
      Suppose that in the case outlined above margin requirements on crude oil contracts rise very high, perhaps to 100%.
      Why would any trader or commercial keep trading via a US exchange? Might as well move the capital out of the country in invest via London or Dubai where lower margin requirements are set.

      This will just lead to an even larger loss of economic dominance.
      View article »
    • Thu May 15th 21:47 PM | Rating: 0 0
      Commented on:
      Hard Assets Heresy: Talking Down Gold
      daniela, if you are so concerned about "factual arguments" why don't YOU start using them instead of attacking the legitimate comments...
      View article »
    • Thu May 15th 13:06 PM | Rating: 0 0
      Commented on:
      Hard Assets Heresy: Talking Down Gold
      People such as Mr. Gartman are needed. They keep the gold bull market alive by providing scepticism and a "wall of worry".
      It would be far more dangerous if EVERYONE was bullish on gold and had acted accordingly.
      View article »
    • Wed May 14th 22:28 PM | Rating: 0 0
      Commented on:
      Japan's 'Lost Decade' Gives Way to the New Asian Reality
      There always have been longer periods of mediocre investment returns. The period 1900 - 1920 comes to mind, when the DJI traded between 50 and 100 up-down-up-down seemingly for ages. Or remember the period from 1930 until 1950? Investors who had bought near the top at 350 were still reeling from the 350 to 50 crush (1929 - 1932) and never fully recovered until the late '50s.
      I guess it will be a similar story with the Nikkei. The Japanese "Great Depression" and "hungry 40's" is almost over.
      View article »
    • Fri May 9th 14:52 PM | Rating: 0 0
      Commented on:
      What If We'd Been on the Gold Standard?
      The graph published in the paper by Bernanke and Jame shows NOMINAL growth of countries leaving the gold standard.
      If you would adjust the NOMINAL growth by the inflation resulting from the departure of the gold standard, you would end up with REAL growth CONTRACTION.
      View article »
    • Sun May 4th 19:59 PM | Rating: 0 0
      Commented on:
      Fading Glory: The Dollar as the World's Reserve Currency
      Interesting thought displayed in the artcle.
      Another explanation why China might have accumulated massive dollar reserves: to use as a weapon of mass destruction.
      Militarily, China may be no match to the US, but dumping TRILLIONS of dollars onto the market will have to effect of grounding the US military due to instant skyhigh prices of energy products.
      No wonder the US is frantically expanding the strategic reserve. They know that time will come that they no longer can afford to buy the stuf...
      View article »
    • Sun May 4th 16:03 PM | Rating: 0 0
      Commented on:
      The 'Death of Gold' Revisited
      Let's put this in a different perspective:

      From 1970 until 1978, gold rose about 4x, from $35 to $140.
      From 2000 unti 2008, gold rose about 4x, from $250 to $1000.

      Both span 8 years, both increase by 4x.

      Conclusion: I am not so sure we experienced the 1973-1975 yet, or will experiece it at all. I just think that the current bull is much less volatile that the one during the '70s AND that we already passed the "1977 point".
      View article »
    • Thu May 1st 17:43 PM | Rating: 0 0
      Commented on:
      The Commodities Bubble
      The only bubble out there is in the amount of DUMB financial commentators like L.M. and B.M.
      I bet SOROS is LONG commodities and tries to bully the weak hands out of the market so he can snap up some more, cheap commodities.
      View article »
    • Thu May 1st 17:39 PM | Rating: 0 0
      Commented on:
      Bespoke's Commodity Snapshot (5/1/08)
      Up.. + 0.75 to 391.20
      View article »
    • Wed Apr 30th 10:36 AM | Rating: 0 0
      Commented on:
      Translating Currencies through Gold
      The theory is flawed because it does not take into account transportation costs and tax law.
      View article »
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