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The Bullish Case for Silver

Supply/Demand Dynamic? The derivative traders are the new dynamic.

Oil zoomed to $150 a barrel and then down to $40 a barrel in a few months. Was there a supply shortage at $150? No

Did demand fall off the roof on the way to $40? No

The Bullish Case for Silver

"If you're a copper miner, you don't care about the price of silver. You just pass it off to your bank for them to sell at any price they like. That puts a lot of pressure on silver prices," explains Morgan.

Load of crap. The futures traders set the prices of everything and even the largest company's seem to have no control. Ever heard of Exxon saying, "Our price today is $75 a barrel?"

"The natural gold/silver ratio, or the amount of silver coming out of the ground relative to gold, is closer to 8 to 1," says Morgan.

I thought the prices of gold/silver were used to compute the ratio, not how many oz. are mined?

Exclusive: Big Banks' Recent Profitability Due to AIG Scam?

"But there is not some multi-million person homeless problem going on, at least to the extent there wasn't one before. Homelessness is not a lack of housing problem. And we have plenty of housing."

I think the administration should show compassion and give all defaulted homeowners a tent and allow them to live on their ex-property, but not go inside the house.

Exclusive: Big Banks' Recent Profitability Due to AIG Scam?

IsThisRight has it right. There is nothing sinister going on here, unless you are fed up generally by Wall Street traders and execs of all corporations stealing the country blind. Look what so called 'free' capitalism has created: A super rich elite class, the building of thousands of Palaces (called homes) which are empty and nobody can afford (you should see the communities Bobby Ginn developed in Florida that are now a big bust), while hard working millions are out of work and homeless. Free markets are a myth and always have been.

Let's give Obama a chance. It's the only time in my lifetime of over 60 years that I've seen an exceptionally intelligent man in the White House. He can't just hand out money to the poor. If he did that, everybody would be lined up at Burger King for lunch but nobody would be there to flip the burgers.

The banks have to be given the green light to lend money to creditworthy borrowers. Just giving them money didn't seem to do the trick. I guess if you gave them enough it would. But you need to make them feel secure enough to part with what they have. Remember, they are expected to leverage themselves 10 to 1, but if accounting rules put them under water, they lose their jobs and their company. How about relaxing the Mark to Market rules on performing loans so they don't have to MTM these at all. What I don't understand is how they MTM all their loans anyways. I thought they diced and sliced and bundled them up in pieces and sold them back and forth. How does anybody know what any of that is worth? I can understand nobody wants to pay the original issue price for it. So how do you evaluate it's worth? Maybe that's a lot of the problem?

Disappointing 'Tweak' for Mark-to-Market Rules?

If a bank lends you $100,000 for a mortgage on your house at 6% and if you are making payments on that house, why should the bank have to Mark to Market the value of that mortgage, just because there are no buyers who want to pay $100,000 for it? They are making their 6% and are happy to be making money. If you as an individual were a landlord holding that mortgage, how would you like the Feds to tell you sell your mortgage to some shark for $40,000?

Of course you weren't leveraged 10 to one like the banks, cause 'they' won't let you (unless you're a hedge fund... hey, let's leverage 100 to 1). But banks have traditionally been leveraging their deposits 10 to 1. Why? Because some rule maker long ago picked that #. Now that the MTM rules put some banks holding mortgages under water, why let the sharks get their mortgages for peanuts? It's a crisis. Just tweek the 10 to 1 leverage up for a while until the crisis passes. And don't MTM the loans that are not delinquent.

To figure that out, let's put those bonus babies at AIG to work doing something useful: Put all those bundles and pieces of mortgages back the way they were written. Then we can take a look and see whose paying their mortgage and for what.

China: Why It Can't Be a Global Leader

Interesting. I'd like to hear Jim Rogers comments on this..

The Closed-End Fund Discount Quandary

If a CEF is selling at $4 which a 20% discount to NAV of $5 and paying a 20% dividend of the NAV, and all of it is Return of Capital, then the discount is forced to shrink. In 5 years almost all of the NAV will have been paid out and the owner will have been paid out what he put in (the $4 market price) plus much of the $1 discount.

The Wells Fargo / Wachovia Story from 1994 to 2012

Fundamental analysis: How ...last year that all is. Get in fashion and watch CNBC. Listen at the talking heads all do their Technical analysis about support levels and trend lines. And for good reason: If most of the herd is traders and they are sheep to the technicians, then they are right; the market is not about how the company's are doing, it's about how the traders are trading.

I especially enjoy how they can't be content just to show their charts and talk their data. Every one can't help but make a prediction. Of course none of them want to be blamed when they are wrong, so they say something like this:
"You need to be very careful here. It may be time to nibble but you have to do your research and not get over exposed."

What does this translate to in common English? Ok here is the translation:

"Go ahead and invest in the market and remember if it goes up that I'm a genius and don't worry, I'll remind you next time I'm on TV. If it goes down, don't blame me because I warned you to be careful but you tripped and fell. Not my fault."

Cramer's Mad Money - Two Banks That Don't Need TARP Funds (1/28/09)

I often roll my eyes when I read the headlines of why the stock market is up or down for a given day or hour. But I realize the headline writers are required to write a headline, so they pick some event that's in the news.

Wednesday, there was a big rally and a 200 point gain in the Dow. Yet the headlines focused on the FOMC meeting which was rather late in the day. Even on CNBC when they mentioned the rally in bank stocks, there posted the graphs of 5 big banks/investment houses, but ignored the real reason for this rally: WELLS FARGO.

Wells Fargo posted earnings before the market opened. The headlines all pointed to a big reporting loss. If you read the details and know the story, you would see why Wall Street got so euphoric: Wells Fargo is doing fine. And the stock went up 30% + on the news. Why it dragged along all the loser banks I don't understand. But I don't understand why they dragged it down from about $27 to $14 when BOA was getting creamed a couple weeks ago.

When Wells bought Wachovia they took Tarp money and got a big concession on income taxes due to the merger. I guess the big worry was that they had underestimated the toxic assets of Wachovia. In the guidance along with yesterday's earnings, management basically said they are fine, the big loss is what we already told you to expect from Wachovia, we are not cutting the dividend that we just increased last quarter, and we won't be needing any more Tarp money.

In other words, Wells Fargo is head and shoulders above any other big banks in this country and always have been. Assuming unemployment is capped under 10% they will not be in trouble, and have expanded themselves to the East Coast in a big way and nearly instantly. They did raise money with a common stock offering last November to help fund the Wachovia purchase, which hurt the share price as the new common got priced at $27 which brought down the rest of us to that level from $35. It was bad timing as the markets got routed for 2 days just before the offering. They sold $11 Billion of stock for $27 to much more sophisticated buyers than me. I certainly don't have access to new stock offerings. So WFC buyers thought $27 was a steal on November 6. What's changed since then? Lot's of bad news from other banks. And business as usual from Wells Fargo. Yesterday it gained $5 on the earnings and governance news to $21. Why not all the way back to $27?

Yes, I'm long WFC

How We Can Avoid Another Tragic Ponzi Scheme

Consider that any capitalist society is a Ponzi Scheme. Think about what happens to a stock's price if the earnings simply stop expanding, let alone go flat or decline? Think about what happens to a scheme like Social Security when the population stops expanding.

Our system depends on increased everything, which is of course unsustainable. More people, more oil, more food, more water, etc.

I say go with the flow. Some big calamity will happen soon enough, and from the ashes, a new capitalist Ponzi scheme will be born with lots of room to expand once again.

Prefer a Yield - Cramer's Lightning Round (10/10/08)

This is similar to what is reported at LIFETIME FITNESS where the CEO put up a lot of his own common shares to get money to run the company. That doesn't sound like something one would do unless they had a huge stake in the company and the company was in financial trouble.

In Lifetime's case, they had also announced a sale and leaseback of 2 of their properties, raising 50 million. Unfortunately, the stock has tanked daily for 2 weeks, and whomever was holding the shares did a margin call and yesterday sold half a million of the shares, thus driving down the share price even more.

These 2 isolated incidences don't seek typical of corporate management. When the Feds 'inject liquidity' into a bank, what do you picture? A square building with money now in all the desk drawers? OK now what? Lend it to anybody? That's what got us in trouble. Lend it to Lifetime Fitness because they have a money making company and are still expanding?

So what's to make that bank lend out their new money? Chances are, the employees don't decide on their whims whether to lend or not. If they don't lend it's because they are restrained by the head honcho, who has just seen other CEO's get canned by the Feds when they were closed that bank. These bosses are simply preserving their own 'jobs' and ridiculous pay bonuses by holding on to all ther cash they can

Options Trader: Thursday Outlook - How Much More Disappointment Can We Stand?

Cramer is a bright guy, but has achieved God status in his own mind. Nobody has ever successfully achieved Guru status to the point they can call markets. Remember Cramer's declaration in July that the marker bottom had been reached? He has a big following because CNBC is the place for business news on US cable. Yet he didn't know all the bad news that was happening behind the scenes at Lehman Bros. and the banks, etc. So his followers who bought then got burned.

Now he's become a technician all of a sudden, and predicted we'll see 8000 on the Dow, as well as telling his sheep to sell. I think in this case he can be much more influential. The panic he's helping to perpetrate is based on nothing but technical analysis, and technical analysis has merit if enough people believe in it.

Did you ever watch one of the STREET.COM interviews on video where a young lady interviews Cramer? I've seen a lot of them. In every single case, Cramer interrupts her question before she is half through asking it and starts his dialog. That's the mark of someone whose full of himself. I did notice on the Today Show interview October 6, he was polite and patient while he made his gloom and doom predictions.

Like the rest of us, Cramer just doesn't have enough information to predict the future. He should stick to his Fundamental analysis which he's good at and quit playing God.