market ace's Comments

How Banks Fail at Foreclosure Auctions

Tue, 08 Dec 2009 14:50:11 -0500

We had the opposite experience 2 years ago truing to buy a property from Countrywide.. We made a lowball offer (all cash) and they countered wanting full appraisal, which turned out to be only $2,000 more than our offer so we agreed. Upon inspection there were minor things wrong with the property such as the garbage disposal did not work etc. At most a couple of thousand to fix them all.

We said that as long as they wanted full appraisal we wanted all itmes fixed as we did not want the hassle of fixing them. They refused so we walked. The property is still sitting vacant two years later, all of the landscaping is dead, real estate taxes have accumulated and who lnows how much additional work is needed to restore the property to a livable condition.

They now have the property listed for 25% less than we offered and still no takers. The insanity of lenders is amazing..

With Housing So Affordable, Time to Go Long Homebuilders

Tue, 24 Nov 2009 17:30:41 -0500

This seems to be a case of cherry picking one stat that becomes meaningless when faced with reality.

The gov't is still paying people to buy homes and even that program is dying now.

With the unemployment/underempl... rate at 20+% and rising the market is doomed for a long time.

With FNM, FRE and banks turning foreclosures (still running over 300,000 per month for 8 ,omths now) into rental properties back to the borrowers supply is far out pacing demand.

With an estimated 7 million shadow inventory homes now owned by lenders from actual or ultimate foreclosure available used homes are about to swallow any new home market.

With thousands of homes available at $500 and up (with no bidders) the market for new homes is dead for a long time.

Home builder stocks are not the place to be.

Face It: The FDIC Is Broke

Tue, 24 Nov 2009 17:15:59 -0500

It is a race against time to see which comes first the bank panic and runs on the banks or a long bank holiday while the gov't "sorts things out" (devalues the dollar). The FDIC may "guarantee" you will get your money back in a bank default, but does not say when or what it will be worth when they finally pay you. That is the scary part with this agency.

Safe deposit boxes are also a big risk and too many reports of boxes being raided and sold off (especially by B of A) and gov't agencies are surfacing all over. One report says that the Patriot Act specifically makes it illegal to store "items of wealth" in a safe deposit box (making them subjct to search and seizure) and only "personal papers of value" may be stored in them. I have not personally verified that, but it was c;ear;y reported that way.

Pan American Silver vs. the Silver ETF: Which Is the Better Investment?

Mon, 23 Nov 2009 16:44:52 -0500

Pan Am is all right, but the giant miners always seems to come up short on profits and the country risk is substantial.

However, compared to the risk that SLV does not hold the silver it claims and is probably a sham it looks terrible by comparison. Silver investors should be holding their own bullion or coins not paper silver.

I am very surprised that no one is crowing about SLW here as it is a near perfect silver play having purchased pre production silver at about $4/ounce and cashing in mightly as prices rise. Also SVM claims a silver production cost of about $.04/ounce operating in China. Of course both stocks have risen greatly already, but have a great long term outlook - IMHO.

5 Thoughts for Monday Markets

Mon, 23 Nov 2009 15:27:02 -0500

The home sales number may appear better, but the reality in residential and commercial real estate is still dire.

Foreclosures continue to exceed 300,000 per month and have for 8 straight months now, but most of these are hidden away as banks refuse to put them on the market. Both the banks and gov't agencies are also converting foreclosure properties into rental properties for the defaulting borrower to further hide the massive real estate problems and avoid showing the losses on their books

Fannie and Freddie continue to use ultra-low lending standards to "create" sales that are of course bolstered by the $8,000 tax credit, which is being used fraudulently (more than 19,000 claims were made before any home was even purchased etc.) and more than 30% of home owners are still under water.

The disaster in residential and commercial mortgages is going to get much worse before it gets better.

25 Reasons We Will Not Have a Depression

Sat, 21 Nov 2009 15:32:18 -0500

In addition to the disaster that is E*Trade (still using their false ads of a thousand new accounts per day) You should be worried about the entire equity sham.

I hope you all investors are aware that you do not own the equities you have paid for (unless you physically hold the certificate in your hands - not even allowed by many companies) and no where does your name appear on the companies records. You are totally at the mercy of The Depository Trust Company (DTC) and few people know they even exist, if they are solvent, will stay solvent, are honest and trustworthy, or worse yet if they have any record of you.

The DTC owns all bonds and stocks, not the investors. Rather than in your name, all equities are registered (as the legal Registered Owner or agent) in their "street name", Cede & Company.

The DTC is the Registered Owner - holder - of your stock or bond. The DTC is the legal property-holder, share-holder, stock-holder, owner and purchaser. Your name appears nowhere on the book entry or certificate as the actual owner. Instead, you have been designated by the legal registered owner, the DTC, as the Beneficial Owner. This means that your lawful Rights in that stock or bond are confined to that of a successor or heir. The difference between an owner and a beneficiary is like night and day. Take the time to absorb and understand the definitions:

In these troubled times fraught with fraud, gov't intervention and Wall Street crooks this should be worrisome to most investors.

On Nov 21 10:22 AM The Dark Years wrote:

> I have several E Trade accounts including Roths for my children and
> have been concerned for some time now about what happens to those
> accounts if E Trade fails. Each account carries long investments
> that are down twenty to eight percent. I have recovered in short
> term trading, perhaps half of what was lost since early 2008. So
> what to do now. Continue to play the short term trend and try to
> get back to parity before the fall. When to withdraw the cash and
> what to do with those dollars once in hand remains the question.
> Physical gold and silver seems a good bet, but what if it is a bubble?
> Where does one go for cover?
>
> Your insightful thoughts about the fragility of E Trade (and by extension
> TDAmeritrade and others) gives me much needed pause for sober reflection.
> When you stir into the mix governmental ineptitude, corruption, and
> the arrogance of leadership the mix thickens. Add the cost of two
> unnecessary occupations, and the full measure of the world wide economic
> crisis and you have a mess in the kitchen which will be almost impossible
> to clean up. Of course you can try adding a dash of peak oil price
> as a kicker and who knows where it will go? I know that I will be
> paying close attention to my E Trade, and other trading accounts
> based on your informative assessment. Thank you.

Housing Starts Plunge

Wed, 18 Nov 2009 14:44:55 -0500

Gee what a surprise. Why aren't all of those unemployed people and those that will still lose their jobs out house hunting with all of their free time? Surely the millions of people facing foreclosure should also be in the market for a nice new home.

Is it possible that even with a ridiculous gov't giveaway that eventually you run out of new home buyers - even if the definition of "first time": is badly abused?

Gee is it possible that Main Street America sees the economic disaster all around them that is only getting worse while Wall Street and Washington sitting in their ivory towers collecting multi-million dollar bonuses cannot see what is really happening to the country and keeping preaching about some recovery that is a myth at best..

10.2%

Fri, 06 Nov 2009 18:10:17 -0500

Maybe you should take time out from worshipping that tax cheat Treasury Secretary that answers to GS and not the American people. I'm afraid what you have yet to learn is that the US is now the world leader in fraud, debt and excess consuption for many years and there is a price to be paid for that and it will be paid eventually.

Agreed no one should be a perma bear, but obviously you are too young to remember the great depression and should spend some time researching what happened. Apparently you are drinking too much gov't and media kool-aid and are closing your eyes to the reality around you.

What disaster can befall a perma bear that avoids the markets and makes or looses nothing - as long as they have protected themelves against possible hyper-inflation which is the only growth you may be seeing in the future, while not realizing that your wealth and purchasing power are being destroyed while stock values go up and cause a real illusion to people like you.

I applaud you for saying you may be wrong, but as someone that has been involved in the economy and markets for over 50 years I can tell you that you have only a slim chance of being right.

On Nov 06 01:19 PM KingGeithner wrote:

> The perma-bears on here are as blinded as the perma-bulls were from
> 2002-2007. You are all too convinced by your own arguments to see
> that the US will not collapse, has avoided an economic holocaust,
> and likely will benefit the most (of all already developed nations)
> from rising emerging markets. The US is the global leader in pharma,
> tech, biotech, large multinational corps, and with a weakened dollar,
> these companies will only grab even greater market share in their
> industries.
>
> Now, unlike most of the posters on here, I am not completely firm
> in my opinions, and do allow for the chance that I will be wrong.
> There still is a chance that we can experience a double dip. However,
> I think the perma-bears, or any individual that fails to consider
> that they maya ctually be wrong, are setting themselves up for disaster
> themselves. Good luck perma-bears, but I think you will probably
> miss out over the next few years because most of you are completely
> inflexible with your opinions.

Roubini: Commodities Due for a Correction

Fri, 06 Nov 2009 17:38:18 -0500

Maybe Roubini got it right on the financial crisis, but now he is just taking advantage of that and shooting off his mouth without much real knowledge of what is happening or going to happen, like the typical econ professor that he is.

Apparently the world moves to fast for him to comprehend with statements like it will take decades to kill the dollar as the world's reserve currency when our gov't is pushing so hard to devalue it and the rest of the world is sick of our deficits amd QE and has the power to kill it whenever they choose.

Does he really think commodity position limits would stop speculation when all that will do is move trading to other foreign markets.

As usual he has no concept of gold as money and hangs his hat only on supply and demand.and even ignores the devaluation of the US dollar, the Chinese demand and the huge shorts held by US banks that need to be unwound.

Roubini has had his day and should now shut up and crawl back in his black hole

The Real Job Loss Story: Death of Small Business

Fri, 06 Nov 2009 11:43:51 -0500

Small business does not make giant payoffs (campaign contributions) or have lobbyists padding congress peoples pockets so the gov't does not think they need them, The power hungry socialist in Washington, which are married to Wall Street, are too high up in their glass towers to see or care about the foundation crumbling beneath them.

As usaul the Gov't thinks small business is struggling because they cannot get credit as they think debt is the answer to everything. Why would small business borrow to expand in a dieing econmy? Econmoic policies, tax laws and true healthcare reform (Not the Pelosi tax, regulate and screw business) model are desperately needed, but it will never happen with elitist clowns running the country.

Unemployment Claims: Watch the Distortions

Thu, 05 Nov 2009 12:36:44 -0500

Oh no I just hate it when the truth comes out and ruins the party. Well actually I guess it did not ruin the party as Wall Street drinks the phony Gov't kool-aide and ignores reality.

Wait until tomorrows phony jobs numbers come out and Wall Street eats that up too. Washington throwing a trillion dollars out there has managed to slow the decline, but even that amount can not create job growth as it is all being used for unsustainable programs.

Corporate Layoff Cycle Seems to Be Taking a Break

Wed, 04 Nov 2009 17:47:59 -0500

Wow what fantastic news here. I guess when you run out of employees to lay off job losses have to decline. Still 530,000 new unemployment claims per week though. There are absolutely no prospects for job creation in the US and the stimulus welfare bill did nothing to stimulate long term job creation so now congress is extending unemployment benefits as they know there will be no new jobs for a long time. Without income growth there is nothing that can possibly sustain a recovery.

I think you have confused a bull market with a BS market as the only growth going on is in the size of gov't, the increase in gov't debt and the increase in wasteful gov't spending.

Expect to See a Short-Term Gold Pullback

Wed, 04 Nov 2009 17:04:49 -0500

You guys that bury yourself in charts need to look up and view the world around you once in a while to see real trends. I read 5 articles on gold today by chartists and the short term predictions vary so much it is hard to believe they are writing about the same asset and using the same charts.

As stated by the previous comment, big US banks doing the govt's bidding to manipulate the price down are getting in serious trouble with their giant shorts. China and now India are setting a bottom price for gold and when the truth comes out about all of the missing gold supposedly held in US and UK vaults and the comex naked shorts gold has only one way to go.

It does not take a genius to now say in the short term there will be a correction as no price goes straight up. I guess traders try and guess these short term gyrations, but anyone investing in gold should be looking at the long term not just tomorrow's price.

Commodities: How to Trade Like Goldman Sachs

Tue, 03 Nov 2009 11:15:59 -0500

GS bearish on gold and silver - Ha Ha Ha.

Since they are very short on these metals as they carry out their gov't mandate to manipulate their prices they have gotten caught with their pants down on this one and are trying to again lie their way out of a big loss.

In typical fashion I am sure they are betting against their own predictions as that is the way they sucker investors into their web to show great trading profits..

Consumer Credit: Precipitous Drop in Credit Card Offers

Fri, 30 Oct 2009 15:23:17 -0400

CC mail offers are down because CC companies do not need new business as they have found better ways to make more money by screwing existing customers with absurd inrest rate increases, more and higher fees and increased payments.

GDP Euphoria: An Artificial High

Fri, 30 Oct 2009 13:41:14 -0400

The Gov't plastered a 3.5 percent GDP growth rate on the marquee yesterday, and traders acted as though the information had come from God himself. I always expect the stock market to wet its pants when these dog-and-pony shows turn up the wow factor with a laser light show. But did this market surge really indicate that any sane person truly believes that the economy is strengthening as opposed to the gov't just growing out of control on every front?.

The rally felt like it was about 99.99% short-squeeze, with Abbe Cohen’s plump, well flock making up the other 0.01%. But that still begs the question of why Mr. Market should have been so nice to us, providing a fabulous opportunity to unload stocks even though “everyone” knows that the bear rally begun on March 9 is over..Mr. Market is planning to drown all the believers on Friday by savaging bulls that just cannot seem to understand the reality of the economy and want to believe the BS coming from Washington.

Q3 Real GDP: Not All Details Are Bad

Fri, 30 Oct 2009 13:27:14 -0400

It is only fitting that on the 80th birthday of the great market crash of 1929 that the gov't now thinks they can feed us pure BS and hocus pocus stats to try and avoid a repeat of that fateful day and mask the terrible economic pain being felt on main street

About half the reported growth in GDP came from the expired Cash for Clunkers, government- subsidized, vehicle-purchase plan where they provided significant cash rebates in exchange for consumers buying the cars the Central Planners wanted folks to buy. Most of the rest of the GDP growth came from increased government expenditures, which were up 7.9 percent. This is a great number for socialists; however, for households, which account for 70 percent of GDP in a capitalist economy, not so great. Households remain stuck in an economic quagmire. Current economic policy appears to be more about the government and Wall Street than the average American household, and 3rd quarter GDP brings the point home in spades.

For the American Household, the deep recession (possible depression) remains firmly intact. Present and future cash needs remain a fearful proposition in the wake of rsing unemployment and lack of income from every investment source.

U.S. Economy Is Growing Again?

Fri, 30 Oct 2009 11:27:43 -0400

The only thing that is growing is the size of gov't, gov't bailouts and gov't debt. To equate that with economic growth as the public suffers and mires in depression is hardly reason to celebraete or be optimistic about and "recovery".

I Heart ETNs

Tue, 27 Oct 2009 18:23:21 -0400

ETN's are hardly worth the risk for most investors. Maybe you did not notice, but most of us do not hold 50,000 shares at a time and depending on noise to monitor these banks stability, since most are foreign, is not for me.

Too many also have very small volumes that make them undesirable to me. I do hold DGP, but it has alot of volume, but I also keep close stops on it.

Dollar Is Up - Against Only 9 Currencies This Year

Mon, 26 Oct 2009 18:24:41 -0400

Thanks to the great work of Geither and Bernanke and their strong dollar policies -LOL, we are not dead last and have beat out these stellar currencies.

Can't we also count a win against the Zimbabwe dollar that went defunct and get this total wins to 10?

Gold: How the Mainstream Gets It So Wrong

Sun, 25 Oct 2009 22:56:18 -0400

Nothing like using your own fuzzy math and a 109 year old strategy to preserve your wealth

US corporations today pay peanuts for dividends if anything and when you buy stocks in the US markets you depend on the greater fool theory of some sucker actually paying more than you did and this may not be the best way to protect and preserve your wealth that was probably earned through sound investing in the past.

Maybe you did not notice to what happened last Oct and again in Mar and will happen again soon. Stocks can become near worthless just like the US $

Maybe Coke is way up, but you forgot to mention how much GM, AIG, C, F, MSFT etc etc are up. You just keep holding your worthless pieces of paper paying some paltry dividend and I'll hold my gold, because the world changed radically last year and you better open your eyes to that fact.

On Oct 25 05:11 PM bobbybutte wrote:

> In case you are not "joking" let me let you in ona secret
>
> The power of reinvested dividends is POWERFUL
>
> jeremy siegel says since 1900 it was 97% of the dows gain
>
> In 1971 the market was grossly overvalued but FACTOR in the REINVESTED
> DIVIDENDS and then check your overall return HUGE DIFFERENCE
>
> In 1990 Gold was 400 less than half of its 1980 high
>
> Gold is now up about 150%
>
> Coke was 5 dollars a share .its up 1100% + the dividends have ranged
> from 3% in the first year to 32% of the original purchase price

>
> When factoring in the reinvested dividends it SWAMPS GOLD
>
> Read Jeremy Siegels study of the power of reinvested dividends

>
> The system will make you financially independent I know because it
> happened to me
>
> In case you did not know.peace

Estimate Revisions and 'The Earnings Season Racket'

Sat, 24 Oct 2009 12:35:08 -0400

This "beats" stuff sounds silly to me. As a former CFO of public companies I can sure you no company is going to estimate future earnings any higher than absolutely necessary not to cause a panic and the upside estimate will always be low enough that the we expected to beat it easily. What company would be stupid enough to estimate earnings that they did not expect to beat handily.

But since no one cares about fundamentals any more, I guess this hocus pocus method works as well as any other.

Stocks Threatened by Inflation

Tue, 20 Oct 2009 15:48:59 -0400

Hardly anyone pays any attention to purchasing power of their investments anymore and all they care about is the "gain" in terms of the almost worthless US $.

Continuing to monitor one's wealth by dividing their wealth by the price of gold is a simple way to tell whether you are winning or losing.

The market seems to be highly overpaying for stocks today based on projected earnings and high P/E's that make little sense and throwing in inflation will only make it worse as the author says.

To Heck with Fundamentals: Dow 11,000 Is Up Next

Mon, 19 Oct 2009 22:38:46 -0400

I guess what you are saying is that a lucky guess makes up for brains. Sometimes that is true, but to conclude the market is where it should be shows a total lack of intelligence. Agreed the panic of last Oct and Mar were probably overdone, but so is the new panic buying.

Oh you forgot to mention that Even DOW 10,000 today is worth less than 75% of DOW 10,000 in 2000 and that the main rise recently in the markets is the crashing dollar that will evemtually take many of you over agressive buls for a long ride down a steep mountain when you finally realize that all the "profits" you made and forecast won't buy you a cup of coffee..

The Greatest Depression Is Coming

Sat, 17 Oct 2009 12:32:48 -0400

You are on the right track. I love the definition of the modern balanced portfolio - Gold, Silver, Food and protection.

On Oct 17 09:32 AM Pauly B wrote:

> You have done a great job laying out your case and not that I dont
> disagree on many points.
>
> Now what is your solution to this mess? Please tell!
>
> Do I start buying up survival food and run to the mountains to live?

How to Play the Next Great Bull - Matt McCall

Fri, 16 Oct 2009 14:51:51 -0400

Great advice in here with a few exceptions.

I think GLD is a terrible risk and probably does not own the gold they say they do so someday that will be exposed.

For a balanced exposure to all commodities I like GCC, which has an equal allocation to all. It is not exciting, but rides the commodities boom and protects against a falling dollar.

It is still difficult to say how much of the commodities boom is real profit and how much is just dollar decline, but at least it protects some purchasing power.

Two More Indicators of a V-Shaped Recovery

Fri, 16 Oct 2009 14:03:27 -0400

Dream on dude. The increase in commodity prices is primarily the dying dollar, not increased demand for commodities except a limited increase from China. The surge in prices simply indicates that more people are buying commodities to hedge against the death of the dollar.

Oil is the ultimate example where demand is declining, inventories are at absird levels yet the price goes up.

I have yet to see any growth and contimued "less bad" and relentless unemployment will not lead to any V shaped recovery. There is still so much misery inthe financial markets and banks to come that it will drown any recovery in spite of glowing gov't and media hype.

The rising stock market is nothing but more greed and pumping with endless cash being fed to Wall Street by the FED. There is no reality behind this market rise, but reality will again wipe out the stock market soon enough..

The Arguments for Big Banks

Thu, 15 Oct 2009 18:20:39 -0400

How could we break up the big banks (that are not really even banks) , who would be left to run the US gov't?

How Regulated Does Wall Street Need to Be?

Thu, 15 Oct 2009 16:24:01 -0400

There is no limit to how regulated Wall Street should become.

Their ridiculous practices of risk taking, unbridled greed and market maipulation resulting in billions of unwarranted profits and bonuses needs to be stopped.

The first step is to strip the banking business out of investment houses. This was just a ploy to get TARP money and calling these entities banks or allowing them to be banks is a blight on the real banking industry and cripples lending.

Derivatives need to be severly regulated and disclosed as they are ticking time bombs that can easily bring down the whole economy. Along with this change maybe throwing in some honest accounting and disclosure rules would also help.

They also need to stop Wall Street from running the US Gov't. This obviously will not be easy, but when Geithner talks to Wall Street CEO's more than the president or congress it points out a clear problem.

Of course the most obviously needed reform is to audit the FED and put huge controls on them or better yet abolish them.

Too bad none of this will ever happen

Break-out or Fake-out?

Wed, 14 Oct 2009 16:27:38 -0400

The whole financial world and the US economy are riding the gov't and medias giant FAKE OUT

The FED is destroying interest earnings for millions of retirees and therefore destroying income necessary for recovery just so they can pimp for their failed banks. Bottom line: Right now, $1,000 invested in a 3-month Treasury bill yields a meager $1.20 in yearly interest. At that rate, just to match the 5 percent interest you could have earned on T-bills in early 2007, you’d have to leave your money sitting there for 42 years! U.S. savers are obviously getting shafted.

The U.S. Treasury Gobbling Up Available Credit, Crowding Out Nearly All U.S. Businesses!

Due to giant bailouts and out-of-control federal deficits, the U.S. Treasury is now borrowing money at the fastest rate of all time, hogging nearly all available supplies of credit. Meanwhile, American businesses and average consumers are getting shut out or even shoved out of the credit markets.

In the first half of this year, the Treasury has stepped up its pace of borrowing to annual rates of $1.4 trillion in the first quarter and $1.9 trillion in the second quarter. That’s 3.5 times and six times more than last year’s pace, respectively.

Meanwhile, businesses are getting crumbs: Last year, banks provided new credit at the annual pace of $472.4 billion in the first quarter and $86.7 billion in the second. This year, on a net basis, they’re not providing any credit whatsoever. In fact, they’re actually liquidating loans at the rate of $857.2 billion in the first quarter and $931.3 billion in the second.

Ditto for mortgages. Last year, mortgages were being created at the annual clip of $522.5 billion and $124 billion in the first and second quarters, respectively. This year, they’ve been liquidated at an annual pace of $39.3 billion in the first quarter and $239.5 billion in the second. WIth a foreclosure every 13 seconds this will only get much worse.

For consumers to borrow on credit cards and with other consumer loans is even tougher. Last year, people were able to add to their consumer credit at annual rates of $115 billion and $105 billion in the first two quarters. This year, in contrast, they’ve been forced to cut down their credit balances at annual rates of $95.3 billion in the first quarter and $166.8 billion in the second quarter.

Clearly, consumers, small businesses, and even larger businesses are also getting shafted.

But Wall Street Traders Reap Gigantic Rewards While Average Workers Face Worst U.S. Job Market Ever Recorded!

So it should come as no surprise that, with the U.S. Federal Reserve virtually guaranteeing a fantasy land financial environment for banks, GS has hit the jackpot this year: The bank has accumulated a bonus pool of an estimated $16 billion to dish out to an exclusive group of its heavy hitters as part of Wall Streets pool of an estimated $140 billion. That’s enough to cover a $50,000 bonus check for each and every household living in Los Angeles, Chicago, San Francisco, and Detroit.

Meanwhile, all across the USA, with small and medium-sized businesses unable to get credit or hire Long-term joblessness has hit the highest level in at least a half century: The share of the unemployed who were out of work for at least six months reached 35.6 percent in September, the most since the U.S. Labor Department began keeping statistics in 1948.

More than 5.4 million people have been unemployed for at least 27 weeks, with 1.3 million expected to exhaust their benefits by the end of this year. 15 million unemployed Americans are competing for 3 million available jobs, the worst on record, while 35 million remain on food stamps.

More than 7.2 million jobs have been lost in the past 21 months. In contrast, in the 30 months of the past recession, only 2.7 million jobs were lost. The official unemployment rate, at 9.8 percent, is just the tip of the iceberg. The true unemployment rate, including part-time workers who can’t find full-time jobs and workers who have given up looking, is 17 percent according to the U.S. Labor Department and 21.4 percent according to Shadow Government Statistics.

Anyone thinking that this Stock Market miracle reaching over 10,000 today while the US dollar is getting crushed is not a head fake will soon learn a lot ablout false hope.