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bkpark

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  • The Europeans are nowhere near a debt solution because they lack "cohesion and courage," observes Steven Rattner. It was just another kick the can down the road moment last week, and they're still nowhere near solving any of their problems. With an almost a 1:1 correlation between the euro and the S&P 500, Rattner says he's actually surprised there hasn't been a bigger selloff. (video)  [View news story]
    Read up on George Washington if your anti-Americanism would permit you to. *After* he declined to run for third consecutive term, he wasn't too old to serve as the senior officer of the army.

    There are indeed very few honorable people in history---America is just lucky to have had one of them in its founding history, starting the nation on the right foot.
    Dec 15 11:28 AM | Likes Like |Link to Comment
  • Initial Jobless Claims: -19K to 366K vs. +9K consensus. Continuing claims +4K to 3.60M.  [View news story]
    Don't forget the new entrants (or who would have been new entrants) to the workforce from population growth (thankfully in U.S., we are still growing, unlike Japan, etc.).

    As some analyst said somewhere, if we add only 200k net jobs per month we will *never* reach full employment, because 200k net job growth is actually a step backward (just smaller than, e.g. 0 net job would be)
    Dec 15 10:26 AM | 1 Like Like |Link to Comment
  • Dennis Gartman fires up another prediction for gold, saying this time that the bear market is here after an 11-year run of higher prices. He finds the progression of lower highs and the "confirmation" that the new interim low is below the previous low is all the evidence he needs to see. "We have the beginnings of a real bear market, and the death of a bull." [View news story]
    Once you recognize that gold is no different than any other form of currency (except that it's not as easy to manipulate as completely fiat currencies), then there's really only one rational course of action: place no faith in gold---or USD (and by heavens, not EUR).

    For my part, my reliance is on, well, the human capital---the types of labor I can do under any circumstances. And if I see global economic collapse in progress, I'll be sure to stock up on ammunition---not gold; I can always barter my guns and bullets for gold later if need be.
    Dec 15 01:29 AM | 1 Like Like |Link to Comment
  • The parallels between events unfolding today and those which brought upon "The Long Depression" of 1873 are facinating, says MarketWatch contributor Matthew Lynn. Cheap money, banking de-regulation and an ill-fated attempt to merge European currencies in the late 19th century created a bubble that, when it burst, brought about an economic collapse that lasted an epic twenty-three years. Past as prelude, perhaps?  [View news story]
    It might have something to do with the fact that the exact composition of fracking fluid is a trade secret.

    Greenies are like many superstitious people before them: they fear what they do not know (sometimes they are justified after the fact, but more often than not, they are an impediment to progress).
    Dec 15 01:11 AM | Likes Like |Link to Comment
  • Dennis Gartman fires up another prediction for gold, saying this time that the bear market is here after an 11-year run of higher prices. He finds the progression of lower highs and the "confirmation" that the new interim low is below the previous low is all the evidence he needs to see. "We have the beginnings of a real bear market, and the death of a bull." [View news story]
    "Again, you are far too focused on physical gold. The dollar was denominated in gold from 1934-1971...did people pull out gold eagles and a nail filer to pay for their groceries?"

    Not true. USD was pegged to gold *only if* you were a foreign owner of USD (like a foreign central bank). For U.S. citizens (by far the largest user of USD), that redemption option of 1 oz of Au for $35 was not available---besides, the whole facade demonstrably collapsed when Nixon declared Bretton Woods null and void unilaterally, because, frankly, the pretense that USD was actually backed by gold (and that the only reason one rather held USD was because it paid interest, while gold didn't), was an unsustainable illusion.

    I'm not in principle opposed to gold standard (and for the way it to work, one global reserve currency like USD will have to be pegged to gold, while the rest of the world's currencies are kept floating relative to USD), but not at today's elevated gold prices. First the current bubble in gold must burst, before any kind of semi-permanent peg to gold in USD is determined.

    Anyways. To me, at the end of the day, all moneys are the same---it's valuable only by the virtue of the fact that some people (strangely) perceive them as valuable; they have no intrinsic value in and of themselves (not USD, and definitely not gold). I won't understand those people who give value to these things, but that doesn't mean I'm opposed to using them to buy things that have intrinsic value---like food.
    Dec 15 01:03 AM | Likes Like |Link to Comment
  • The Europeans are nowhere near a debt solution because they lack "cohesion and courage," observes Steven Rattner. It was just another kick the can down the road moment last week, and they're still nowhere near solving any of their problems. With an almost a 1:1 correlation between the euro and the S&P 500, Rattner says he's actually surprised there hasn't been a bigger selloff. (video)  [View news story]
    And of course, that's why he refused to run for a third term, even though he'd have run unopposed. It's his dastardly plan to retain his oligarchic power by giving up being the president.

    There are some who are simply created in tho mold of Cincinnatus (I have to confess I don't think I'm one of them).
    Dec 14 11:49 PM | Likes Like |Link to Comment
  • Dennis Gartman fires up another prediction for gold, saying this time that the bear market is here after an 11-year run of higher prices. He finds the progression of lower highs and the "confirmation" that the new interim low is below the previous low is all the evidence he needs to see. "We have the beginnings of a real bear market, and the death of a bull." [View news story]
    With one little difference: Vietnam was a tiny country with negligible impact on global economy (although some argue that the Vietnam war was the war that bankrupted us ... and did lead to the abolition of the pseudo gold standard we had until 70s). Vietnamese currency could be worthless and no one cared.

    Whatever global event causes USD to become worthless is going to be ... apocalyptic, to put it mildly. In that case, I wouldn't want gold; I'd want guns, bullets, and lots of canned goods (and a sturdy bomb shelter wouldn't hurt either).

    You can't eat gold; you can't use gold, the only way gold will be useful is if others perceive some value in gold---the way USD is useful to people today.
    Dec 14 09:35 PM | 1 Like Like |Link to Comment
  • Dennis Gartman fires up another prediction for gold, saying this time that the bear market is here after an 11-year run of higher prices. He finds the progression of lower highs and the "confirmation" that the new interim low is below the previous low is all the evidence he needs to see. "We have the beginnings of a real bear market, and the death of a bull." [View news story]
    Well. Try paying your taxes with your bits of gold.

    What backs the dollar, at the end of the day, is the fact that it's the only form of payment U.S. government will accept when it demands payment (of taxes, fees for services, etc.; and, for the record, U.S. has never repudiated the dollar, although it has banned private ownership of gold at one point (and tried to abolish contracts that specified payment in gold)).

    If U.S. government demanded bushels of grain when April 15th came along, bushels of grain would be the preferred form of money in U.S.---but from the point of view of Uncle Sam, it's probably preferable that the money take a form which it can control and create out of thin air.

    BTW, as long as gold prices remain high, I don't see current governments taking it up as currency. It's the high gold price (i.e. deflation of the late 19th century) that pushed us to bimetalism in the first place; high gold price will push us away from gold standard even if there is some political preference for it.
    Dec 14 09:21 PM | 1 Like Like |Link to Comment
  • Lowe's (LOW +0.6%) walks into a giant buzzsaw after it pulls its advertising from a reality show about Muslim families due to protests from a conservative group. Politicians have grabbed ahold of the issue to rail against the company from the House floor (video), while celebs take to the media to call for boycotts of the company's stores. [View news story]
    Um, since you can't read between the lines, let me just spell it out for you: prejudices have always been there, and they always will be there. Even the stellar performance (not to mention the loyalty displayed) of 442nd Regiment wasn't enough to dispel the public's bias against "the Japs" (time did much better work, as decades spent *not* fighting the Japanese dissipated away most of the hostility).

    If anything, Americans' *lack* of overt hostility against Muslims in general is more surprising than anything else (watch the polls; atheists are more disliked than Muslims in U.S., and they never bombed any American ships or skyscrapers, although if you count Unabomber as one of them the American history isn't free of atheist violence), for which I credit what GWB did in the aftermath of 9/11. But so long as most of our enemies are Islamists, it's unnatural to expect that the public will not have negative reactions to Muslims (even those who are on our side). History has *never* worked out that way.

    It's natural, emotional reaction to hate those who are associated with those who keep attacking us---and in the cases of Major Hasan and a few naturalized Americans who are Muslim (like the would-be Times square bomber), such reaction seem, at least superficially, justified (once again, I'm more surprised by the *lack* of American hostility against Muslims in general).
    Dec 14 07:11 PM | 1 Like Like |Link to Comment
  • Lowe's (LOW +0.6%) walks into a giant buzzsaw after it pulls its advertising from a reality show about Muslim families due to protests from a conservative group. Politicians have grabbed ahold of the issue to rail against the company from the House floor (video), while celebs take to the media to call for boycotts of the company's stores. [View news story]
    Well, we did intern all the Japanese, even those who were natural born American citizens.

    And even after they volunteered to fight for U.S., we never let them fight in the Pacific theater (look up 442nd Infantry Regiment).

    I'm guessing we didn't do the same with the Germans mainly because it was too impractical (too many of them in the country by then, although some Germans *were* interned).
    Dec 14 06:32 PM | Likes Like |Link to Comment
  • Ugly chart of the day: The U.S. residential housing market is very closely tracking the Japanese experience, shifted 15 years.  [View news story]
    No, but he will be right one of these days. ;)
    Dec 14 03:08 PM | 1 Like Like |Link to Comment
  • Amazon (AMZN) shares slumped nearly 5% today after the weak retail sales report, but Mercenary Trader says prolonged weakness in the stock can be traced back to the decision to pursue revenue growth at the expense of profit, with each Kindle Fire being sold at a substantial loss. The many choices for consumers - at least 55 tablets - make AMZN's strategy a risky one. and investors know it.  [View news story]
    Just because Amazon might be selling things at a loss (or very small profit margin) doesn't mean FedEx/UPS will deliver them at a loss (although surely there's some volume discount). I don't think there is necessarily a contradiction here.
    Dec 14 03:04 PM | Likes Like |Link to Comment
  • A group of startups that includes Twitter is petitioning the SEC to amend a rule requiring them to publish financial data after possessing 500 or more shareholders. The companies argue the rule forces them to either refrain from offering stock options to new employees, or go public before they're ready. Facebook is reportedly planning an IPO partly on account of the disclosure rules.  [View news story]
    Maybe they should be paying employees *cash*, not options that could be worthless in a few years, especially once they've reached certain size and age.

    I mean, how many employees do they have who can materially impact the company's fortunes so that there is some incentive-aligning argument to be made?
    Dec 14 01:34 PM | 2 Likes Like |Link to Comment
  • Nokia (NOK) is excited to return to the U.S. smartphone business, starting with its entry-level Lumia 710. But typical PR spin seems to have been overwhelmed by flat-out denial: "What we see is that youth are pretty much fed up with iPhones. Everyone has the iPhone... Youth that wants to be on the cutting edge and try something new are turning to the Windows phone platform." Where's the evidence?  [View news story]
    And Nokia, the former reigning champion of smartphones (at least it was outside U.S.) is the new shiny thing?

    Maybe Lumia 710 is better than its entry-level Symbian phones, but I've been pretty much turned off by Nokia E5 (which I endearingly call "buggy piece of crap").
    Dec 14 11:51 AM | Likes Like |Link to Comment
  • You can't even buy the stock yet, but Sterne Agee wastes no time in slapping a Sell label on Zynga ahead of the company's massive IPO on Thursday. The social network game maker faces slowing revenue growth and depends too much on Facebook: "Zynga’s growth is slowing even faster than what is obvious at first. Its margins are under pressure, and free cash flow has been declining."  [View news story]
    Clearly what he means by the "sell" rating is that Zynga *should* sell its own stock while it still can. ;)

    Don't you have to wait quite a while if you want to short a stock that's newly on IPO?
    Dec 13 06:42 PM | 1 Like Like |Link to Comment
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