Best Of The Best Share Discussion Threads

[traderabc] 13/2/2010 13:11

Edited This could be a geo political event in the making, the last bastion of free speech in the western world?

Iceland aims to become an offshore haven for journalists and leakers
By Jonathan Stray / Feb. 11 / 9 a.m.

On Tuesday, the Icelandic parliament is expected to introduce a measure aimed at making the country an international center for investigative journalism publishing, by passing the strongest combination of source protection, freedom of speech, and libel-tourism prevention laws in the world.

Supporters of the proposal say the move would make Iceland an “offshore publishing center” for free speech, analogous to the offshore financial havens that allow corporations to hide capital from authorities. Could global news organizations with a home office in Reykjavík soon be as common as Delaware corporations or Cayman Islands assets?

[traderabc] 13/2/2010 13:10

On the Edge with Max Keiser – 12 February 2010
February 13th, 2010 by stacyherbert

Stacy Summary: Here it is! Guest is Mish Shedlock.

[selfservice] 13/2/2010 13:05

The fact that Greece represents just 3% of the Eurozone GDP means that it is easier and cheaper to bail out than not to. Greece's budget deficit is currently 12.8% of their GDP

And bail Greece out they will as the ramifications of Greek sovereign default dont bear thinking about.

Germany's debt is much higher yes, but it is not out of proportion with its GDP which is the case with most of the PIGS (Portugal,Ireland,Greece, and to a lesser degree, Spain)

A lot of stress on the system, but nothing, just a blip compared to the next shoe about to fall or be bailed out - California. Greece's economy is about 1/5 the size of California's economy and while Greece makes up just 3% of the total euro-zone GDP, California makes up 13.5% of the U.S. GDP. If the potential default of Greece is causing a flight from the Euro, imagine what is going to happen to the U.S. dollar if the state of California nears default?

[traderabc] 13/2/2010 13:04

Fear Takes the Wheel

Peter Schiff
Feb 12, 2010

Over the past three or four years a strange phenomenon has developed in the global investment markets. With some exceptions, many asset classes, in particular domestic and foreign equities, commodities, and foreign currencies have tended to move in the same direction on a day to day basis. The mega-correlation has lasted so long that most now take it for granted. This leaves investors with relatively simple choices: when to get in to the market in general and when to park assets in cash and U.S. Treasuries.

However, few recall that this pattern is relatively new in the annals of financial history. Fewer still realize the reason for the current anomaly. From my perspective the most logical explanation is fear, which has become global, pervasive, and persistent. Traditionally, when investors fear inflation they buy stocks, commodities, gold, and foreign currencies, and sell dollars and U.S. treasuries. When they fear deflation they sell stocks, commodities, gold, and foreign currencies, and buy dollars and U.S. treasuries. The problem is that right now, no one knows which one to fear. Depending on the news the pendulum swings from one extreme to another on a daily basis.

[contrarian2investor] 11/2/2010 21:26

Hi all,

It would appear that the commodity plays are going to get even more crowded, if further ETF's get approved.

Although I am a long-term bull advocate of gold and palladium. It worries me somewhat when too many people queeze onto the same play. Albeit that we have hedgies John Paulson and David Einhorn amongst the many commodity ultra-bulls.

New Precious Metal ETF Planned
ETF Securities Files for Gold, Silver, Platinum, and Palladium ETF
By Luke Burgess
Wednesday, February 10th, 2010



c2i

[traderabc] 11/2/2010 14:51

Wednesday, February 10, 2010
Ferguson and Faber: Sovereign Debt Crisis Will Spread World-Wide, U.S. Debt Is Unsafe



In a must-read essay, Niall Ferguson slams the prevailing Keynesian consensus, and says that the sovereign debt crisis in Greece will spread to America:

What we in the western world are about to learn is that there is no such thing as a Keynesian free lunch...

US government debt is a safe haven the way pearl harbor was a safe haven in 1941.


And in a must-watch interview, Marc Faber says that the US, Europe and the entire developed world will default on their debt:

[traderabc] 11/2/2010 12:49

Confused? So are the markets


Unusually strong crosscurrents are creating chaos in markets all over. We need to step back to sort out what's happening with stocks, bonds, currencies and gold.
[Related content: stocks, bonds, gold, currencies, Bill Fleckenstein]
By Bill Fleckenstein
MSN Money

Spending a week away with no TV or newspapers and only limited Internet access, as I did recently, gave me lots of time to think about the present investing environment, where there is mass confusion in all markets. Unusually strong crosscurrents make it difficult to ferret out what participants are thinking or anticipating.

[traderabc] 11/2/2010 12:44

Thanks c2i, this bit (below) echoes Rogers views to some extent. Indecently Faber along with Rogers are key speakers at a Vince Stazione's financial conference in London in March, if anyone who frequents this thread goes to it perhaps they could comment?



'A possible crash in China’s economy will be “disastrous221; for raw materials used in industrial production, Faber said. He instead favors commodities including wheat, corn and soya beans and also said he doesn’t see a “huge downside risk” for gold.


“Other commodities haven’t gone up yet, such as the grains,” Faber said. “It may take time until they start to go up substantially but if you have time, you should be long wheat, corn, soya beans or own a farm, which is one way to participate in future food price increases.”'

[contrarian2investor] 11/2/2010 11:28

traderabc,

Keep up the good work.

Here is an article that might be of interest:

China Economy Will Slow, Hurt Commodities, Faber Says (Update1)
February 11, 2010, 05:18 AM EST



c2i

[traderabc] 10/2/2010 13:21

And here is another, one day we shold see the 'mighty' US $ do exactly the same, and I doubt the pound or euro are any better, fiat currency seems to have become a gigantic ponzi fraud and it looks like the market is starting to realize it.

[traderabc] 10/2/2010 13:18

In a few more years a lot more people may be thinking this...

I KNEW I SHOULD HAVE BOUGHT GOLD
by I. M. Vronsky
Editor-in-Chief, Gold-Eagle.com
February 8, 2010

All should be moved by the following dramatic picture and eye-popping gold price charts. The first is an actual photo of currency traders in Sao Paulo, Brazil in early 1999.

The chart shows how the Brazilian currency (called the "real") price of gold soared nearly 80% in a two week period in January 1999. I believe the US dollar price rise of gold will be equally dramatic, violent and without notice sometime during the next 6-8 months.

Economic and monetary crisis overwhelmed Brazil - as it did a few years later to Argentina and twice in Venezuela...and is a 'preview' of what the US may well see during 2010

To use apropos Chinese cliché, "a picture is worth a 1,000 words"

--------BRAZIL JANUARY 1999

“Eu sabia que devia ter comprador ouro!”
"I KNEW I SHOULD HAVE BOUGHT GOLD”









Consequently, one is either on-board...or left at the station with a bag full of fiat paper, wringing his hands and screaming his lungs out:

"I KNEW I SHOULD HAVE BOUGHT GOLD!”
“Yo sabia que debia haber comprado el oro!”
“Eu sabia que devia ter comprador ouro!”

However you want to say it, never leave home without some investment in precious metals. Your personal real wealth depends on it.

Unfortunately, by yearend some hapless investors who only listen to CNBC will be crying in their beer, mumbling, "I cudda, I wudda, I shudda...


© 2010 I. M. Vronsky

[traderabc] 10/2/2010 12:21

Keiser Report №15: Markets! Finance! Scandal!

[traderabc] 06/2/2010 14:59

O49balt, thanks for your explanation, now I understand.

I see from this article that if you own the land you work, things are already going your way as far as value is concerned, according to this (probably biased) article prices are going to double by 2012


14 October 2009 - Tara Loader Wilkinson
Buying farmland is as good as gold

Investing in agricultural land is proving a valuable defence strategy for many looking to protect their assets.


New research from estate agent Knight Frank shows that UK farmland has outperformed the FTSE 100, prime country house prices and prime London property.

[traderabc] 06/2/2010 14:51

Press TV-On the edge with Max Keiser-02-05-2010(Part1)



Part 2


Part 3

[049balt] 05/2/2010 20:06

Finally there is one thing that I don't understand, perhaps you can explain, why are farmers producing and selling at lower then production costs?
That doesn't make sense, and should not be economically possible for more then a year or two, those farmers 'should' be going bankrupt and ceasing production and thereby reducing supply and ultimately causing prices to rise.

Good question, the answer is very simple, every year I get subsidies from the EU called the Single Farm Payment added to what I get from the Irish Government ie. envoirmental schemes, I am able to keep producing, albiet at a loss.

[i_hopi] 05/2/2010 19:56

Has Dim dumped his gold yet?

[traderabc] 05/2/2010 19:54

More Government Equals Fewer Jobs

Peter Schiff
Feb 5, 2010

With today's unexpected decline in December payrolls, the cry for more job-related stimulus will grow even louder. But the sad truth is that any new stimulus or jobs bills will ultimately swell the ranks of the unemployed, thereby raising calls for an even bigger federal effort. If we are not careful, government regulations, subsidies, and spending, all designed to fight unemployment, could push the labor market into a death spiral.

Regulation acts like a tax on job creation. By subjecting employers to all sorts of extra expenses when they hire people, regulations increase the cost of employment far beyond the wages employers actually pay their workers. In fact, some regulations are specifically tied to the number of workers employed. This provides some employers with a strong incentive to stay small and not hire.

[traderabc] 05/2/2010 18:28

Frank Holmes: Game-Changing Action Is Afoot
Source: Interviewed by Karen Roche, Publisher, The Gold Report 02/03/2010

Specializing in emerging markets, natural resources and global infrastructure, U.S. Global Investors is positioned so perfectly for the times that CEO Frank Holmes might have written its business plan and tag line—"Resourceful Investing for a Developing World"—this morning. All of these areas of expertise at U.S. Global Investors play powerful but somewhat unpredictable roles in the evolving 21st century worldwide economy. Led by China and India, the emerging markets have placed unprecedented (and growing) demand on natural resources. From gas and oil to copper and zinc, it takes vast quantities of those natural resources to build infrastructure to accommodate explosive growth in population, upward mobility, urbanization and industrialization. So as the other Holmes once said, "The game is afoot." Meanwhile, the developed world can hardly sit by and watch the action from afar. As Frank suggests in this exclusive Gold Report interview, the key to staying in the game—even as the rules are changing—may lie in adapting nimbly and rationally.

[traderabc] 04/2/2010 23:21

Obalt, firstly can production respond to increases in prices? Silver and gold production has not increased meaningfully over the last decade, yet there have been very big price increases.
Rogers tells us that world food inventories have never been lower. As we now live in a global economy, prices (to a certain extent)are set globally, not regionally. If prices in the UK are too low, the food will be exported to Europe to achieve the higher Euro prices offered.

This brings me to my next point, the pound is in danger, it could fall badly, when/if it does, UK food producers will export even more of their produce to be be paid in higher value Euros.
The effect of this should be quickly translated into higher £ Sterling prices here. From my limited understanding of the matter this process has already occurred but will accelerate with any further falls in Sterling, (a real possibility)

Finally there is one thing that I don't understand, perhaps you can explain, why are farmers producing and selling at lower then production costs?
That doesn't make sense, and should not be economically possible for more than a year or two, those farmers 'should' be going bankrupt and ceasing production and thereby reducing supply and ultimately causing prices to rise.

[049balt] 04/2/2010 22:48

trader, as a farmer I still find it very hard to be bullish on Agri commodities, certainly in the short to medium term. If farmers are willing to produce at below the cost of production then what will happen if prices do rise ? production will respond and we will have over supply.

[traderabc] 04/2/2010 22:39

Keiser Report №14: Markets! Finance! Scandal!

[traderabc] 04/2/2010 20:51

10 Geopolitical Predictions for 2010 & Short Term Strategic Outlook


A great - and still growing - divergence appeared in 2009 between public statements by leaders and their public performance. The politicized, romanticized theater of increasingly populist “democratic221; leaders and media seemed to be of a different planet from activities taking place in the real world.

While a large part of the global population appears still transfixed by words, there is a growing perception that great fissures already rend the global strategic architecture.

This is a trend which will compound during 2010.

There is a widespread belief that the world has “ducked the strategic bullet” of global economic collapse, but this is merely the delusionary euphoria of the severely wounded patient. Severe structural damage has occurred to the key driver of global economic stability, the United States. Most major economies of Western Europe and Asia, although in plight, have been protected in their fall by a complex web of structures and the fact that they were not, in many respects, as leveraged as the US. Britain and Japan, however, remain leveraged in their debt-to-asset ratio, to a death-defying degree.

[traderabc] 04/2/2010 12:33

The Bankruptcy of the United States is Now Certain



Porter Stansberry
Silverbearcafe
Thursday, February 4th, 2010

It’s one of those numbers that’s so unbelievable you have to actually think about it for a while… Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that’s not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That’s an amount equal to nearly 30% of our entire GDP. And we’re the world’s biggest economy. Where will the money come from?

How did we end up with so much short-term debt? Like most entities that have far too much debt – whether subprime borrowers, GM, Fannie, or GE – the U.S. Treasury has tried to minimize its interest burden by borrowing for short durations and then “rolling over” the loans when they come due. As they say on Wall Street, “a rolling debt collects no moss.” What they mean is, as long as you can extend the debt, you have no problem. Unfortunately, that leads folks to take on ever greater amounts of debt… at ever shorter durations… at ever lower interest rates. Sooner or later, the creditors wake up and ask themselves: What are the chances I will ever actually be repaid? And that’s when the trouble starts. Interest rates go up dramatically. Funding costs soar. The party is over. Bankruptcy is next.

[traderabc] 03/2/2010 19:41

Old article but still valid.

Economy May 2009 Atlantic
The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time.

by Simon Johnson



The Quiet Coup



One thing you learn rather quickly when working at the International Monetary Fund is that no one is ever very happy to see you. Typically, your “clients”; come in only after private capital has abandoned them, after regional trading-bloc partners have been unable to throw a strong enough lifeline, after last-ditch attempts to borrow from powerful friends like China or the European Union have fallen through. You’re never at the top of anyone’s dance card.

The reason, of course, is that the IMF specializes in telling its clients what they don’t want to hear. I should know; I pressed painful changes on many foreign officials during my time there as chief economist in 2007 and 2008. And I felt the effects of IMF pressure, at least indirectly, when I worked with governments in Eastern Europe as they struggled after 1989, and with the private sector in Asia and Latin America during the crises of the late 1990s and early 2000s. Over that time, from every vantage point, I saw firsthand the steady flow of officials—from Ukraine, Russia, Thailand, Indonesia, South Korea, and elsewhere—trudging to the fund when circumstances were dire and all else had failed.