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Bonds & Interest Rates

The 2008 Financial Crisis Was Nothing Compared To What Lies Ahead


Posted by Michael Snyder

on Tuesday, 07 February 2012 09:31

The people out there that believe that the U.S. economy is experiencing a permanent recovery and that very bright days are ahead for us should have their heads examined.  Unfortunately, what we are going through right now is simply just a period of “hopetimism” between two financial crashes.  Things may seem relatively stable right now, but it won’t last long.  The truth is that the financial crisis of 2008 was just a warm up act for the economic horror show that is coming.  Nothing really got fixed after the crash of 2008.  We are living in the biggest debt bubble in the history of the world, and it has gotten even bigger since then.  The “too big to fail” banks are larger now than they have ever been.  Americans continue to run up credit card balances like there is no tomorrow.  Tens of thousands of manufacturing facilities and millions of jobs continue to leave the country.  We continue to consume far more than we produce and we continue to become poorer as a nation.  None of the problems that caused the crisis of 2008 have been solved and we are even weaker financially than we were back then.  So why in the world are so many people so optimistic about the economy right now? The Next Next Financial Crisis Will Be Devastating To The Economy

 

Just take a look at the chart posted below.  It shows the growth of total debt in the United States.  During the financial crisis of 2008 there was a little “hiccup”, but the truth is that not much deleveraging really took place at all.  And since the recession “ended”, total credit market debt has gone on to even greater heights….

Total-Credit-Market-Debt-Owed-440x264



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Stocks & Equities

Why Jim Rogers Is Bearish on the U.S. and Facebook


Posted by Jim Rogers

on Tuesday, 07 February 2012 08:25

Famed investor Jim Rogers has already said he wouldn’t buy Facebook when the social networking giant has its IPO later this week. “No, that kind of stock I don’t buy. They are usually very, very expensive. A lot of people like to buy expensive stocks like that, but I do not,” said Rogers to CNBC yesterday.

However, that Rogers seems bearish on the internet company shouldn’t necessarily drive one away from Facebook. Rogers is bearish on…well, just about everything in America these days.
“It has been demonstrated many, many times before that sellers are usually smarter than the buyers, and they usually know when the best time to sell is, and Facebook is doing it,” he said. Rogers also stated his general opposition to the high prices in the Tech sector, saying ”I am interested in technology in some shape or form, but I can’t imagine buying any of them. They are a bit hot these days and they have been for two or three months, so that is why I am short. I don’t buy high-priced stocks.”

 

....read more HERE



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Timing & trends

Get Rich Slow


Posted by Patrick Cox - The Daily Reckoning

on Tuesday, 07 February 2012 04:22

Get-rich-quick investment advice is a fantasy. Get-rich-slow is a validated strategy for real wealth.

Today, it is more important than ever to keep the long-run perspective firmly in mind...

Lest you’ve forgotten, world financial markets are in a state of unparalleled disorder. More capital has been drained from markets, thanks to the irresponsibility of politicians and the acquiescence of naive citizens, than at any time in modern history. The damage done by bombers and tanks in world wars has been matched by the unintended consequences of central planning and bureaucracies.

Fortunately, however, the political and philosophical trend lines are all pointing to true long-term reform. The pendulum’s swing cannot be stopped, and the coming decades will be unmatched in terms of technological progress and wealth creation.

This is exactly the time to be investing in the future. Metaphorically, and sometimes actually, there is blood in the streets. You’ve probably heard that Baron Rothschild, the famously successful 18th-century British investor, said, “The time to buy is when there’s blood in the streets.” In fact, some believe the original quote was, “Buy when there’s blood in the street, even if the blood is your own.”

Remember, investors who bought and held a diversified portfolio of disruptive technologies before and during the Great Depression got rich. Those who lost confidence because they weren’t seeing the quarterly gains typical in bull markets missed their golden opportunity to “buy low.”



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Timing & trends

The Big Picture - Key Turning Dates


Posted by Victor Adair for Moneytalks

on Tuesday, 07 February 2012 04:10

In my market comments last year I frequently referred to the KEY turn dates of May 2 and Oct 4...when the directional trends of a number of important markets changed. For instance, the S+P 500 and Crude Oil both made important highs on May 2 (and the US Dollar made an important low) while on Oct 4 the S+P 500 and Crude Oil both made important lows (and the US Dollar made an interim high.)

 

Last year, as markets approached the KEY HIGH turn date of May 2, 2011, bullish enthusiasm was very strong across asset classes....silver was charging to $50 an ounce and the VIX traded down to a 4 year low...the COT data indicated that speculators were very aggressive buyers. I was anticipating that the (bear market) rally from the March 2009 lows was reaching a crescendo...but I was waiting for a confirmation that a top had been made.

 

May 2, 2011 turned out to be a significant high in a number of markets and prices declined into late June. There was a "bounce back" rally into July (which took a few markets like AUD, CAD, Copper to marginal new highs) but then most asset prices (except for gold) fell sharply through the August/September period into the KEY Oct 4 lows. During that break the VIX rose sharply and by Oct 4 it hit 46%...three times what it had been at the May 2 highs...a great indicator of a bearish extreme. Since the Oct 4 lows in stocks and commodities the VIX has tumbled to 17% this Friday....its lowest level since July of last year....as rising asset prices have dampened the market's anxiety.

 

Over the past several weeks asset markets have "wanted" to go higher...a "risk on" environment....especially since the Euro joined the party and turned higher in mid-January.



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Gold & Precious Metals

Plenty of big money to be made …


Posted by Larry Edelson: Uncommon Wisdom

on Monday, 06 February 2012 08:02

Ed Note: To watch this commentary in video go HERE

 

Let me say — in no uncertain terms — that if you think all these markets that are rallying are about to shoot to the moon, I think you need to stand back and be very, very careful.

 

Yes, everything from gold to silver to stocks are rallying — but that does not mean the rallies are the real McCoy — and that they are going to continue to rally. Indeed, ALL of my indicators continue to suggest that big traps are being set, and the next big moves will not be UP, but instead, will be DOWN.

 

Let’s go right to the charts. Here’s my latest gold chart.

Gold



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