Replaying 1929: Business, Financial, and earth change news

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Life in the Paperdigm

If the stock market seems a little wonky this week, it's because most people don't understand the repricing battle that has been going on as the US dollar begins its next decline, as it demonstrated this week.  You'll recall in my Monday report, prefaced by the headline "Dollar Crash Week" I explained how the dollar looked to be in for rough going this week.  You can click the daily dollar chart over at www.ino.com and judge for yourself the quality of the prediction.

 

As I read it, the US dollar, the US buck went from a Monday mid-session high of about 73.1 on the NYBOT to a Wednesday low of 71.85 plus or minus an exchange fee or hamburger.  That's a 1.7% slide in just a couple of days, and where I come from, that would be a pretty good call - definitely a short term trade on the commodity side (I didn't participate, though).

 

More importantly, July NYMEX crude settled out around 132.19, but a move up from 129.93 to the closing high would be accountable by the currency swing alone.

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Flipping over to Yahoo Finance's historical data, I notice that the Dow which closed last week close to 12,987 dropped to near 12,480.  That's a loss of roughly 507-points

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I figure that collective entity which makes up the PowersThatBe are seriously worried about the nervousness of the sheeple when this kind of damage is done to the country's best-known index when CNBC's Jim Cramer spends the opening of the Friday after-closing segment preaching the values of cash and repeating the Street truism that declines are going to happen and they are the best time to buy stocks because they are cheap. 

 

All true enough, provided that you're still willing to play in the paper asset game which I call the 'paperdigm'.  "Expect Corrections, Don't Fear Them" says a Thursday article on the Cramer site.

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The CNBC contest - the Million Dollar Portfolio Challenge has be interesting to watch.  I decided to take a single-decision strategy and bought nothing but precious metals stocks (four of them at 25% allocations each) and just 'let it ride' for the duration of the contest.  Knowing how I feel about "paper assets" this should not surprise you too much.

 

For the week just ended my 'single decision' approach (essentially four darts at the metals group) was good enough to move my portfolio up 8.5% for the one week I've been playing which earns me a rank of 26,416 in the game, although if I'm right about what's to come, my rank should get up to the top 5,000 or so by the end of the game.

 

Of course, since I'm using the output from the 'fuzzy time machine' which seems to suggest a particular movement in the PM's is ahead, it will be interesting to see how well 'single-decision' investing works out between now and when the contest ends on July 18th.

 

If you've always wanted to see what kind of investor you are, this is a fine opportunity to do some 'paper trading' and see how good (or bad) you are compared with the Universe of players in the game.

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As for next week?  My guess - and this is not trading advice, it's only because I'm in the CNBC contest, is that the market will go lower Tuesday/Wednesday and then put on a week ending rally.  The technical indicators I watch are either or, or approaching "oversold".

 

My commodity account continues to evaporate, though, because the move in the metals still leaves me upside down.  however, I expect that to turn around, but then gamblers also are always on the verge of a change of luck, too.

 

Regardless of how the 'play money' is doing, I hold that the long-term outlook for paper is probably OK until after the Beijing Olympics.  Oh sure, maybe an earthquake or some natural disasters / winds between now and then, but in the larger scheme of things I don't expect the world situation to quite li9terally 'blow up' until after the Chinese get their moment of Olympic Glory.  Soon as that's over, though, hold on for the "Year of Manifestation" to kick a lot of folks in the head.

 

This weekend's report for Peoplenomics subscribers addresses a very important question that people who are locked into the "paperdigm" should be thinking about: 

 

Suppose you had no pension?

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I'm just kidding about the word paperdigm though.  I would not be surprised, based on calls for a steel penny earlier this month for someone to actually suggest 'paper dimes".

 

The Runs: Hillary's Gaff or Threat?

The NY Post headlines this morning "Hill's 'Assassin' talk a shocker: Excuse for not quitting: RFK Got Shot in June". 

 

Given that there are web pages with titles like "The Clinton Body Count" (you remember Ron Brown and Vince Foster, right?) the implications could be far-reaching. On the other hand, the Snopes urban legend site labels the 'Clinton body count' false.

 

Nevertheless, over the first cup of coffee it all smells as though the PTB has stuck their foot in it this time, afraid as they are of losing control of their lock on the WH and the District of Corruption.

 

For those watching the linguistics, I'd guess the story fills a lot of the politician who says something stupid along in her expectations.  In the NYT today there's predictable regret.

 

In the Daily News, Michael Goodwin says "Hillary Clinton's colossal blunder simply the last straw."  Sadly, it won't be.

 

Allergic to Bandwidth

A New Mexico group says it's allergic to wi-fi hotspots and wants them banned from public buildings.

 

Don't Tell Gore This...

...but the Red Spot on Jupiter is changing and scientists think it's due to climate change.  But wait!  There's no carbon credit scam on Jupiter...no cars spewing out 'greenhouse gasses' so what gives?  Say, you don't think we're all being played by the PTB, do you?  Naw...tell me it ain't so...

 

'Them Winds'

Still going nuts in the Midwest with strikes in square states.

 

WASF Department

California state lawmakers are considering a 'porn tax' as a solution to the budget shortfall.  Oh my, that's one of the Golden State's biggest exports, I mean aside from fruits and nuts...oh yeah, and vegetables.

 

Africa's Florida

Seems the government of Zimbabwe is doing a little Florida-style voter disqualifying ahead of a president runoff in the land that's going through a Weimar-like inflation.

 

Around the Ranch:  Work

A ton of projects to do around the ranch this morning - so a short column.  Even though Monday is a holiday, there will be a report - although shorter than a normal Monday as I'm taking advantage of the cool mornings to get real farmerly things done ahead of the 90+ heat which comes along around 10-11 AM now.  Summer's here and the new air conditioning system has paid for itself many times over...

 

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Friday May 23, 2008

Quakes, Exits, and 'Next'

You may recall our Friday May 9 headline "Time Monks: A Quake Warning" and the Saturday May 10, 2008 headline "Wedding Quake?" both just in advance of the 8.0 quake which has left 80,000 dead or missing. 

 

Both time monks of www.halfpasthuman.com  and I are amazed at how the 'wedding interrupted' part of the archetypes associated with the quake have been almost like a time separated event as it was just in the past 24-hours that CNN put up "Quake left wedding party in layer of dust" and the BBC posted its coverage of the wedding interrupted at "In pictures: Wedding photos show quake".

 

the time monks and I have been looking at the wedding pictures since Monday when the 'wedding quake' pictures showed up on Leland Wong's journal and a few other places, just to see how the meme would spread and swirl into global media consciousness enroute to CNN and the BBC coverage.  Quite graceful, as design patterns go.  A resonance at the archetype level spreads in interesting ways.  Quick from one place to another, a pause as it's energy congeals, and then off to bigger audiences and such.

 

Now, the meme is also showing up in places like the Kansas City Star's web site.  MFG, can you believe it?  It don't get much more mainstream than that.

 

With that, the "interrupted wedding" linguistics are filled, and the archetype expectation level completed; with these quake photos likely to be the enduring imagery of the event, just as the pictures of the people at the dome in New Orleans were the lasting image of the Kat/Rita events (ill wind and dark companion linguistically).

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Looking ahead, the same technology points to the possibility of something of a large quake in the western US just after the solstice (June 21st), with more precision expected in a few weeks at the linguistic analysis of the current ALTA 0209 (e.g. going for high resolution of events out to February 2009) gets into the later stages of processing and newer data. 

 

Privately, I have to wonder about our discussions of the number 71, and 71,000 (here and here) earlier this week, plus a few other places.  I scratch my head and ask "Hmmm...knowing the Universe plays with humans (or dances with us as unaware followers in the dance as in Dancing Wu Li Masters) might there be some significance to the time around 7/1; July first?

 

I suppose there's some comfort in the time monk's admonishment: "If George can think of it, that about rules out its happening."  OK, Wedding Quakes excepted.  Geographically it's very fuzzy  beyond 'western U.S.)  fuzzy, but between June 21 and mid-September seems like the timeline.

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Although there's still a month (or so) to go, even if the linguistics are right on the Western US quake (and the location vague yet), I'm pleased to report my commodity broker, JB Slear (www.forthwealth.com) and his wife will be moving to a higher elevation from their long-time home in Irvine, California as soon as the commodity markets close today.  He's found a new home, appropriately, on Traders Trail in Prescott, Arizona.

 

Another reader, who left the LA basin in the past few weeks has settled with her prized show horses Columbia and Augusta South Carolina.

 

Not that these people wouldn't be doing this anyway but it's worth noting, I suppose.  Both read the linguistic reports.

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Not that fleeing the next big quake saves anyone; Fate's going to get us all at the appointed hour and spare even the worst of us, if it pleases.  I recall a bit of poetry that puts it into perspective:

Into this Universe, and why not knowing, Nor whence, like Water willy-nilly flowing: And out of it, as Wind along the Waste, I know not whither, willy-nilly blowing.

The Moving Finger writes; and, having writ, Moves on: nor all thy Piety nor Wit Shall lure it back to cancel half a Line, Nor all thy Tears wash out a Word of it.

And that inverted Bowl we call The Sky, Whereunder crawling coop't we live and die, Lift not thy hands to It for help - for It Rolls impotently on as Thou or I.

Wait!  Forget I mentioned that last bit: I'm not sure under the Patriot Act if I can quote Omar Khayyám - Arab fellow, wasn't he? -- without getting on some list.  Once the modern marvel of a 'moving finger' writes people onto The List, no telling if they will ever get off it... I might need to go flying again, if the Western US quake to come gets too close to the family in Seattle...so forget the moving finger stuff and hopefully the linguistics are wrong..

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I don't mean to obsess about quakes past and future, especially since the main point of this site is economic news and analysis.  But 2008 is the year of 'manifestation' and 2009 is the year of 'transformation' and those things that will manifest for the balance of this year to the point of transforming us next, needless to say have huge influence on how things will work out financially. 

 

In a 'prequel sequel to the prequel' I notice that Mexico has offered to send aid to China.  It would not surprise me to see aid from Mexico and elsewhere coming north within the next year as natural disasters (and financial, too) loom here.

 

Other Memes: 'Them Winds'

What's called a mile-wide tornado ripped through Weld County Colorado. The Weather Service charts continue running far ahead of 10-year averages.

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Say, I don't think I would want to own insurance stocks over the next year or two - just thinking out loud here...

 

The Runs: Hillary Going #2?

(Sorry, our headline writers are drunk this morning, having started the long weekend early...)Time Magazine's latest gets to the idea of Hil as Veep.  No more royal Clintons for me, thanks.

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Music to ears?  Once prez wannabe Mike Huckabee was on the Bob Rivers morning show on KZOK up in Seattle this week.  Gee, that brings back the good 'ol days of the rock & roll years when I was doing news with Gary Crow at KOL a bazillion years back.  Crow's been at KZOK seems like forever...

 

"Papier Bitte?" Department: Housing Terrorists?

OK, so terrorists haven't taking to hijacking housing.  But, that's not going to stop the fear-mongers in corpgov from trying to sneak a National Fingerprint Registry into a Housing Bill apparently.  I can almost hear it now: "Geben Sie mich, den Ihre Papiere gefallen, Bürger..." And if you protest: "We' Re, dies für Ihren eigenen Schutz tuend."

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Let me see, does this mean we won't be able to joke near a real estate office next?  Sneaking this stuff in reminds us of the three-card Monte deals going on in CONgress in the GSE, not to mention revising away Constitutional liberties in general...

 

Hold on while I pinch myself. This is the weekend when we remember America's military who gave their ALL for this Great Country and at the same time preemptive search is being pimped around the District.  Where am I?  Do I get to wake up at some point?

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Speaking of housing, you have noticed that as the number of home foreclosures have gone up, so have the number of squatters who have moved into vacant homes.

 

This has led to police having to go to homeowner associations in places like Lawrence, MA to ask residents to keep an eye on vacant homes.

 

This leads to mental images like  (knock, knock, knock) "Open up, it's the police.  We need to see your mortgage documents..."  It's either already, or going to, happen.  I'm not sure how folks with paid for home (gulp!) would prove ownership other than going to the County records office...OMG custody till they open?

 

Say, About Those War Crimes

The World Socialist Web Site has a must-read today: "FBI files indict Bush, Cheney and Co. as war criminals". 

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Boy, what kind of website am I running here: Quoting both the John Birch Society site and the World Socialists in the same week.  Oh well, news is where we find it, I reckon.

 

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Coping: The IJTA Report

OK, with a three (or four) day weekend here, you just know the rest of this morning's column will launch into loonie zone.  Our first stop, up ahead, is the IJTA update - the Indiana Jones Technical Analysis of markets:

"Hey George,

Just thought since Landry just gave his tech prediction on the stock mkt., that I should give a quick update on my Indiana Jones Technical Analysis (IJTA). With the Jones movie release today, this will allow the IJTA to come up with the exact top for the Dow. We closed today at 12,625.62, so that means that the exact top after applying the IJTA will be 15,150.74. This should be accomplished by years end. WHOO! Glad I got that in.

For your Snip & Save section: A cure for men who snore when they lie on their backs. Its caused from their [this part deleted to maintain our PG-13 rating]  which causes them to have vapor lock. Just a small adjustment is needed by the female for a sound nights sleep.

Also a note for the reader who wrote in complaining about all your predictive ranting. Can't he find another site to read each day! Predictions welcome by me George. Heck, if there were no predictive stuff, then my IJTA would have never made it to the mainstream. I also heard that this guy once told his wife, while they were lying in bed, "I'm going to make you the happiest woman in the world". His wife then replied, " I'll miss you ".

If your still with me; some further serious observations. I can't help but match this time frame we are in right now, with the Late 70's thru the early 80's. I started driving in 1977 when gas was only 25¢ - 32¢ a gallon. Very shortly after that, gas doubled to over .50-60¢ per gal. I thought the world was coming to an end along with the rest of the towns people. Food prices were going up and my dad's price for smokes caused some arguments with my mom. After that came the interest rate hikes up to somewhere around 18%. Gold and silver took off (up about 17X for gold and 20X for silver approx.) some 2-3 years after gas prices had doubled. So if the cycles are still the same, then we should soon start seeing interest rates rising. Gold and silver, if they were to rise by the same amount as they did back then, should reach $17,000 for gold and $420 for silver, from their recent highs.

Remember this should take only 2 -3 years from now. But, I'm a little more optimistic than you, where as, I think the same thing will play out just like back then. WE GOT THRU IT !!! Prices soon leveled off and after a few years wages caught back up to cope with the rise of inflation over the past 10 years or so, middle class people started seeing daylight again, the stock mkt. started to become more attractive and the rest was history again, maybe.

Sure I see some food shortages, gas lines or rationing, earth changes and riots. But we had that all back then too. Only I think it will just be in isolated places or just short blips here and there, but we will get thru it. Except the possible death of Federal Reserve System. I think I will still be writing to you in 2013, 2014, 2015, ect. over the internet and not talking to you over ham radio.

But, seriously.  Rob the IJTA Guy's point about 1977 gasoline being (at its high) around 32¢ a gallon sends me scrambling to the Federal Reserve inflation calculator.  I put in 32-cents in 1977 and enter 2008 for my output year and tada!  Gasoline SHOULD BE $1.14 a gallon now.

 

So, either we're running out of the stuff, or the government's inflation figures are all hosed up to under-report the real impacts of price increases over time, which we all know class (tap, tap on the white board here) is really the sneaky way of saying our money is being watered down by printing too much of it!

 

Around the Ranch: Deep Ponders

Speaking of classrooms: My main consulting client (www.emachineshop.com and www.pad2pad.com ) has been invited to participate in a conference at a prestigious grad school in Cambridge, MA in July.  The company President is too busy to go - expanding facilities and so on - so I have the option to go and present. But my time and my travel. 

 

So, here I am at age 59 balancing off participation in a high end prestigious conference focusing on state of the art physical and information products for the home market against the flip side, which is having a peek into the future with the fuzzy time machine which suggests my resume may not matter much by the end of this year.

 

The ponder: help move the future along, or get ready for the one that seems to be in the wings?  Then there's the matter of the linguistic solution set that suggests travel by then might be problematic.

 

Maybe I ought to work on putting in more goat fencing...

 

Peoplenomics.com 

All the Roads to Riches

It occurred to me recently that I’ve never seen a really good survey book covering all the ways that a motivated human could get rich in this world. If such a book or short survey existed, everyone ought to be interested in studying it.  After all, who doesn’t want to be rich? So this weekend, let's see if we can't logically group the various routes to riches.  Sure, I expect the dollar to crash this coming week (or at least resume it's downward dive) but that shouldn't stop the aware person from at least keeping an eye out for opportunity.  Within every crisis there's usually a new way to get ahead of the pack by thinking in unconventional ways about conventional problems.

 

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Better Living for Less Dough

There are lots of ways to save money on food, shelter, transportation, and such.  It just takes a little reading and one source of good ideas is  our handy ebook "How to Live on $10,000 a year or less.  Still just $10.

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Last week's report is here.    For back issues of this site, click here.  (Goes back to 1997!)

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I promised Elaine that I would unload some of my equipment, so if you're looking for ham gear, especially the older tube-type (EMP resistant) type, send me a note and I will send out the list of what I'm selling off when I get it together.    Click here to  Put Me On Ham Gear List

 

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Thursday May 22, 2008

Landry's Latest

Say, here's an optimistic possibility: I've told you many times about my friend Robin Landry (email) who left the 'big city' and decided to set up shop in Shawnee, OK because for a long time, he's been like many of us who have a sense deep down in side that unsustainable economics at some point going into lock-up or breakdown mode, and he wanted to be close to real land and people when that happened.  He's also a great trader and developed a system years back using a proprietary set of indicators that seems to have done him well -- his clients made money in the 1987 debacle, for example.

 

So, when Robin sends out a letter to clients, which he's given me permission to post, it's usually better than most of the so-called 'stock-pickers' and talking heads on TV.  But, make your own judgments...see what he's saying now and then let's look in on his predictions in six months or a year and see how they've worked out:

"The market action over the past 5 months has been very difficult to count as an impulse wave.

 

Using my technical tools to confirm the count leads me to believe the rally from the January 2008 low has taken the shape of a B wave, of a larger ABC correction to complete wave 4 from the 2002 low. There are however a few indicators that suggest we may see a triangle for wave 4 with the triangle ending in Oct. and then a surge for wave 5 to form the top.

 

I believe this would then be the top so many are looking for that will then lead to the mother of all bear markets.

 

The chart I have attached shows both counts with the primary labeled in black and the alternate in red. A break of 10984 is still the level at which the larger and more bearish counts would then come into play. If the market action over the next few weeks changes my view I will post another update. As always questions and comments are welcome.

 

Robin www.landryassetmgmt.com"

The chart that Landry attached adds one important caveat:  Namely that the Dow must not break below 10,984 or all bets are of on this 'big bounce to the finish' outlook which could carry the fifth of the fifth of the fifth (in Elliott terms) into 2009.

 

As usual, this is not trading advice.  If you need some advice, take these dice and yell "Coming out!"  We may also start selling stock selector darts in our bookstore...

 

A Gassed: $12-$15

$ 135 oil this morning in the futures?  Yup.  I don't know if you happened to be watching CNBC guest Robert Hirsch yesterday, but he's been called the Dean of Oil Analysts and he's warning of $12-$15-dollar a gallon gasoline.

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One of our most astute military/strategic thinking contributors offers this after looking at other oil reports:

"Note this source predicts these prices, rapidly followed by forced rationing, in the 2010-2015 time period.

Hummm, let's see here, Chen's speech from 1 January 2007 said PLA military modernization goals were in 2007, 2010, and 2015 respectively. While multiple Russian military and government press statements have also declared their military modernization goals to be between 2006, 2010, and 2015 respectively.

Is it me or do we see a pattern here?"

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A headline in the Times Online today advises: "They're wrong about oil, by George: Rip up your textbooks, the doubling of oil prices has little to do with China's appetite."  The George they refer to is not me; it's George Soros.

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Even though gold has taken a momentary vacation from its recent assent, the black gold is still screaming upward with www.ino.com reporting that oil has climbed past the $135 mark in the futures on both a dimmer supply outlook as well as weakness in the US Dollar.

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A follow up note to yesterday's comments by petro-geologist Jeffrey Brown on how prices could accelerate:

"Let's assume, for the sake of argument, an annual net export decline rate that looks this: -2%, -4%, -6%, -8%, -10%. . .

We get a price response, followed by a demand response, and then we get a sharper decline rate, requiring an additional price/demand response--aggravated by the fact that forced energy conservation is moving up the food chain. Wherever we are headed and whatever the consequences, IMO, this is what is driving the price. A steady exponential decline rate would show up on the following (ElM, UK, Indonesia Net Export) chart as a flat line, parallel to the horizontal axis. What we see is an accelerating net export decline rate:

http://www.energybulletin.net/image/uploads/38948/image005.png  "

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I trust you saw that