Gold took a major tumble Friday afternoon, but honestly is anyone surprised? If so they shouldn't be. Many of the gold naysayers are proclaiming this was do to the increase of the dollar as it a hit a five week high. Combined with speculation that the Fed Chair is hinting at an interest rate increase and investors, as they say, have suddenly taken a liking to the dollar.
Don't count on it. This is another caffeine jolt for the dollar as the underlying factors remain for the greenback to struggle. Those that react so strongly to the Fed Chair and others in D.C. are the ones screaming for a bailout every few years. Honestly, ignore them for the most part and look around. There are no signs the debt is going down, the economy remains in neutral at best, the current administration is determined to print and spend and China is still questioning the value of the dollar.
Helicopter Bernie might offer a few quick words that bring a week long surge, but the dollars' tumble is not going away anytime soon.
Showing posts with label economy. Show all posts
Showing posts with label economy. Show all posts
Monday, December 7, 2009
Tuesday, November 17, 2009
Even Steven Day
Both gold and silver ended nearly even steven, despite a strong day from the dollar. Trading on both continues to be about inflation hedging and speculation. Demand is of course low as the economy struggles, but the shadow of inflation continues to lurk.
Combined with the struggling dollar, high US debts and inflation; investors continue to see gold and now silver as a safe move. The question is, if inflation is not seen and the economy begins an uptick, how quickly will gold and silver correct? That is as they say the million dollar question. However, with China clearly making a push against the dollar, the Obama administration which holds the spend to get out of the recession theory and the continued world turmoil, any uptick may be short lived and minor at best.
As of right now, most people recommend holding steady, buying on any form of correction and continue watching very closely.
Combined with the struggling dollar, high US debts and inflation; investors continue to see gold and now silver as a safe move. The question is, if inflation is not seen and the economy begins an uptick, how quickly will gold and silver correct? That is as they say the million dollar question. However, with China clearly making a push against the dollar, the Obama administration which holds the spend to get out of the recession theory and the continued world turmoil, any uptick may be short lived and minor at best.
As of right now, most people recommend holding steady, buying on any form of correction and continue watching very closely.
Thursday, October 22, 2009
Top Ten Signs the US Economy is in Trouble
Here are my top signs the US economy remains in trouble. These are in no particular order, just the way I wrote them.
1. White House economist Christina Romer noted the stimulus provided a jolt, but the unemployment and slowed growth is likely to return. Not a surprise and second fall, like coming down from a Mt. Dew high is likely to be worse than the original fall.
2. Unemployment continues to go up. Numbers for September showed 531,000 more people are receiving unemployment benefits. Not good, but even worse are states such as Michigan were unemployment is at 15%.
3. The State of California is as close to complete collapse as a state economy can get. Riddled by sky rocketing unemployment in the farming sector, caused by government regulation, and out of control spending, California is a disaster. Add it to Michigan and it is hard to imagine a recovering economy with two major states in economic disarray.
1. White House economist Christina Romer noted the stimulus provided a jolt, but the unemployment and slowed growth is likely to return. Not a surprise and second fall, like coming down from a Mt. Dew high is likely to be worse than the original fall.
2. Unemployment continues to go up. Numbers for September showed 531,000 more people are receiving unemployment benefits. Not good, but even worse are states such as Michigan were unemployment is at 15%.
3. The State of California is as close to complete collapse as a state economy can get. Riddled by sky rocketing unemployment in the farming sector, caused by government regulation, and out of control spending, California is a disaster. Add it to Michigan and it is hard to imagine a recovering economy with two major states in economic disarray.
Saturday, October 17, 2009
Housing Market Looking at Double Dip Hit
I am not trying to put up bad news all the time. However, it seems to me and others that some in the media are looking through rose colored glasses. Things are not good, which for many of you that is a big duh. The link is to a story focusing on some very dangerous problems. Each one has the power to send the economy back into a spiral and must be addressed by any investor.
Housing Set for Double Dip
Housing Set for Double Dip
Tuesday, October 13, 2009
Unemployment Rate to Remain High
In a report released by National Association for Business Economics, economists believe employment recovery will be slow and the unemployment rate high. They agree that most jobs will not return for three years, stalling out any real recovery.
This report from the NABE would appear to contradict recent claims of a recovery already underway. Simply put, growth means jobs and if there are no jobs can there really be growth? A more reasonable conclusion is the economy may no longer be spiraling downward, but it has yet to begin the upward climb. This is the real problem.
The perception of the general public will remain negative as the unemployment rate is the most reliant indicator for the average person. If this number remains high, the fear of them being next will remain, forcing the consumer to curb spending, tighten investing and stall the economy.
This report from the NABE would appear to contradict recent claims of a recovery already underway. Simply put, growth means jobs and if there are no jobs can there really be growth? A more reasonable conclusion is the economy may no longer be spiraling downward, but it has yet to begin the upward climb. This is the real problem.
The perception of the general public will remain negative as the unemployment rate is the most reliant indicator for the average person. If this number remains high, the fear of them being next will remain, forcing the consumer to curb spending, tighten investing and stall the economy.
Wednesday, October 7, 2009
Hyperinflation
I have serious doubts about hyperinflation, but listening to those that believe it is coming have been given some crediability with the housing disaster. The following video was produced by Inflation US. I know little about this organization, but it is the people who are seen in the video who I do know, such as Ben Bernanke. Ron Paul and many others. It is worth watching and taking into consideration what has already happened and what might be yet coming.
Thursday, October 1, 2009
Is There an Economic Recovery?
The question continues to be debated; Is there an economic recovery underway? The answer has two prevailing views. The first is no, there are little to no signs of a recovery, the national debt continues to rise, the dollar continues to plummet and there appears to be little growth in any economic segment. The opposing view is yes, there is a recovery. Job losses have stalled out, the real estate market is recovering and DOW Jones is hovering around the 10,000 mark. However, even this group of individuals agree that the recovery may be a jobless one. The unemployment reportis gloomy as once again first time claims have gone up.
So what is a jobless recovery? Basically for those that held onto their jobs, they look safe. Those that were cut, well good luck finding work that doesn't include the words welcome or do you want fries. For the latter group it will be very difficult to convince them a recovery is happening, for the former, forgive them if they hold onto a negative outlook. After all many of them are still facing wage freezes, unpaid leave and a stagnant future.
Honestly, for this individual it seems ridiculous for anyone to proclaim an economic recovery without job growth. If a large portion of society is unproductive the economy will remain at best in neutral, which is not a recovery.
So what is a jobless recovery? Basically for those that held onto their jobs, they look safe. Those that were cut, well good luck finding work that doesn't include the words welcome or do you want fries. For the latter group it will be very difficult to convince them a recovery is happening, for the former, forgive them if they hold onto a negative outlook. After all many of them are still facing wage freezes, unpaid leave and a stagnant future.
Honestly, for this individual it seems ridiculous for anyone to proclaim an economic recovery without job growth. If a large portion of society is unproductive the economy will remain at best in neutral, which is not a recovery.
Wednesday, September 16, 2009
Gold Price...Where's It Going?
If I could answer the question of where gold is going, well then I wouldn't be posting on this blog. Instead I would be sitting on the beach, with my lovely wife, sipping a Corona. However, all indications are pointing to up, up and up for gold prices.
Now here are some reasons to start buying gold.
Let's take a look at the world around us. First, the banking system remains unstable at best. The problems which hounded the financial system remain in place. No, not lack of regulations, but the continued increase of it. Barney Frank is insistent on keeping Freddi Mac and Fannie Mae alive and kicking. This in essence allows the government to continue pressuring or allowing banks to continue making the borderline loan an easy transaction. So long as these two government entities are buying up bad loans, banks will continue giving them, keeping the entire situation unstable. Secondly, as the dust continues to settle, look for the financial sector to be monopolized by a select few; aided by the government.
This is nothing more than one symptom of an infested economy. Perhaps the looming 800 pound gorilla is the policy of printing money to pay for the debt. This practice can have devastating effects on the economy, creating hyper-inflation. The theory is simple, more money dilutes the value of the dollar, pushing up the prices of goods and services at a rapid price.
The strain on the investment class or rich, is growing to a breaking point. As the policies of this nation create more and more debt, taxes must and will be raised. This will drain money from those who can create wealth and place it squarely in the hands of the government, which cannot create wealth.
Finally, America's debt is no longer an in-house debt. Folks, our debtors are foreign nations specifically, China. This has in essence created a situation where our actions must be explained, at the least, to a foreign government. This situation is self explanatory.
The foundations of the American economy are rattled and this means one thing; gold. The top investors will continue running to gold, so as common investors, follow them. I am not supporting a complete pull out of the stock market, but instead shift a percentage of investment money into gold. It is the wise and prudent action until we have clarity to the direction of the new economy.
Now here are some reasons to start buying gold.
Let's take a look at the world around us. First, the banking system remains unstable at best. The problems which hounded the financial system remain in place. No, not lack of regulations, but the continued increase of it. Barney Frank is insistent on keeping Freddi Mac and Fannie Mae alive and kicking. This in essence allows the government to continue pressuring or allowing banks to continue making the borderline loan an easy transaction. So long as these two government entities are buying up bad loans, banks will continue giving them, keeping the entire situation unstable. Secondly, as the dust continues to settle, look for the financial sector to be monopolized by a select few; aided by the government.
This is nothing more than one symptom of an infested economy. Perhaps the looming 800 pound gorilla is the policy of printing money to pay for the debt. This practice can have devastating effects on the economy, creating hyper-inflation. The theory is simple, more money dilutes the value of the dollar, pushing up the prices of goods and services at a rapid price.
The strain on the investment class or rich, is growing to a breaking point. As the policies of this nation create more and more debt, taxes must and will be raised. This will drain money from those who can create wealth and place it squarely in the hands of the government, which cannot create wealth.
Finally, America's debt is no longer an in-house debt. Folks, our debtors are foreign nations specifically, China. This has in essence created a situation where our actions must be explained, at the least, to a foreign government. This situation is self explanatory.
The foundations of the American economy are rattled and this means one thing; gold. The top investors will continue running to gold, so as common investors, follow them. I am not supporting a complete pull out of the stock market, but instead shift a percentage of investment money into gold. It is the wise and prudent action until we have clarity to the direction of the new economy.
Friday, September 4, 2009
Gold Racing to New Highs
Gold is racing towards $1000 per troy ounce an amazing early September run. Silver is matching that run going up $16 per troy ounce. Now, don't look for either to sustain these highs. However, the floor isn't going to drop out either.
Clearly investors are quickly losing, assuming they ever had it, confidence in the central banking system and the current administration. The constant talk of health care, cap and trade and now a tax on traders, is fueling this doubt and creating even greater concern about the health the dollar. Toss in the fears of a jobless recovery and what we have are jittery investors running towards gold.
So what does this mean for the common gold investor? If you are heavy in gold snag some profits, if not hold off buying. Wait for the correction which could come anytime and then jump in. The price will go back to somewhere between $950-900 mostly because the demand for gold jewelry is not there. But, as the economic troubles continue, unemployment hitting a 26-year high, gold will continue the climb upward.
Clearly investors are quickly losing, assuming they ever had it, confidence in the central banking system and the current administration. The constant talk of health care, cap and trade and now a tax on traders, is fueling this doubt and creating even greater concern about the health the dollar. Toss in the fears of a jobless recovery and what we have are jittery investors running towards gold.
So what does this mean for the common gold investor? If you are heavy in gold snag some profits, if not hold off buying. Wait for the correction which could come anytime and then jump in. The price will go back to somewhere between $950-900 mostly because the demand for gold jewelry is not there. But, as the economic troubles continue, unemployment hitting a 26-year high, gold will continue the climb upward.
Tuesday, July 14, 2009
Economic Numbers are Ugly.
The Wall Street Journal printed an op ed piece from Mortimer Zuckerman, concerning the real numbers on unemployment. Folks, looking at this article, it's ugly, really, really ugly.
The underlying numbers point towards a continued downward economic spiral. From the underpaid to part-time workers to those suffering from hour cuts, it is clear this recession is showing little signs of letting up despite two, yes, two stimulus packages from the federal government.
Businesses remain in pure retraction mood, looking for survival instead of expansion. The outlook for the near future appears to be more of the same. Even President Obama is now adjusting his statements, declaring unemployment may continue climbing.
What President Obama seems unwilling to acknowledge the stimulus package as noted by Zuckerman, has mostly been used for programs that created nothing. They have funded such things as medicaid and other social programs. Add in the money packaged to the states and what we have is a stimulus that has cost the American taxpayer billions and will eventually result in higher taxes on exactly those needed to solve the recession; the wealthy and business.
Predicting the direction of economies can make a fool of the intelligent. However, all signs are pointing towards rougher waters and that is a scary thought.
The underlying numbers point towards a continued downward economic spiral. From the underpaid to part-time workers to those suffering from hour cuts, it is clear this recession is showing little signs of letting up despite two, yes, two stimulus packages from the federal government.
Businesses remain in pure retraction mood, looking for survival instead of expansion. The outlook for the near future appears to be more of the same. Even President Obama is now adjusting his statements, declaring unemployment may continue climbing.
What President Obama seems unwilling to acknowledge the stimulus package as noted by Zuckerman, has mostly been used for programs that created nothing. They have funded such things as medicaid and other social programs. Add in the money packaged to the states and what we have is a stimulus that has cost the American taxpayer billions and will eventually result in higher taxes on exactly those needed to solve the recession; the wealthy and business.
Predicting the direction of economies can make a fool of the intelligent. However, all signs are pointing towards rougher waters and that is a scary thought.
Tuesday, June 2, 2009
China: America's New Owner
Treasury Secretary Timothy Geithner announced today that China has expressed confidence in the United States dollar. The announcement was praised as great news for the United States and it certainly is. However, think about the consequences of this statement and the fact it holds so much importance.
Geithner is in China attempting to soothe the ever growing Chinese fears about our economy. Failing to understand the possible consequences of the need for Geithner's visit is failing to understand the situation we are spiraling into in.
For those that do understand, this is yet another red, glaring warning light concerning the condition of this nation's economy. As individual investors it is becoming ever more critical to re-think our portfolios and honestly, holdings in this nation.
It is time for the common man to build up silver reserves. Silver is cheap and available. The one set back is price, which is racing upwards. But by becoming a bargain shopper, deals can be found by any potential buyer.
The prudent move is to now start looking for those deals and start turning the weak dollar into a tangible item with a tangible value.
Geithner is in China attempting to soothe the ever growing Chinese fears about our economy. Failing to understand the possible consequences of the need for Geithner's visit is failing to understand the situation we are spiraling into in.
For those that do understand, this is yet another red, glaring warning light concerning the condition of this nation's economy. As individual investors it is becoming ever more critical to re-think our portfolios and honestly, holdings in this nation.
It is time for the common man to build up silver reserves. Silver is cheap and available. The one set back is price, which is racing upwards. But by becoming a bargain shopper, deals can be found by any potential buyer.
The prudent move is to now start looking for those deals and start turning the weak dollar into a tangible item with a tangible value.
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