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 Replies: 21 / Views: 2,476 |
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Rest in Peace
United States
9104 Posts |
E-mail from http://www.moneyandmarkets.com Bolding mine. This morning, Benjamin S. Bernanke virtually guaranteed soaring gold prices and plunging stock prices as far as the eye can see. Millions expected the Fed chief to use his Jackson Hole speech this morning to announce -- or at least to hint at -- a massive new stimulus program aimed at saving the U.S. economy and stock market from impending disaster. They had every reason to hope: U.S. GDP growth is once again grinding to a virtual standstill. This morning, Washington LOWERED its measure of GDP growth for April, May and June, to just 1%. That means, the U.S. economy grew a measly 0.7% -- just seven tenths of one percent -- in the first six months of 2011. Now, with unemployment still sky-high and with home values still plunging, global investors hoped against hope that the Fed chief would use this morning's speech to pull a rabbit out of his hat. But as if to remind us that hope is no strategy, the announcement never came. There was no hint that the Fed is planning to kick the printing presses into overdrive to fight this slowdown. There was no plan of any kind designed to reinvigorate the economy or stock market. There wasn't even a strategy for combating the inflation that has taken hold of the economy and is now pushing millions of families to the brink of financial failure. Instead, we got nothing more than the same tired old platitudes: "The Federal Reserve stands ready to intervene ... blah, blah, blah." Surprisingly, Bernanke seemed to blame Congress, saying that it is now up to our elected representatives to do what's necessary to get the economy growing again. Now, with no help from the Fed for America's beleaguered financial sector -- and with inflation already beginning to accelerate -- my strategy going forward is confirmed: Look for soaring gold, silver and food prices and plunging stocks -- especially financial stocks -- both in the U.S. and in Europe as far as the eye can see! More importantly, I'm looking for the anti-banking plays and long positions on gold, silver and food I'm recommending in Master Trader to shoot for the moon! Best wishes, Kevin Kerr About Money and Markets For more information and archived issues, visit http://www.moneyandmarkets.com |
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New Member
United States
46 Posts |
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Rest in Peace
 United States
9104 Posts |
Firing the guy who lowered the US rating about a third as far as he should have was the first transparent thing OBama's administration has ever done.
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Pillar of the Community
United States
830 Posts |
nm....I'll just edit this to say there are ways of making money in a down market.
Edited by GoThunder
08/27/2011 8:44 pm
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Pillar of the Community
United States
4008 Posts |
Hey, Thunder... that stuff sounds a lot like derivatives. Ack! Pfft!  |
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Valued Member
United States
302 Posts |
They are derivatives.
But I have a problem with his Sept puts. They will expire before the most critical economic period of the year, late October. Not saying he will need puts then, but if he likes the insurance puts provide, I would think puts expiring on or after the end of October are historically more useful than Sept puts.
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Pillar of the Community
United States
830 Posts |
I could buy farther out but it costs more, I'd rather see how things are looking when we get closer to Oct before buying for that far out. For now I'm trading these options, sometimes making 200-300% in a week or 2, sometimes losing 100% but having the downside protection at the same time. I'll probably be doing a straddle on GLD for Oct.
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Pillar of the Community
United States
830 Posts |
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Valued Member
United States
244 Posts |
Quote:
Surprisingly, Bernanke seemed to blame Congress, saying that it is now up to our elected representatives to do what's necessary to get the economy growing again. Why surprisingly? This is something that Dallas Fed president Richard Fisher has been talking about for some time now. The notion that the Fed can magically create prosperity through monetary policy, despite the president and congress doing their utmost to slow the economy is ridiculous. Just look at Japan. They've had an easy-money policy for 20 years (while pursuing one misguided "stimulus" after the next). Have they gotten prosperity? No, they merely created a lucrative "carry trade" where people could borrow cheaply domestically and invest overseas. We're now doing the same. If Washington would learn (that is, if we voters would compel them to), we could get both growth and currency stability that would cause the stock market to rise, and the gold price to fall. As a final comment, since when is it the Fed's job to guarantee stock market investors profits? That's how you get bubbles and their subsequent crashes. |
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Pillar of the Community
United States
4008 Posts |
Quote:
As a final comment, since when is it the Fed's job to guarantee stock market investors profits? That's how you get bubbles and their subsequent crashes. Good points. It is NOT the Fed's job to guarantee anyone's profits. IMHO, the Fed has been the creator of or a large contributor to all of the bubbles in recent history... Internet stocks, housing, banking, etc. The Fed needs to "man up" one of these days and admit that their policies have been misguided and have caused much more trouble than they have solved. That's extremely unlikely but it would be an excellent 1st step in healing our economy. |
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Pillar of the Community
United States
1228 Posts |
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Now, with unemployment still sky-high and with home values still plunging, global investors hoped against hope that the Fed chief would use this morning's speech to pull a rabbit out of his hat.
I know a guy that got a low variable rate loan to lower his monthly payments and restablish his bad credit but when he went to refi that loan do to the rate/payments going up there was less value in the home than before to be able to refi so he taped into his assets checking/savings accounts stocks bonds retirement funds etc for home improvements to get the homes value back up so he wouldnt have to come in with closing costs that he didnt have at the time for the new refi but before he started the home improvements pool,deck new roof copper piping new double pain windows granite kitchen counter tops and a room addition etc he took the current balance and divided it by the present conservative value and he said as long as it wasnt over 85% then he would qualify for the new refi and it worked he was verry happy about the decision that he had made He avoided 10 years bad credit witch is the worst derogatory one could have,It's worse than a bankruptcy at 7 years bad credit If homes are under water/upsidedown on there mtg then get some home improvements done to bring back up the value
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Pillar of the Community
United States
3294 Posts |
Most home improvements raise the value by less then the $$$ you spent to do the improvement unless you are very skilled at carpentry and can do your own electrical and wiring. You would be better off using the cash to pay down the existing loan.
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Pillar of the Community
United States
1228 Posts |
Great point Nod2003  |
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Pillar of the Community
United States
1590 Posts |
I think it could be argued that QE1 and 2 caused inflation. They certainly devalued the dollar. And it seems that instead of taking the money and reinvesting in America the Banks and other institutions either added to their Reserves; invested overseas; or invested in Commodities. The last having the net effect of raising commodity prices. And since when have higher prices for food and energy been a good thing for this economy? No for ONCE I have to agree with the Fed. I also see where they have gone away from the Partial Employment model, which led to this Recession and are now backing the Pre-1980 Full Employment model. Yes, it did create wealth...for the wealthy. Corporate earnings are through the roof. Salaries for Upper Management have increased 10 fold. But at the price of destroying the dollar, the American Middle class, and the American Economy. And Corporate America simply does not care. As long as their profits are up ( and they are) then they could care less about anyone else.
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Pillar of the Community
United States
1228 Posts |
He had a huge two story home so he purchased two energy efficient central air units one for when he was upstairs and one for when he was down stairs so that he didnt have to heat or cool the whole house he said that it already paid for itself !
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Pillar of the Community
United States
667 Posts |
I'm never understanding this hate Corporate America thing. When people say that I want to run as far away form them as I can get. I figure they don't have a clue how to succeed and I don't want it to rub off on me. Look the simple fact is Corporate America has been pretty good to me. Now I had to work to get a part of the pie, and it was darn hard work. Farm prices go and and down faster the PM's do.
But without Corporate America I don't pay my bills. I could care less how much they make, I just make sure I get what I want and they make more then well they negotiate better than me.
My house is old built in 1846. It has had some additions and updates since then. Last fall we had to do a few things so I had to have it appraised again. I was concerned with all the was going on last year. This was the first time they wanted an appraisal in 9 years too.
I fell off the chair when it came back $125,000 more than the last time. No big addition or improvement in those 9 years either.
There are a lot of angry and mad people lately. The blame everyone but I was always taught to take care of yourself and figure things out when times where bad. We have done ok and the PM's have done really great. I remember those that told me it would never build wealth. Those small investments of dollars over time really paid off.
My point is stop blaming everyone and figure it out for yourself. If a person has more money congratulate them and if you want the same then figure out how to do it.
I compete with large cooperate farms, we had to make changes and figure it out.
I look at the current economy as a opportunity. I'm just not waiting for someone else to figure out what that opportunity is for me.
My long term strategy in PMs have paid off big time. It gave me the flexibility to make some moves which I did. It sure beats crying about Corporate America. I made the sacrifices when I was young, figured things out and to be honest I don't even notice a change in the economy.
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Replies: 21 / Views: 2,476 |
Posted 08/27/2011 09:03 am
