Thursday, April 29, 2010

An Opportunity in the Making?

Any hard asset investor can hardly call themselves such if they don't have at least one oil stock in their portfolio (this, despite the fact it's gooey, slippery, and definitely not hard).  I recommended some oil companies in late 2008 and early 2009 which were extremely profitable.

However I am looking at another potential setup in the fairly near future (anywhere from a few weeks to several months).  Something to keep in mind, anyway.

The sentiment towards oil itself has been gaining strength, with speculators holding a huge number of open long contracts the past several months - the past few weeks have been holding steady at well over 110,000 open long contracts.



While looking at only the number of open contracts aside from anything else is not a great idea for trading oil, it is a nice piece of data to show where overall sentiment is sitting.  As of right now, it's pretty elevated - I'm not saying we won't see another surge up in oil, but upside in the immediate future should be fairly limited.

The particular stock I'm looking at isn't an obscure name by any means (they are the biggest in their industry), and they have been tossed around for years now by major publications.  That being said, most of these guys were recommending the stock before it took a 75% hair cut along with the market.  It is still under 50% of what it was at the oil peak in 2008.

The company is on the higher end of fairly-valued right now, but fairly valued nonetheless.  As of today, it trades at under 9x Price/Earnings, 1.33 Times its Book Value, and 2.36 x Gross Revenue.

Cash-flow is fairly strong, with a 4x net interest coverage on all outstanding debt from free cash.  The company has retired a large chunk of its debt over the past 2 years (over $5 Billion), and seen 2 years of revenues above $10 Billion (from $2.8B, $3.9B, and $6.4B in 2005, 2006, and 2007, respectively.).

All in all, revenues are up, the cash position is strong, assets are generating tons of cash, and demand for the product they offer is growing steadily with growth potential reaching far out into the future.

The company is one I'm sure you've heard of before.  Transocean (RIG on the NYSE), headquartered in Switzerland (for tax purposes), and with the largest fleet of underwater drilling ships on the planet. 

This is not an easily entered industry - It is extremely capital-intensive ($500 + Million to build a drilling ship), which offers an excellent natural barrier to entry against a wave of new entrants/competitors.  Furthermore, the type of clients that Transocean deals with aren't fly-by-nighters or small-time companies where taking their business may be a bet on receiving payment.  Transocean's customers include Chevron, Exxon, and many of the other big players exploring and tapping underwater reserves - Most of these guys have stockpiled tons of cash over the years and are hungry for new projects to keep revenues up as older project output dwindles.

From the technical side, it doesn't look like the stock has a high-potential for further upside in the immediate future.  As far as sentiment tops go, the recent major push by the Obama administration encouraging underwater drilling is a re-enforcing signal of an interim top in positive psychology.  As sad as it is to say, the oil spill in the gulf of Mexico is as fitting an occurrence as could be in the wake of that sentiment (remember, the State is always a late-comer).



This should provide a mid-term negative backdrop for the stock to settle into a more opportune price-level and make a great addition to a long-term core portfolio.



I'll keep you updated on this pick and let you know when I'm going to scoop up some shares.  At this point, the stock looks to be building for a major move with downside potential being far greater.  That being said, key resistance is at $93.25/share, and a daily close above that mark would indicate a major bullish breakout potential in the immediate future.

Have a great weekend everybody!  As always, if you have any questions or comments you'd like to send me directly instead of posting on the blog, I can be reached at derek@investophoria.com

Derek.

91 comments:

  1. Derek,
    I don't want to rain on your plans, but seems very quite here. Is it plausible that gold investors are becoming wise and refusing to speculate?

    My dream would be for multitudes of investors to take gold with strong hands, and give TPTB and their growing socialism the middle finger. If only 0.01% of world's capital did this, the EU and China would be toast. I realize it probably won't happen, but it is interesting to me the lack of interest in this speculation topic.

    -Shelby

    ReplyDelete
  2. Derek,

    How is the new website coming. I'm eager to sign up.

    Thanks again for this blog,

    Kiley Kuhl
    Wisconsin USA

    ReplyDelete
  3. It's probably quiet because this entire page has been taken over by two nutjobs, one secular and one religious, who apparently have nothing at ALL to do in life, besides write endless....rambling diatribes. Derek's stuff is interesting, but the comment area is now strictly for the masochists. It got old a long time ago.

    ReplyDelete
  4. The website is coming along well, we are just working out which merchant company is the best to use for our services.

    As to the comments - I will be posting an ongoing FAQ on the website if customers email in something interesting, but unrestricted ramblings will no longer be available (this in the spirit of preventing early onset of carpal tunnel in some of the more enthusiastic participants).

    Derek

    ReplyDelete
  5. The Loser cannot take the heat of being wrong. Elliot wave is dead. Flip-Flop

    "As to the comments - I will be posting an ongoing FAQ on the website if customers email in something interesting, but unrestricted ramblings will no longer be available (this in the spirit of preventing early onset of carpal tunnel in some of the more enthusiastic participants)."

    ReplyDelete
  6. "have nothing at ALL to do in life":

    How would you combine contact.com and King Kong?

    You will eat your words once you solve that obvious riddle.

    -Shelby

    ReplyDelete
  7. Derek, after 25 years of programming 16 x 7, carpal has not been a problem. And in the time it has taken you to develop and launch your site, I was not only writing volumes in your blog, but also developing what I hope to be a major social networking site.

    I have no problem with you shutting off public comments. You are smart guy apparently, but I think the choice of profession is pretty sketchy. What do you produce? You get people to gamble? Nice.

    I hate religion. I try to find those unavoidable mathematical truths (many of which happen to be articulated in the Bible, quite unexpectedly since I was agnostic). And one such truth is that gamblers always lose it all eventually.

    -Shelby

    ReplyDelete
  8. To the anonymous person who is too afraid to put his name, please define "nutjob":

    http://dictionary.reference.com/browse/nutjob

    Impressive the logic of someone who uses words that have no meaning. You can dish it out, but can you take it? Maybe I need to speak in your vocabulary for you to understand "dickwad".

    -Shelby

    ReplyDelete
  9. There is a subtle difference between the verbs 'to gamble, and 'to speculate', but there is a difference.

    One could say that the whole point of this type of website is to try to help avoid the emphasis on 'gamble' and shift it to 'speculate'

    Gambling relies wholly on the chance, or luck, element.

    Speculate (in finance) means risk based on well reasoned analysis of pertinent information allied to a thorough understanding of the particular market concerned.

    It is true that most people, that means the masses who participate in the markets. are gamblers because they are not prepared to do what 'speculation' requires; or they confuse themselves with too much information without the ability to sift the wheat from the chaff

    Some do make a very good living as 'speculators' because they treat it as a business. Unfortunately, human weakness sometimes makes them forget 'the rules' and 'gamble' then, like one of the all time greats who is not alone, - lose all they made.

    There is a very powerful moral there. Observe it, and learn from it.

    Never get over confident in anything you do that is bringing you success, that you forget 'the discipline' of the method which is providing that success.

    Easier said than done. But why?

    ReplyDelete
  10. About gambling vs speculation, there is no mathematical distinction in these paper markets. And the inability to know this, is what suckers in many sheep for the slaughter by Wall street.

    I will attempt to explain to you mathematically why any one who bets on Wall Street, is a loser in the long-run to the casino house.

    In Las Vegas, the variables of a card game are deterministic (they were before they moved to multiple decks, shuffling the cards before each hand, etc), and if you were smart enough to count all the cards, then you were banned from the casino. Ditto on Wall street, if you are somehow able to count the probabilities, then you will be defeated in some other way (e.g. a planned take down at some point). But more salient, it is nearly impossible for you to count the probabilities in these markets, because the world is a very complex and random house.

    There are those who think they have a formula, and they consistently are making say 20 - 40% per annum gains at this time. The problem with that is that the fiat is being debased at about the same rate, so they are not getting ahead. And worse, when the moment of truth comes, they won't be holding physical gold, and they will lose everything by decree, as will everyone else invested in the paper casino.

    No I am sorry, nature will not reward you for the production of speculating on paper. And if we had time to do a thorough research paper on this, I could prove this to you mathematically.

    You are chasing folklore, just as the banksters want you to do. You do not understand what Buffet knows, which is only income from production and compounding, will truely amass wealth. He started as a newspaper boy and he does not invest in speculations. Unfortunately most are not smart enough to understand this.

    -Shelby

    ReplyDelete
  11. "Ditto on Wall street, if you are somehow able to count the probabilities, then you will be defeated in some other way (e.g. a planned take down at some point)."

    Martin Armstrong?

    -Shelby

    ReplyDelete
  12. Sorry for triple post, I do care about the gold bugs, and I urge them to study and think about the Gambler's Fallacy:

    http://goldwetrust.up-with.com/economics-f4/stocks-vs-precious-metals-vs-bonds-vs-real-estate-t11-15.htm#2967

    And to consider what I wrote above. All the traders are capturing mathematically over the long-run is the debasement of the fiat. You do not earn real money (gold), by speculating in the paper casino (over the long-run, you might have a good year, then a bad year). If you can find one speculator with a consistent return above the true monetary inflation over many decades, then I will eat my words. I am not referring to speculations on real estate and hard assets (e.g. Doug Casey), those are investments. For example, if I can buy prime land near a city of 2 million people in Asia for $500 per acre, then that is not gambling. It is a fact of nature, that the land values much go up here.

    -Shelby

    ReplyDelete
  13. However if someone was buying copper right now, I would call that gambling, because it is dependent on China's bubble continuing. What I meant to write, is that buying highly undervalued tangible assets for the long-term holding, is not a speculation. Silver would be a prime example. But you must have a long-term view. Ditto gold. Ditto land in an overpopulated asian country that does not yet allow foreigners to buy land (if you are wise enough as to how to lock up this land).

    -Shelby

    ReplyDelete
  14. $5 trillion a year in accrual deficits in a $14 trillion economy, is proof enough that monetary inflation is running north of 33%:

    http://goldwetrust.up-with.com/economics-f4/inflation-or-deflation-t9-360.htm#2983

    ReplyDelete
  15. Hi Shelby..
    Interesting to read your stuff. I want to be more into gold, I have coldcoins/silvercoins and I look to buy som stocks. Is there any stocks you would recommend? And what do you think about major producers like Goldcorp vs. juniors? Some of the juniors HAVE gone up a lot while large producers SEEM more cheap..what do you think?

    I have waited to buy because a supposed crash in the stockmarket- like Derek and many others belive WILL come- was said to bring down gold at first too, it HAS NOT MATERIALIZED , however I still think a crash in the general stock market will occurr and is concerned that goldstocks might suffer too for a while. BEFORE going to the moon..

    Keep accumulating coins though...

    Chris from Oslo, Norway.

    ReplyDelete
  16. Hi Chris from Norway (probably aka as Shelby)

    If you had really read Shelby's post, particularly to have become so enthralled with his self claimed wisdom which obviously you haven't, you would see that he could not possibly recommend any stock as he makes it perfectly clear it would be a gamble you could not win - as with 'find the lady'.skim game. (That is the game where even if you pick the correct face down card, and no matter how slowly they do it, they can flip the card at the last split second

    This is why it sounds as though this is Shelby's way of faking a post in order to make us feel he has a following, and also to have an opportunity to reinforce his message.

    Telling you that it is foolish to put your money in Wall Street, was what he is saying. Therefore, why would you ask him to recommend a stock?

    My advice is, if you are not Shelby (aka) then learn to read. If you are Shelby (highly likely) then think before you to try to fool people.

    ReplyDelete
  17. If gold goes to the moon gold stocks will go to Pluto? :-)

    Chris, Norway
    PS :I personally do not believe (maybe I will get there..) yet that gold will go there, but I DO think that goldstocks will get there because the REAL value of gold has NOWHERE to go but UP. That is gold priced to everything else. I have waited for the markets to crash and hoped that it would also be hard for goldstocks, but I might now actually believe that the crash might NOT drag down goldstocks AT ALL, but that they might decouple immediately and go to ..Pluto?

    Shelby does not like goldstocks? Okey, lets hear from him. As far as the typical deflationsits are concerned I am FED UP their goldberishness. I bought a LOT of gold stocks back in January 2009, and sold them - with a good profit - last summer because i listened to the Prechter camp. I would be VERY WELL off if I had kept those stocks. The stocks I buy now I will keep for YEARS - 3-5 MINIMUM.

    ReplyDelete
  18. It is not that I want to talk about myself, ut I know people get curious when someone such as I has written so much. I am not Chris. Afaik consciously, I have no need to try to manipulate anyone to pump up my ego. I am sure I do manipulate people subconsciously at times, as we all do (but I try to avoid such situations). What probably caused me to post more in Derek's blog, was the great intellectual challenge from Ray. Ray helped me refine my thought process, as all good debates will. I appreciate Ray. (Btw, I have posted some addition evidence on that debate at the end of the prior blog "A Minor Top Is Nigh"). It is purely selfish, with a component of sharing. Also I was drawn to Derek, for the same reason others expressed already, also agree he is "good eye candy" (if that photo is really him), even I am not female nor gay. If I were advising Derek, I would say he has the talent to become a rock star, he is drawing very interesting commentary to his blogs, and this is giving him visitors. He could monetize this and leverage this contribution from others. Why kill when other people are writing monetize-able content for you? So I guess I felt a bit drawn to him as a mentor, but simultaneously with a degree of respect as a peer. I like experimentation, I dip my toes in things to keep myself in touch with the public, and maybe it is waste of time, but it is the way I keep myself from going crazy isolated in a programming cave for decades. I do have a normal life as well when I get off the computer, similar to Derek enjoying getting out into nature, and I also enjoy very much socializing and have many friends. I love an intellectual debate and stimulation. I like when someone can show me how I am wrong. I want to learn.

    Lately I am really adamantly opposed to any form of government control. Freedom has become very important to me. I guess it is an allergic reaction to all the crouch searching at airports, etc. I started to get suspicious when we went into Afghanistan, and when we went into Iraq, it all started to click and then (as an engineer) studying some physical facts of the WTC collapse, etc.. This opened my formerly naive mind to flood of information as to how the world really works. From about 2005 to 2009 was a complete transformation about my views on the world, economics, universal theory (entropy), and even on the Bible. I was actually late to buy gold (2005), although I had considered it in 2001, for entirely different reason (but didn't do it because was too busy). I was not a great investor (had not put any time into learning about it) before 2005. I was producing as a computer programmer and with some ability to manage/lead projects.

    I have had an open mind to the deflationalists, but recent debates and thinking has firmly cemented in my mind that "Deflation is Inflation" (any short-term gyrations notwithstanding):

    http://www.marketoracle.co.uk/Article16212.html
    http://goldwetrust.up-with.com/economics-f4/inflation-or-deflation-t9-360.htm#2983

    I am sure some people will make money on precious metal stocks. The people who make the most will be the brokers, insiders, and promoters. And some small investors will get lucky with their timing too. But as for a long-term hold that will certainly outperform gold and silver, I want to stress that this massive shakeup of the world economy, is going to be more about "preserving capital". It will difficult enough just trying to preserve capital, because the govts are going to be forced to find a way to tax (confiscate) everything...

    (...continued on next post...)

    ReplyDelete
  19. (...continued from prior post...)

    Physical metal sales will probably also be taxed (if you report them and very risky if you don't report them especially if you are citizen of western country), and if you read my link above, it is not farfetched for capital gains taxes to rise to 90% as they apparently were in USA during a portion of the last Great Depression. So you could lose 90% of your gold to the govt with a tax form of confiscation. You won't have many voters in your predicament, willing to help you fight the govt on this, because perhaps only 1 in 100,000 (or less) people in world own precious metals for investment?

    (...continued on next post...)

    One risk is that the western financial system is going to become a cancer on itself. Thus I see the real risk that the govts confiscate everything they can get their hands on. So wouldn't electronic stocks at brokerages (under the control of the SEC) be very easy to "regulate"?

    You see if gold goes to the moon, then society goes into hell. An important dichotomy that I think people are not factoring into their thought process.

    Also the boomers are going to be running away from stocks. They will be selling all the way down (down in TRUE inflation adjusted terms, see my link above for true inflation running 33+% now), to fund their expenses, as they are bankrupt.

    For as long as the financial system and global economy is functioning, and as long as oil and price inflation is not increasing faster than gold price, then mining stocks can outperform. But you've got other factors such as their higher beta (volatility), and their individual shenanigans and issues (unless you hold an index of them). But physical silver metal could outperform these gold stocks and does not have the risks (if you hold long-term). And silver stocks are really a joke (and it shows in their high beta and shenanigans of the insiders), because the metal is priced way too low right now:

    http://silverstockreport.com/2009/Phoenix-promo.html (miners have less gold per share)
    (I can't find the other link where he wrote recently how silver miners should be doing nothing but acquiring ounces in the ground and waiting for higher silver prices, instead of diluting the shareholders)

    I should know because I programmed and helped populate Miningpedia.com (with Jason Hommel of SilverStockReport.com) and was duped by the insiders of various junior mining companies. I shut that site down. Hommel stopped promoting stocks too. Maybe we overreacted, but consider my logic.

    If you bought palladium at the bottom in 2008, then you did as well as any grab bag of mining stocks. Nearly ditto for silver metal.

    Why risk it? Is that a "get rich quick emotion" that will cause you to ignore some real risks? My logic may seem very foolish for a while, but when the point comes where you either have metal or you have nothing, that is when people will wish they had considered all the risks.

    -Shelby

    ReplyDelete
  20. I had written previously about mining stocks:

    http://goldwetrust.up-with.com/stocks-f2/junior-mining-companies-t15-15.htm#2888
    (follow all the links on the post as well)

    -Shelby

    ReplyDelete
  21. Your question about mining stocks, caused me to have an epipheny!

    With China's stimulost (another $586 billion coming) running at 12+% of GDP, they have been misallocating capital to overconsume natural resources (beyond what is sustainable and best opportunity cost, due to centralized decision making), and this has sustained mining of the base metals, which produces nearly all of the silver in the world as by product.

    Is it possible that this is part of TPTB's plan to delay the "moment of truth" on silver? Misallocate world resources to overproduction of silver, without increasing the silver price, by overincreasing the copper price!

    The world is going to crash into a hell. The govts are spending insanely. Buy physical gold and silver while you still can. And then sit tight and keep buying if you can generate income.

    -Shelby

    ReplyDelete
  22. if you are visiting here due to the Kitco link and starting to believe any of Blain's crap or any of the other nutjobs who are spewing their crap in return, i'm here today to tell you that you are a fool, and you know what they say about a fool and his money...run from this guy, he's a liar and a con man

    ReplyDelete
  23. Derek,

    Garynorth.com apparently makes a lot of money (huge long term subscriber base) writing general economic and political commentary (and monetizing user feedback in forums). He has a long-time alliance with Ron Paul and LewRockwell.com

    That is how you make an online business profitable and sustainable.

    Best of luck to you and I hope I have helped more than I have disrupted.

    -Shelby

    ReplyDelete
  24. One more thing about how the dollar is being propped up (eventually to crash relative to metals, but we could get dollar rally first), that expands on my theory above that global stimulost keeps the production of base metals up and thus delays a global monetary default in silver:

    http://www.gold-eagle.com/editorials_08/baltin050110.html

    "So why has "It" not happened yet? Would you believe, it's been the explosion of credit Derivatives exceeding $1.4 quadrillion that has so far prevented it. But alas, that too is a GIANT BUBBLE just awaiting a rise in interest rates (which may have already begun) that will Prick that Bubble and bring the whole house of cards tumbling down. So while the back door machinations covers $ trillions of leveraged losses, the fires will soon be treated with an accelerant, as both the US and UK Governments succumb to pressures and announce the second phase of QE: That will trigger the inflation that they think is so necessary, all the while vigorously denying the possibility of the hyper-inflation that will surely follow."

    -Shelby

    ReplyDelete
  25. Ah and here is further circumstantial (not cause & effect coupled) evidence of my theory (no silver by product from aluminum mining):

    http://www.gold-eagle.com/editorials_08/baltin050110.html

    "THE CANARY IN THE MINE: Was Alcoa earnings announcement acting like the proverbial canary in the mine shaft; warning us about the real state of the economy? How can the economies be picking up the kind of steam that the politicians and one way analysts are calling for without the participation of such a basic raw material as Aluminum?"

    -Shelby

    ReplyDelete
  26. While we have all been wasting our time on this nonsense trading, the USA has enacted capital controls:

    http://goldwetrust.up-with.com/economics-f4/changing-world-order-t32-75.htm#2990

    The door is closing folks.

    Make a beeline to gold and silver. If you want any money outside the USA, do it now! Get your money out of the stock market now! Get your money out of illiquid real estate and other illiquid assets immediately (even at a loss), unless you are sure they are undervalued and plan to hold for as long as is necessary.

    -Shelby

    ReplyDelete
  27. Steel prices rising daily in Asia!

    Real time personal report from Asia:

    http://goldwetrust.up-with.com/economics-f4/inflation-or-deflation-t9-360.htm#2992

    ReplyDelete
  28. The deflation/inflation debate is key to deciding any investment strategy. Arguing for one or the other on an anecdotal or merely empirical basis is not a reliable method. I suggest that the Austrian School - like von Mises - offer the right theoretical approach. But in terms of what is happening out there in the global economy, surely we need specific analyses of different economies as well as the impact of their dynamic interactions. For example, there has been dramatic deflation in US real estate due to contraction of consumer acess to credit. At the same time, there has been a bear market recovery in US stocks due to rising institutional liquidity caused by QE. There has been a boom in demand for metals such as copper and palladium due to demand from China (inflation), just as the Shanghai real estate market looks like it is about to implode (impendning deflation) as lenders withdraw credit.

    ReplyDelete
  29. Deflation/inflation continued:......so the tendencies driving deflation are more prominent currently in the US economy which has overdosed on credit and is now suffering the impacts of massive deleveraging; a process which produced the stock market collapse of 2008 to March 2009, and which will most probably continue into a new phase of stocks deflation and sovereign wealth defaults some time later this year.
    Andrew

    ReplyDelete
  30. The way gold stays where it is and silver plumets 57 cents as of RIGHT NOW makes me think that Derek could be right in his projections for silver going way down to like $8.. It is interesting how silver is down that much while gold is NOT, huh? Guess silver acts as an indistrial metal more than gold and its "safe haven" perhaps?
    Chris, Norway

    ReplyDelete
  31. You are going to hear lots more negative news about the Euro and the EU. Lots more.

    It will convey the feeling that the whole show is about to collapse, and those who wish it, and have forecasted this, will have a field day.

    Most of you will fall for it, because the media is controlled by highly professional mind manipulators. That is FACT!

    But NOTHING could be further from the truth re the Euro and the EU - and that is a FACT!

    The dollar and the Euro will, eventually, settle, as intended to around parity with the dollar, and I have bought dollars (been buying for some time) because I know this. The pound will soon dip against the dollar and, eventually, the Euro over the months ahead.

    The Yuan (which literally means 'round') is also known as 'Renminby' (literal meaning - 'peoples' currency. Ren, in Chinese means people, 'ren ren' means 'everyone'. See, Chinese is not so difficult is it) will be revalued.
    When this happens, it could hit the shares of such as Walmarts as they will be paying more for their goods.

    Of course, if the dollar is rising in exchange value, it depends on the ratio, and inflation rate.

    If the dollar overshoots the Euro, which is possible for a time. I will buy Euros.

    The not so hidden message here is that the markets, all of them, are going to be very turbulent over the coming months as 'the players' (the novice and the professionals) try to out guess, and adjust to what is really the course of events from that which is perceived.

    Deception is the name of the game. But then it has to be. Markets can never have everyone jumping on the wagon going in the same direction at the same time - especially if they have all figured out the right direction, can they.

    The phrase - 'May you live in interesting times' (often attributed to the Chinese, but not proven) was said to have been a curse. Are we than 'cursed' to be living in such interesting times?

    It is how WE each use this time, or any, which determines whether it is, for us, a positive, or a negative.
    May the force be with you.

    ReplyDelete
  32. You are going to hear lots more negative news about the Euro and the EU.
    It will convey the feeling that the whole show is about to collapse, and those who wish it, and have forecasted this will have a field day.

    Most of you will fall for it, because the media is controlled by highly professional mind manipulators. That is FACT!

    But NOTHING could be further from the truth re the Euro and the EU - and that is a FACT!

    The dollar and the Euro will, eventually, settle, as intended to around parity with the dollar and I have bought dollars (been buying for some time) because I know this. The pound will slump against the dollar and, eventually, the Euro over the months ahead.

    The Yuan (which literally means 'round') is also known as 'Renminby' (literal meaning - 'peoples' currency. Ren, in Chinese means people, 'ren ren' means 'everyone'. See, Chinese is not so difficult is it) will be revalued.
    When this happens, it could hit the shares of such as Walmarts as they will be paying more for their goods.

    Of course, if the dollar is rising in exchange value, it depends on the ratio, and inflation rate.

    If the dollar overshoots the Euro, I will buy Euro.

    The not so hidden message here is that the markets, all of them, are going to be very turbulent over the coming months as 'the players' (the novice and the professionals) try to out guess, and adjust to what is really the course of events from that which is perceived.

    Deception is the name of the game. But then it has to be. Markets can never have everyone jumping on the wagon going in the same direction at the same time - especially if they have all figured out the right direction, can they.

    The phrase - 'May you live in interesting times' (often attributed to the Chinese, but not proven) was said to have been a curse. Are we than 'cursed' to be living in such interesting times?

    It is how WE each use this time, or any, which determines whether it is, for us, a positive, or a negative.
    May the force be with you..

    ReplyDelete
  33. HOW I KNOW for CERTAIN it is INFLATION
    that is coming.

    Perhaps some will suffer the hyper variety.

    On what is that prognosis based? On the early warning signs.

    First, there is the one I have mentioned before. They are still spending advertising millions to get me to part with my gold.

    Second, I have observed an increase in the number of 'antique' and collectors shops opening, and becoming more active.

    Third. Yesterday, a record price was paid for a painting by Picasso - $106.5 million in NY. (Personally, to me it was load of rubbish, a child could better)

    Forth. Today there was a very costly TV ad similar to the 'we want your gold ads' wanting to buy our watches (Ones with good names).

    Fifth. TV advertising - 'We want to buy your car for cash. Don't trade it in, sell it to us for cash..'

    If that is not 'Inflation is coming' what is it?

    ReplyDelete
  34. Sorry about the double post but it was not intended. One did not appear for about an hour after it was posted.

    ReplyDelete
  35. Inflation is the quotient of non-productive to productive
    ===============================================

    Here follows a shocking, epiphanic equation for "Inflation versus Deflation" from the author (myself) of "How Deflation is Inflation":

    http://www.marketoracle.co.uk/Article16212.html

    Assets become way over priced when people are allowed to borrow 30 years of income, or recently an infinite # of years of income (subprime, liar loans). The lack of land titles and debt-financing is often why real estate is still so cheap in rural developing world. I expect this will change in a NWO.

    The deflation in the price of saturated credit based assets (e.g. real estate) is not the primary phenomena, and this is the key mistake of the deflationalists (e.g. Mish's credit money supply equation).

    The near-term measure of the money supply, credit, and velocity of money are meaningless noise. What really matters is the ratio of the productive to non-productive sectors (population). The lower the ratio, then the higher the inflation in future. This may be the first time any one has pointed this out, I dunno. Why is this so? Because less production means higher prices.

    That is why I have recently written that we should be looking at the accrual deficits in USA, which are running $5 trillion or 33+% of the GDP:

    http://goldwetrust.up-with.com/economics-f4/inflation-or-deflation-t9-360.htm#2983

    This means future inflation is being accrued at 33+% per annum acceleration, as the non-productive expands relative to the productive (the public sector is displacing the private sector).

    And I have written about my well-founded theory, that this shift is due to the massive unemployment resulting from extreme automation at the twilight of the Industrial Revolution:

    http://goldwetrust.up-with.com/technology-f8/computers-t112-45.htm#2984

    -Shelby

    ReplyDelete
  36. Agriculture did not die with the Industrial revolution. We cannot live without agriculture.

    Agrarian society which lasted thousands of years had stages of development before, and since, the Industrial age appeared.

    There are stages of development of the Industrial which started with the 'smoke stack' period (which even China is eliminating).

    Technology has been part of the industrial age since the beginning. In fact, it could not have developed had not technology, which includes communication, not made it possible.

    It is true that all forms of employment are reducing their need of labour. This is, and will continue to be, the greatest problem facing society.

    I believe labour could be reduced even more dramatically, quicker, but the establishment has kept this down knowing the social unrest this will bring.

    I could put forward a strong political argument as to the options, and how this will be most likely resolved, but the place is not here.

    All we need to know here is that this will influence markets, and economies, increasingly now and over the years ahead.

    Derek, and others here, may want to silence voices that raise these influences and concerns, and I accept he has that right, but that will only indicate a severe short sightedness of market outlook.

    The byword 'Change' is echoing around the world as though it is a cure all. There is, and always has been, constant change, it never stops. Change is good for some, and bad for others, it certainly is not synonymous with 'cure' from everyone's perspective.

    One man's meat, is another man's poison

    ReplyDelete
  37. When I say "twilight of Industrial Revolution", I mean (just as when the Agricultural revolution ended and Industrial Revolution began), that in near future most people will not gain meaningful employment (renumeration) from manufacturing. China was handed a rotting/decadent paradigm to drive their economy into a bubble just as their boomer bubble will peak by 2020 and massive demographic decline coming in China.

    Ever moving change is simply the 1856 Law of Thermo, which states that disorder (entropy) of the universe is always trending to maximum. Nature (universe) is always trying to break down matter into more granular actors (i.e. more possibilities).

    Thus the next revolution for employment is in the software or the design of things that are physically manufactured (and/or digitally copied). Many more possibilities. The future is one where I can have the exact thing I want, not 1 or 1 million copies shared by 1 million others. I want running shoes in a certain design, color, heel height, thicker insole, gel insole, etc.. There will still be the economy-of-scale of mass production, because the computer (robots run by them) will know how to organize the manufacture such as single copies are produced on a mass production assembly line. Think of CNC machines for an example. Nanotechnology will play a huge role as well.

    Much of the work will not be one-off design, but programming to generalize design choices. There will also be a lot of one-off design too, the Italians will still find a market for their aesthetics, etc.

    Also agriculture is dying. It is being homogenized and even Monsanto is designing seeds which won't reproduce and spread their infertility to nearby natural plants. This is to be expected as vested interests try to squeeze more out of a dying economic sector. There is almost no profit to be made in agriculture, because primary costs are oil. The EROEI in agriculture is negative. There is a lot more to say about this, you can refer to Steve D'Angelo's writings (SRSrocco at my forum and the jasonhommelforum.com).

    -Shelby

    ReplyDelete
  38. Remember the video where Steve Jobs points out that humans don't have more efficient locomotion than condors and other animals, but because we are tool builders we are more efficient (e.g. the bicycle)! That is so profound:

    http://goldwetrust.up-with.com/technology-f8/computers-t112-45.htm#2984

    -Shelby

    ReplyDelete
  39. I suggest, Shelby, you take a look at the top universities and all seats of learning around the world.

    Also go into the back rooms, the design workshops of software manufacturers, graphics, or wherever all what you see as being the future is being developed and see how many are young Chinese, Japanese and Indian.

    Chinese money, billions of it, will be (is now) ear marking and buying up companies that will spread the world, but with a strong home base.

    They are dragging their feet only because of the paranoia, and scare mongering with threats that already emanates from the US that anywhere else should, or could do what it did during its age of self glory now ending.

    But this will never be allowed to develop into too extreme Nationalism.

    Nationalism has been relegated to the sports field.

    It may be the United States, but on the sports field one State will 'fight' another, even one faith against another. There is still much rivalry between States, especially North and South.

    We must never forget what the final plan is - ONE WORLD. How many more ways do you want them to tell you.

    All we will see meanwhile is a fight for 'pecking order' within the world order. I do not say 'new' world order, because it already exists, and has for some time. It is just that most are too dumb to see it.

    ReplyDelete
  40. I hope everyone say this:

    http://www.kitco.com/ind/Laird/may052010.html

    I am not making any predictions about his timing, but over next years or sooner, I agree with his prognosis.

    Ray, there is no doubt that asia has 50% of the world's population and thus 50% of engineers I see are asians. So what? I was writing about the future of the Chinese state, and specifically its iron hand and centralized economic model.

    -Shelby

    ReplyDelete
  41. Refer to my prior post about why I don't favor investing in mining stocks.

    Australia adopts super-tax on mining (I've read about similar moves coming in USA):

    http://globaleconomicanalysis.blogspot.com/2010/05/super-tax-hits-australia-in-us-gold.html

    -Shelby

    ReplyDelete
  42. shelby-YOU SUCK! why don't you and the other nutcase just email each other and stay off this website. is anyone else tired of slogging trough the pointless drivel spewed out by thse IDIOTS?

    ReplyDelete
  43. Pointless? Are you sure? Proof?

    I suck or the reality of what is happening in the world sucks?

    I can understand your frustration with the current reality, but it is better to face it and deal with it.

    What exactly am I obscuring that you would like to see discussed here? You want to talk about bets on this market?

    Do you not believe my assertion, that there won't be any market soon, and that everyone who stays in this paper charade is going to lose everything?

    You have been warned about the coming reality.

    ReplyDelete
  44. PS Anonymous, the fascist who wants everyone to read only what HE likes, which is only what has a minor bearing on the markets, YOU are the only 'nutcase' here. But you are too thick to know it.

    ReplyDelete
  45. Stop reading these end of the world scenarios. Or if you must read - stop believing them.

    Imagine you are an analyst living in around 1860. What end of the USA scenario you could write. A young nation recently built from the union of 13 independent colonies. Economic turmoil, still in huge debt to the 'International Bankers' who caused the revolution, so they could gain control of THEIR 'promised land' in perpetuity through debt. The country splits into two with a bloody civil war (more in debt).

    They create two separate currencies neither which had any substance. Soon its presidency suffers its first assassination.....need I say more..................(what dumb schmucks.

    Who could have forecasted that not only would it hold together but become fifty states, and fight 'united' in two world wars (more debt_

    How could this be?

    Because the International bankers who owned the US then, as they do now, ensured that it did. It was in their interest, THEY LOVE YOUR DEBT

    Why has the UK ( a tiny island that could fit in one US State, held together in spite of appearing to lose the largest world Empire that spanned the globe and upon which the sun never.
    set - in fact, how did it ever build such an Empire?

    Because the International bankers that own it, and whose money financed that Empire building (they now own) ensured that it did. It was in their interest.

    How was all those warring nations, with strong 'national interests' that their men died to defend, come together and become the EU, with one currency? Because........yes, you got it.........

    Around the time of the American Civil war, it was a world of turmoil and smashed or dodgy economies. The British prime minister at the time was Jewish - Benjamin Disraeli.

    In today's media language he would have been labelled the most powerful man in the world simply because he was the elected head of a nation who's navy ruled the waves, and he sat at the head of the world's largest empire.

    But that man told it like it was. He tried to enlighten us all, but we did not listen. He said, and it is written in his book 'Coningsby' - "This world is governed by far different personages than can be imagined by those on the outside"

    Got that YOU Schmucks (This is history for dummies)!

    The International Bankers own the world. It is their money. They have a very simple economic theory that beats any other, and it is all you need to know -

    'He who has the most gold (money power) makes ALL the decisions that matter'. (take that in its widest sense)

    They control the IMF, the US Federal Reserve Bank, all the world's reserve banks in one form or another. In fact, they are at the very top of everything that is of consequence. They can issue, or remove money at will. That is what control means.

    Once again for the sake of all the 'outside' anonymice that linger here with their closed minds, and narrow views -

    "This world is governed by far different personages than can be imagined by those on the outside"

    What will prevail, is what is in THEIR interest in banging heads together as they mould this world into one. And, until that sinks in you are groping in the dark.

    And with this, I really do leave you all. So now you can breathe a sigh of relief.

    ReplyDelete
  46. Ray Newton, seems you got pissed off, because I pointed out what dis-logic you have. You said China was becoming powerful because I see Asian engineers every where, and I retorted your dis-logic by saying that 50+% of world population is Asian, and thus I should see 50+% of the world's engineers as Asian.

    So after sticking your foot in your mouth numerous times, now you go on the attack with more dis-logic.

    First there was your nonsense yesterday, advising people to buy dollars. All the paper currencies will die relative to paper price of gold. You've got to be the world's biggest idiot to be buying dollars. The dollar may go to parity with the Euro, while gold goes to $1300+ this year (probably much higher). Sure gold will oscillate, but the fact is gold will on average be higher against the dollar year after year forward. How stupid the advice to buy dollars! I wrote make a beeline to gold & silver, during that dip to $1160s this week, and now today gold jumps over $1200.

    Now your nonsense about how the USA in 1800s is an example for us of what can happen to UK and China and EU going forward. You apparently whor(E)ship the power of the international bankers, but nature is more powerful than any men. Why do you pray to these men? You are a slave in your mind, but you could choose to be. You can walk outside today and be free, the international bankers can't stop you from doing that. They are not omnisciently powerful.

    In the 1800s, the USA was using gold and silver as money. Most people (in the rural farms) ignored the paper the currencies (Continental, etc). They were going outside to the real things, just as we can do now. The international bankers did their best to foment war, debt, economic volatility, etc. But the fact is, the numbers show unequivocally that those who saved in gold in the 1800s had a 33,900% better return than those who held dollar bonds in the 1900s (here follows the numbers for proof):

    http://www.marketoracle.co.uk/Article16212.html

    http://www.coolpage.com/commentary/economic/shelby/How%20Deflation%20Is%20Inflation.html
    (another copy)

    http://www.coolpage.com/commentary/economic/shelby/How_Deflation_Is_Inflation.pdf
    (PDF copy)

    (continued in next post)

    -Shelby

    ReplyDelete
  47. (continued from prior post)

    It is not the international bankers who are in control. Nature is in control. And the nature of people, is they love debt and insurance and laws that "can alter reality" (not!). And as this pushes their result to failure with a very large public sector that eats all their production. Failure Ray. Got it? Failure.

    Yes the EU, China, and USA will huddle together to save their co-dependent financial mess. They will go as far as they can in failure mode, even to the point of rationing and fascism in order to fight the free market reality that they must end their big govt eventually. How far can it go? How far could Hilter go? Eventually failure fails, and the international bankers have to be in harmony with this trend. But yes, even while WW2 ended, the bankers gained more control. Why? Because most of the people want what they are selling (debt, insurance, big govt).

    And yes we will head to a NWO.

    It is very important to understand, that humanity produces 1000 times more than it needs. It is via debt slavery that scarcity is created. So sure, a NWO can actually be pleasant, if we only get 1/1000 of what we produce, we still get what we need. And the international bankers take the other 999/1000 of all production. This is a huge opportunity for those who understand the free market.

    Invest in the dollar if you want to capture 1/1000 of the world's production, and invest in gold if you want to capture 999/1000 of it. After this supercycle, then look for ways to invest that bring that 999/1000 to the people and bypass the international bankers' theft system (taxes, debt, big govt). Those who are clever (and I mean some P2P aspect of internet no man can ever control), will reap $trillions and surprice mankind. The bankers will have to be in harmony, they are not as powerful as you think.

    -Shelby

    ReplyDelete
  48. Ray who is the real fear monger? Who has been brainwashed by the finest educational institutions in UK?

    http://silverstockreport.com/2010/why-fear.html

    "Will the real fear mongers please stand up?

    ...So who ultimately writes the schoolbooks? Bankers...It is actually harder to convince a college educated investor to buy silver and gold than a person who has not paid to be brainwashed in college...

    ...Bankers play on people's fears...you are supposedly not responsible enough to invest it wisely...your money might be stolen if you keep it at home...even though it's safe enough for you to sleep there in peace at night.

    ..."What if someone comes to my home and threatens me like in the movies?" ...that usually happens only in the movies!

    Today, 20% inflation rates would be as if thieves robbed 100% of all the assets of every 5th home on the street, and got all their financial accounts, too, every year...

    ...I have to convince them that the silver and gold of 10,000 different investors, in 10,000 different vaults in 10,000 different homes, all owned by gun owners, who live in a nation that has 80 million gun owners, is far, far safer than pooling 10,000 different investors money into one place, guarded by just a handful of low-paid security guards. It's an easy sell, because the point is irrefutable.

    ...if the government ever does make silver and gold illegal to own, it's those places that "hold" it for you, that will have to give it up to the government...

    ...bankers fear silver. The bankers fear their own bankruptcy. That's why they created the Federal Reserve...to bail them out in case of their own failures, so they would be able to continue their scams..."

    ReplyDelete
  49. The title of my 3 prior posts should be:

    The NWO is succeeding? (define "success")

    ReplyDelete
  50. I will buy silver (after buying more gold at $1080 - $1169).

    Back up to 68 ratio to gold. Yeah the world economy will collapse and the world will be filled with a glut of silver. Yeah sure! I am buying that dis-logic.

    As gold heads north of $1300, and silver still under $20, and as the stampede to hard assets gets more urgent, some people are going to realize that silver at less than $20 is a no brainer. Especially when the entire annual mining market is only $10 billion. As of 2009, China does not allow the export of silver. In fact, I know they are net buyer of silver from Philippines where I am.

    -Shelby

    ReplyDelete
  51. You are right about the self interest of the world bankers. Remember the golden rule; he who has the gold rules. Derek you have so much egg on your face for the 600 dollar an ounce prediction for gold you could make an omlette the size of california. Bro your model is very broken!!!

    ReplyDelete
  52. Shelby

    You can't fo to the supermarket and pay with gold. Not now, and I doubt NEVER!

    Join the real world!

    Also learn to read what a person is saying and do not twist words to suit you.

    I could rip your blurb into tiny pieces
    But that would give it credibility.

    Get your head out of the bible, and nature. Nature is capricious, and today even IT can be manipulated, as China did with the weather for their Olympics.

    We are all living in a virtual real world, not just in the movies, but in real life.

    In the UK in spite of what you are lead to believe, it has always been the British way to look objectively at the rest of the world, and give credit, even to our enemy when it is due.

    We have also had much more interaction with other nations, and cultures.

    You say you are a mathematician. Then go to Hong Kong, for one, and see the high level of maths, and working out difficult maths in their heads - 7 and 8 year olds. They left our interviewer, no dummy himself, standing.

    The wealth in Hong Kong makes a mockery of Forbes list. That city, itself, never mind the Mainland will blow anyone's mind.

    Napoleon made an under statement when he said about not waking the Chinese dragon, as it would shake the world,

    Luckily, for us all, it is not a nations that will shake it with a display of 'shock and awe' with bunker busting bombs and un manned drones, a la pax Americana (Bush style).

    I have been. I have seen. And I know where we are going.

    ReplyDelete
  53. That should read 'I doubt EVER'.

    I am off to Italy now to enjoy some sun and fun.

    ReplyDelete
  54. Well I bought silver yesterday as I wrote here I would do, and then a +4% jump today. Nice to get one correct, after missing the bottom at $14.60.

    Ray goes on idolizing failure. So be it.

    Here are some realities I have experienced in Asia, coming soon to the western nations:

    http://goldwetrust.up-with.com/economics-f4/changing-world-order-t32-75.htm#3005

    Everything is going to be looted and stolen. All your insurance and comforts will evaporate. You either have gold & silver and fight, or you will be a loser.

    -Shelby

    ReplyDelete
  55. Ray I will retort 2 points you made:

    1) Anyone who is investing their food money, doesn't have enough $ to be investing. Near-term, the groceries may not have enough food (rationing/war/Monsato infertile seeds/etc), make sure you have some in storage and ability to grow your own (or relationship with nearby farmers who don't rely on fuel and fertilizer and commercial seeds).

    2) Academic excellence does not guarantee economic success. Asia (especially China) lives in a political stone age. They know it, or at least they did, before they were bought off recently with glimmer of materialism wrought from slave labor (Yuan peg) mercantalism driving a 60% concentration in the economy for construction, with large % of the remainder in exports. Math won't help them with the reality of blowback from such mis-allocation. Fiddling with their calculators won't stop nature...neither could TPTB stop this blowback even if they wanted to (and they do not).

    -Shelby

    ReplyDelete
  56. Ray I will retort 2 points you made:

    1) Anyone who is investing their food money, doesn't have enough $ to be investing. Near-term, the groceries may not have enough food (rationing/war/Monsato infertile seeds/etc), make sure you have some in storage and ability to grow your own (or relationship with nearby farmers who don't rely on fuel and fertilizer and commercial seeds).

    2) Academic excellence does not guarantee economic success. Asia (especially China) lives in a political stone age. They know it, or at least they did, before they were bought off recently with glimmer of materialism wrought from slave labor (Yuan peg) mercantalism driving a 60% concentration in the economy for construction, with large % of the remainder in exports. Math won't help them with the reality of blowback from such mis-allocation. Fiddling with their calculators won't stop nature...neither could TPTB stop this blowback even if they wanted to (and they do not).

    -Shelby

    ReplyDelete
  57. Remember China got where it is by stealing from the west, this is the economic model of our future. Abject failure. TPTB want that people will fight and steal from each other, so that their NWO will look attractive in comparison.

    -Shelby

    ReplyDelete
  58. @ Ray,

    I think you are right on in must things you have written is this blog. I appreciate your insight and have opened my eyes to a more objective view.

    Thanks,

    Kiley

    PS. If you ever decide to leave this blog.. I would still like to keep in contact. My e-mail address is kileykuhl@yahoo.com.

    ReplyDelete
  59. @ Derek,

    I miss your daily comments on the markets.

    Kiley Kuhl

    ReplyDelete
  60. From Italy

    Shelby

    You writE

    "....Remember China got where it is by stealing from the west, this is the economic model of our future. Abject failure. TPTB want that people will fight and steal from each other, so that their NWO will look attractive in comparison....."

    The human race has been stealing, or leaning, from each other ever since they walked on two legs

    China was civilised long before the west, and was inventing things when the only Americans were red Indians hunting bison, and invented nothing.

    You talk such twaddle about something of which you are so ignorant. Take a trip to Hong Kong that is where so many Phillapinos go to make money ro send home ro their families to survive.

    No I did not read this, I saw it, and spoke with them.

    When you have been to Hong Kong or Shanghai, then come back and write. I am not interested in Marc Faber, he has ulteria motives for what he writes.

    The Brits invented many things, but we also learned (and stole)from the Greeks, Romans and Chinese.

    ReplyDelete
  61. Kiley Kuhl,

    Many thanks for your kind words, and have noted your email address.

    ReplyDelete
  62. Shelby,
    Learn to read what is written

    Nowhere have I saud or even inferred that Academic excellence guarantees economic success

    In facr I say just the opposite. I have said that is the cause of bad economics. And I have said this with great clarity, and often. AND YOU KNOW IT!

    Anything posirive I have, or may have, said with regards to Academia has not been in relation to economics.

    Now, take time to READ what is written, and do not invent.

    Shelby, You have a blog, why do you not invite comment?
    You post. on your blog, all your comments to me, but do not post any of my reponses, or points I make.

    Of course, we can guess why.

    ReplyDelete
  63. Ray, I recently had to shut down new signups to my blog, because spammers were signing up and posting sex and drug ads. I will open the signup page briefly for 24 hours, please complete your member signup, before I turn it back off again. You are welcome to post at my site, but I kindly request you start a new thread and link to any of my posts that you want to comment on. I prefer to give you your own thread, because of the verbosity that will ensue in our discussions. Perhaps this is an idea for how Derek could handle us without banning us.

    -Shelby

    ReplyDelete
  64. Ray,

    I opened new member signup to my forum for 24 hours. Please signup before I close it again. Please make a new thread at my site for posting your comments. I had to close the new membership, because spammers were bombarding the site with ads about sex and drugs.

    Yes I do copy many of my comments to my forum, to make sure I don't lose my analysis.

    -Shelby

    ReplyDelete
  65. Ray,

    I opened new member signup to my forum for 24 hours. Please signup before I close it again. Please make a new thread at my site for posting your comments. I had to close the new membership, because spammers were bombarding the site with ads about sex and drugs.

    Yes I do copy many of my comments to my forum, to make sure I don't lose my analysis.

    -Shelby

    ReplyDelete
  66. Ray I was in Hong Kong during December, and strolled most of Kowloon, even down in the market 5 kilometers from the main strip (by foot!).

    Yes I do remember you writing about how the economics taught at universities is faulty. That doesn't change the fact that you keep preaching about how superior asians are at engineering and how they will thus dominate. I have stated that it is only natural that they take a larger role in the world, since their population is such a large chunk of the world. Asians do not a superior per capita intellect as compared to causcasians. Nor do they have a superior education, because education must include the ability to think in terms of free markets (something Chinese have a very hard time with). Also you are wrong when you wrote the Chinese have never built dynasties or conquered other people. Are you freaking blind? Tibet? The many tribes in China oppressed? How do you think China got so big? Conquest!

    You are comedy of errors. It is extra funny since you came to this blog with such a condescending attitude talking as if westerns are just stupid and asians are so much more wise. It isn't true. Asians are just as prone to the same mistakes as westerners have made.

    -Shelby

    ReplyDelete
  67. Ray I was in Hong Kong during December, and strolled most of Kowloon, even down in the market 5 kilometers from the main strip (by foot!).

    Yes I do remember you writing about how the economics taught at universities is faulty. That doesn't change the fact that you keep preaching about how superior asians are at engineering and how they will thus dominate. I have stated that it is only natural that they take a larger role in the world, since their population is such a large chunk of the world. Asians do not a superior per capita intellect as compared to causcasians. Nor do they have a superior education, because education must include the ability to think in terms of free markets (something Chinese have a very hard time with). Also you are wrong when you wrote the Chinese have never built dynasties or conquered other people. Are you freaking blind? Tibet? The many tribes in China oppressed? How do you think China got so big? Conquest!

    You are comedy of errors. It is extra funny since you came to this blog with such a condescending attitude talking as if westerns are just stupid and asians are so much more wise. It isn't true. Asians are just as prone to the same mistakes as westerners have made.

    -Shelby

    ReplyDelete
  68. Shelby are you really trying to upset
    Derek and everyone by posting EVERYTHING twice.

    Nowhere have I said anyone is superior. But you try to make out they are a nation of loonies tottering on the brink.

    You must have walked around Hong Kong with a white stick, your eyes (and mind) firmly closed.

    Do not pass over one admitted error by making another.

    As you see me, I am a comedy of errors, so will not grace your blog.

    ReplyDelete
  69. DEREK- HAVE YOU SEEN WHAT THESE TWO IDIOTS ARE DOING TO YOUR WEBSITE? IF YOU ARE SERIOUS ABOUT WHAT IS POSTED ON YOUR WEBSITE YOU WOULD BLOCK THESE TWO PRICKS FROM EVER POSTING AGAIN

    ReplyDelete
  70. Apologies to Derek for saturating his business with this debate. Ray let's move it over to my forum. Make your own thread there, I won't censor you and I will try to de-personalize my criticism. I suppose I am just trying to shock you into fighting for freedom.

    Apologies for the double posts, as you noted Ray, due to some technical glitch, this blog doesn't always post the comments immediately.

    Ray actually you wrote something recently that was very important and helped me refine my understanding. You pointed out that EU would not be broken up. Ah, then it all made sense to me, yes the EU will huddle together and fail in their socialism together. So don't think I am not learning something from you.

    I guess I have gone on the attack regarding your tendency to respect very much the power of the elite to bring EU into one world, and the role China will play, etc..

    You know we can bust their balls right now, if we can just stop all these defeatist attitudes and mis-information, please read my debate with the famous Mish Shedlock:

    http://goldwetrust.up-with.com/economics-f4/inflation-or-deflation-t9-360.htm#3008

    I like to win. I like freedom. Vince Lombardi said you never lose until you refuse to stand back up.

    We don't have to accept the Chinese way (controlled by a big govt, no free speech, etc). Don't you like the ability to write freely on the internet? You can not do that in China.

    -Shelby

    ReplyDelete
  71. Unimportant Announcement! The Ray/Shelby show will
    be coming to local pubs throughout areas hit by
    the offshore oil spill to make local citizens feel
    good when R&S leave town thus diverting their attention from the oil spill by the relief of
    witnessing the departure of the noxious fumes of
    BS emanating from the mouths of the Diarreahtic
    Duo!

    ReplyDelete
  72. I am done wasting my time on this dribble \will not be back to check what was informative at one time

    ReplyDelete
  73. Anonymous BIG MOUTH stop speaking for others. You are a loner who has to resort to caps to try to be heard. I and some others have learned much from R N and Shelby. Not everyone who comes here posts but we read and learn from opposing thought. (My first post)

    Blogs are destroyed by intolerant moaners and complainers LIKE YOU

    So Shut TFU. This blog has never been so lively

    George W (No that other one)

    ReplyDelete
  74. Anonymous

    We are not all of the same mind. Some like lively debate on issues which involve market influence from different perspectives and other countries.

    Derek, do not be influenced by local negative complainers about those who keep your web alive until you have time to post.

    We are always ready to hear from you, and it keeps us here.

    ReplyDelete
  75. what a bunch of verbal diaherria you two spout,i as well am done with this crap

    ReplyDelete
  76. Go to another forum.....both of you! All you are trying to do is show off who has the bigger brain...

    ReplyDelete
  77. What YOU are showing is what a little one and narrow one YOU have-

    You deserve to be the loser that you so obviously are.

    I and I am sure many others have learned a lot from the two you have not the brain to comprehend.

    ReplyDelete
  78. Learned more from them then from the Derek Loser. He only put the third option after some said something about one the forum. Even then he put in as a JOKE

    ReplyDelete
  79. Btw, the debate with Mish has continued and you can read it at the link I gave above in prior post.

    I hope Ray is alive and well. I don't know if there is too much more to say. I think the debate with Mish has illuminated most of my thoughts.

    -Shelby

    ReplyDelete
  80. From Italy

    Shelby, that link you gave would not pull up for me.

    Also have lost your web blog link.

    ReplyDelete
  81. I would simply be interested in knowing why Derek always seems to go quiet when metals are rising? Not a perma bull on PMs but you are pretty conspicuous by your absence during these times...inquiring minds and all.

    ReplyDelete
  82. I think he is on his new website. Gold $600, NOT Today, maybe some future date (how that for a prediction) silver $7 NoT.

    ReplyDelete
  83. Derek,
    How's your silver's abrupt turnaround and back under $14.00 scenario after a brief possible pop over $19.00 looking? Tired of these forecasters who make these predictions then go dead silent, only to pop up later with nary a word about prior predictions, unless correct of course.

    Maybe silver will reverse/correct. It is overbought and has run pretty hard the last three days. Still like to see you comment on the run in both Gold and Silver we have seen today. (Gold to new all time high, and Silver at potential break-out level).

    Gerry.

    ReplyDelete
  84. Ray wrote:
    "China was civilised long before the west, and was inventing things when the only Americans were red Indians hunting bison, and invented nothing."

    I have too heard or read that China invented gun powder and paper money, etc.. The american indians apparently taught the Europeans how to survive their first hard winter, for example teaching them that planting a fish with their crops would act as a fertilizer. I suppose each was adapting to their differing environment. Asia due to its mild climate during last ice age, was more populated and thus there was more competition for resources apparently. Thus the asians learned how to use advanced tools of war and society control, and also how to live together in large concentration. The native Americans learned how to live in harmony with the land (given their small footprint on its resources) and how to remain mobile to prevent any resource depletion nor conflicts.

    -Shelby

    ReplyDelete
  85. I agree with Anonymous. Derek, man up and admit you blew it big time in terms of your 600. oz gold prediction and your 14.00 dollar silver. You are NEVER going to make it as an "analyst " if you don't admit to your mistakes and try to correct them. Why the silence?

    ReplyDelete
  86. Derek B.: Another smart economist who has no clue about Gold.

    The list is legion.

    ReplyDelete
  87. If the Elliott Wavers ever had a case for extreme optimisim= its now. Everybody and their brother is touting gold. All gurus except Derek, are saying now is the time. I guess there's a chance that this is a double top and unless we go through 1225 with convincing momentum it may back off. I think this may be what the prechters talk about as extreme sentiment. It just seems that eveybody is talking gold for many different reasons, armageddon, momentum, reserve currency, 10 year bull, central bank buying, China, yadda, yadda, yadda. It just doesn't feel like it should be happening now. Or is that just the reality of the situation, something you wait for, for such a long period of time, you will always be surprised when it finally does. At this point I wish I had not come across Derek's postings, because I lightened up significantly thinking he may know something I didn't. Any others make the same mistake?

    Ed in Jersey

    ReplyDelete
  88. Yea, i want to be just like Shelby. Sitting all day at an internet cafe in the Philippines surrounded by people that hate his guts and would love to rob or kill him. Great life!

    ReplyDelete
  89. Anybody that listens to this guy's advice must like pain...

    ReplyDelete
  90. I did not lighten up because Derek's fundmentals were not sound. He is young and does not have ANY historical basis for his misguided opinions. I feel for you if you listened to Derek's "forecasts". Check out Richard Russell. The guy has been on it for years and actually understands the broad markets ie currencies,equities precious metals and bonds. He has lived through more economic changes than Derek will ever hope to. No disrespect to Derek but be careful about parting with your gold or silver!

    ReplyDelete
  91. A Late Night Comment.

    I just noticed a reader commented about recommending to sell physical gold and silver - I have not, nor would not, make any such a recommendation on this site. All gold and silver forecasts are long-opportunity forecasts: As in, is now a good time to make a major physical gold or silver purchase? I have never recommended reducing a physical position.

    Any other assets - stocks, bonds, ETFs, etc, are long and short recommendations, but I have long-written that it is wise to have 50% of one's cash savings in money - physical gold and silver.

    Derek Blain.

    ReplyDelete