CONSUMER DRIVEN INFLATION??

Getting people to buy into the chart mentality is how they will orchestrate the final major crash.

And think about all these software packages that create buys for people based on patterns.

If you know the formulas in those programs, and how many people are using them, you can predict what lots of idiots will do who rely on those programs. That information allows you to asscrew the shit out of them.
 
DigitalDave said:
Look Chap, earlier last year, SF tryed to convince me that the market wouldn't bottom at around 6400 using Charts. Charts don't mean shit for the future because they are just charting the past. I put reasoning behing my madness, dispute it. So far all you are saying is gold prices will pop and pop-hard because it's happened in the past. You are not making an argument. You are starting to sound like Desh.
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I didn't say 'wouldn't' .... I said 'shouldn't'.... I know that is not much of a difference... thus take it for what it is worth.

Besides... we haven't bottomed yet. :)
 
DigitalDave said:
What are you comparing the value of the dollar to? Right now you can compare it to all sorts of things and you can view it as either rising or falling. If you view it as a normal, everyday, breathing human being who needs money to buy shit, you would compare it to the CPI. In that sense, the value has been decreasing ever since the early 1900's.
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The CPI has been negative this year. It was negative at a rate of 10% a year during the great depression.

The dollar is decreasing in value compared to most things, which is an unusual situation. To claim that the value of dollar is completely and totally dependent upon the amount of dollars in circulation is economic illiteracy.
 
DigitalDave said:
Look Chap, earlier last year, SF tryed to convince me that the market wouldn't bottom at around 6400 using Charts. Charts don't mean shit for the future because they are just charting the past. I put reasoning behing my madness, dispute it. So far all you are saying is gold prices will pop and pop-hard because it's happened in the past. You are not making an argument. You are starting to sound like Desh.
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I stopped trying to use fundamentals of anything to predict markets. Its far to easy to manipulate bubbles up and down with big money. Since we have no good controls in place to stop it... gold is prime for a fast crash so futures optioners can make money on the downside. For us the market is driven by big players up and down.. we just have to try to attach onto whatever they are playing with.
 
AssHatZombie said:
Getting people to buy into the chart mentality is how they will orchestrate the final major crash.

And think about all these software packages that create buys for people based on patterns.

If you know the formulas in those programs, and how many people are using them, you can predict what lots of idiots will do who rely on those programs. That information allows you to asscrew the shit out of them.
Click to expand...

While I do use charts to assist in the buy/sell decisions, you are correct. If you have people using published algorithms/charting techniques, they can be manipulated. When you use one or two technical trading indicators, which is typical of the novices... you are likely to get burned. When you use 15-20... it is much harder (though not impossible) to manipulate.

That said, the buy-and-hold mentality is what Wall Street advisers truly love. It means that they earn their fees without actually having to manage the portfolios. They just give you a little pie chart and tell you to hold a little bit of everything and then 'ride it out'.
 
Superfreak said:
That said, the buy-and-hold mentality is what Wall Street advisers truly love. It means that they earn their fees without actually having to manage the portfolios. They just give you a little pie chart and tell you to hold a little bit of everything and then 'ride it out'.
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I blame that on fact that they dont educate kids on investing in high school. I always felt personal finance and personal health is far more important at a highschool level then say social studies or some liberal art. Most people don't have the knowledge (especially before age 40) to make the right financial choices.
 
Chapdog said:
I stopped trying to use fundamentals of anything to predict markets. Its far to easy to manipulate bubbles up and down with big money. Since we have no good controls in place to stop it... gold is prime for a fast crash so futures optioners can make money on the downside. For us the market is driven by big players up and down.. we just have to try to attach onto whatever they are playing with.
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As to gold... I think you are both correct to an extent. The first portion of the correction in gold prices is likely to be as Dave suggests... a slow fizzle out for a month or two... It will take a while to convince investors that a correction is taking place there. Unlike the tech and housing bubbles, gold is the one true currency in the world. Given the amount of fiat money being pumped into the global markets, most investors see gold as a good long term inflation hedge.

If we get a 10-15% correction, then you might see the big players try to push it down fast. I doubt you will see it before the first correction as gold is currently a freight train heading in the other direction. No one wants to put big money in the way of that train. Especially when the long term valuation of gold is undervalued despite the recent run up.

Theoretically with all of the fiat money being printed, gold could see a fair value increase to $4k per ounce. Though I do think we are due for a correction back towards $1k first. We are currently chasing the price with stops that are getting tighter.
 
Superfreak said:
While I do use charts to assist in the buy/sell decisions, you are correct. If you have people using published algorithms/charting techniques, they can be manipulated. When you use one or two technical trading indicators, which is typical of the novices... you are likely to get burned. When you use 15-20... it is much harder (though not impossible) to manipulate.

That said, the buy-and-hold mentality is what Wall Street advisers truly love. It means that they earn their fees without actually having to manage the portfolios. They just give you a little pie chart and tell you to hold a little bit of everything and then 'ride it out'.
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Yeah. More like "ride it straight into hell, suckers". That's the real quote.
 
Chapdog said:
I blame that on fact that they dont educate kids on investing in high school. I always felt personal finance and personal health is far more important at a highschool level then say social studies or some liberal art. Most people don't have the knowledge (especially before age 40) to make the right financial choices.
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I absolutely agree that people need to be educated early on when it comes to investing. The problem comes in that even if you were to take a college level course on investing today, the odds are that you would be taught modern portfolio theory and Markowitz's efficient frontier. When the bulk of the industry and world of academia are still teaching this theory, then it is unlikely that many individual investors will avoid that mindset when seeking advice.

When people like Suzie Orman are considered 'experts'... we have a very big problem. For those that are unaware... I think Suzie is one of the most intelligent people on this planet when it comes to self promotion and marketing. Oprah is the only one I can think of off hand that beats Suzie. That said, Suzie lasted about 6 months on Wall Street. She is now a parrot that runs around making blanket statements without much regard to the vast differences individual investors have with regards to their portfolio needs/risk tolerances.
 
Superfreak said:
I didn't say 'wouldn't' .... I said 'shouldn't'.... I know that is not much of a difference... thus take it for what it is worth.

Besides... we haven't bottomed yet. :)
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lol, I'm pretty sure we've bottomed in the short-term. Long-term there will be some other major manufactured catastrophic event to drive the market down again. We will wait and see :)
 
DigitalDave said:
lol, I'm pretty sure we've bottomed in the short-term. Long-term there will be some other major manufactured catastrophic event to drive the market down again. We will wait and see :)
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I see double dipping on the horizon. Will it absolutely happen... no. But if we do not see the unemployment situation and credit situation addressed soon... down we go.... and this time, I seriously doubt people are going to listen to the 'ride it out' crowd. My guess is that they will kick, scratch and claw their way for the exit trampling any poor sucker that gets in their way.
 
Two things this market needs to see right now....

1) Return of Glass Steagall and the subsequent breakdown of the investment bank/retail bank combo's that are a result of the idiotic repealing of the Act in 1999.

2) Return of the uptick rule... the pure manipulation Chap talks about is largely possible due to the removal of the uptick rule back in June of 2007. Those that say 'it doesn't do anything' are arguing the hardest that it shouldn't be put back in place... hmmm... let's think about that. If it doesn't 'do' anything.... then why do they oppose its return???? Oh yeah.... because it stops them from shorting the crap out of stocks with reckless abandon. Driving companies such as Indybank, Bear, and WaMu into the manufactured crisis that allowed the 'too big to fail' banks to get bigger.
 
College leve econ 101 could be watered down a little and combined with personal finance to teach high school seniors. It would work wonders.
 
Topspin said:
College leve econ 101 could be watered down a little and combined with personal finance to teach high school seniors. It would work wonders.
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I don't think it has to be watered down (except for remedial math rejects like Ditzie). Economics and Finance should be taught in multiple courses. Too much of high school and junior high school are filler courses.
 
Superfreak said:
Two things this market needs to see right now....

1) Return of Glass Steagall and the subsequent breakdown of the investment bank/retail bank combo's that are a result of the idiotic repealing of the Act in 1999.

2) Return of the uptick rule... the pure manipulation Chap talks about is largely possible due to the removal of the uptick rule back in June of 2007. Those that say 'it doesn't do anything' are arguing the hardest that it shouldn't be put back in place... hmmm... let's think about that. If it doesn't 'do' anything.... then why do they oppose its return???? Oh yeah.... because it stops them from shorting the crap out of stocks with reckless abandon. Driving companies such as Indybank, Bear, and WaMu into the manufactured crisis that allowed the 'too big to fail' banks to get bigger.
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Totally agree! But we also need to throw a few people in jail :)
 
I think at least a few dozen if not a few hundred should go to jail.
This was at least as fraudulent as Enron, wolrdcom etc.
 
http://finance.yahoo.com/banking-bu.../gold-bugs-stand-fast-despite-metals-pullback

Gold took a $40-plus beating on Friday, but the gold bugs (not for the first time) are dug in and determined.

The trigger for Friday's fall, of course, was the big U.S. dollar surge following unexpectedly good (or, at least, not absolutely awful) employment data.

But the gold sell-off was broad. Kitco's Gold Index indicates that (by their reckoning) only $14.90 of gold's $46.10 decline was caused by the dollar rise.
More from MarketWatch.com:

The effect of this was to turn down The Privateer's famous Long Term US$ 5X3 Point-and-Figure Gold Chart, after the biggest up-spike in its 25-year history.

Gold will have to rise almost $25 from Friday's late price to turn this widely followed technical indicator up again. (The Privateer, it should be noted, thinks that will happen, eventually.)

But a $25 move in gold is not what it once was. This point was well made Friday morning in The Gartman Letter: "A 2% change with gold at $1,200 is a great good deal larger than is a 2% change in price at $600/ounce. It is that simple. Corrections intraday can easily be $25-$30/ounce, and mean absolutely nothing except to take late, under-capitalized traders out."

Gartman, writing very early while gold was still above $1,200, also said: "We'd not be surprised to see it trade down ... by a dollar or two or three late today. At that point, we'll be a buyer for those who've remained out of the market thus far. It is a bull market, and in bull markets one buys weakness when weakness avails itself."

Gold bugs aren't too fond of Gartman, who in the past has regularly rubbished their pet theories and whom they claim is close to key market players. They will be watching closely to see if this influential commentator follows through.

The gold bugs themselves are standing firm. And they can claim they saw it coming. Presciently, James Turk's last posting on his FGMR.com Web site in late November observed: "I still think $1,200-$1,400 is a reasonable target for the end of this year. ... But first, it seems likely that gold will re-test support. ... So I expect gold to trade under $1,150 sometime this week. If we do see a drop into the $1,140s, it will be an ideal opportunity for traders to add to their position."

Chartist Martin Pring of Pring.com said: "The [gold] shares have just moved to their old high, and this might be as good a time as any for expecting a correction to develop. However, unless ... $1,000 [gold] ... is violated, a bullish overall stance is appropriate."

Which brings me to the group of what I call "radical gold bugs," who comment on Bill Murphy's LeMetropoleCafe.

One Cafe writer points out that silver, which usually accentuates a gold move, was notably less damaged on Friday, causing gold to become cheaper in terms of silver: "I cannot recall ... [a] sustained period where the falling ratio of gold-silver has occurred in conjunction with a fall in the price of the metal."

Another points out that the gold shares sharply cut their losses on Friday afternoon, despite gold itself going significantly lower: "The last example of this was similar performance last October 30th (also a Friday) marking the end of the late October weakness precisely: A week later gold was $50 higher."

Le Metropole Cafe also looks to India. Curiously, it's the only letter I know of that regularly monitors off-take by India, by far the world's largest gold consumer.

Cafe wrote recently: "As noted on Friday, India was a buyer that morning with world gold at $1,203. ... India's importers are likely to be forced by their customers into the market on Monday."

Hence, no doubt, editor Murphy's characteristically pugnacious Friday evening headline: "Opportunity Time."
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