Dear Money Morning Reader,
The world is addicted to rare earth metals...
Without them, we couldn't make batteries for iPods, Blackberry Smartphones, Prius electric cars, computer chips, jet engines, flat screen TVs, cell phones or surgical lasers.
But one little mining company just unearthed the biggest rare earth metals discovery in 83 years - worth an estimated $58 Billion.
When the news hits mainstream, this penny stock should go ballistic and early investors could pocket 1,443% gains by January 31.
Sincerely,
Mike Ward
Publisher, Money Morning
P.S. There's a brief window of opportunity to get in while this junior miner is still dirt cheap and still virtually unknown. I urge you to click here now - before this stock takes off.
Check out the Research on the Web Success Forum:
It’s a massive discovery that has the power to save America from a green tech crash… break what’s been called: “the world’s first MINEROPOLY”… and make early investors as much as 1,443% by January 31st…
Sunday, January 2, 2011
Wednesday, December 29, 2010
11 Safe and Natural Cures Now Available To Discerning Citizens
11 Safe and Natural Cures Now Available To Discerning Citizens
The independent health research team at Natural Health Dossier has just recorded a special presentation for you.
In the video, they talk about 11 of the world's best cures. Their investigative team of doctors and medical researchers has scoured the world to find what they believe are the absolute most effective solutions for crippling diseases.
Please watch this video now. The information can literally turn your life around... or even save it.
If you delay in watching this, you might forget or the video might be taken down and you'll have missed out. But spend a few minutes watching this now and you'll be prepared if the worst happens to you or your family.
To Your Best Health,
Maria Dolgova
Associate Publisher
Natural Health Dossier
****************************************************
W A I T B E F O R E Y O U G O !
Discover...A Volcanic Rock That Out Smarts Heart Disease...Why HEAT May Be The Best Cure For Cancer...How To Reverse Your Diabetes Naturally...How To Look & Feel 10-15 Years Younger!
The independent health research team at Natural Health Dossier has just recorded a special presentation for you.
In the video, they talk about 11 of the world's best cures. Their investigative team of doctors and medical researchers has scoured the world to find what they believe are the absolute most effective solutions for crippling diseases.
Please watch this video now. The information can literally turn your life around... or even save it.
If you delay in watching this, you might forget or the video might be taken down and you'll have missed out. But spend a few minutes watching this now and you'll be prepared if the worst happens to you or your family.
To Your Best Health,
Maria Dolgova
Associate Publisher
Natural Health Dossier
Urgent Health Alert...
11 Safe and Natural Cures Now Available To Discerning Citizens
****************************************************
W A I T B E F O R E Y O U G O !
Discover...A Volcanic Rock That Out Smarts Heart Disease...Why HEAT May Be The Best Cure For Cancer...How To Reverse Your Diabetes Naturally...How To Look & Feel 10-15 Years Younger!
Tuesday, December 28, 2010
The Infestation of Corporate Lobbyists
The response is extraordinary.
Public Citizen supporters across the country are answering my urgent call for financial support with incredible generosity.
We’re pulling out all the stops to challenge corporate power from the moment the new Congress convenes in early January.
In the next four days—before the clock strikes midnight this Friday, December 31—we must reach our $150,000 goal to have a fighting chance against the infestation of corporate lobbyists in Washington, D.C.!
Please contribute $10, $20, $35 or whatever you can right now.
From winning the fight that created the Consumer Financial Protection Bureau, to mobilizing more than half a million people in support of a constitutional amendment to overturn the Supreme Court’s Citizens United v. FEC ruling, we’ve done good and great things this year.
Your online activism has been instrumental to the success we’ve achieved together. Now, as we prepare to take on a Congress more beholden to corporate greed than any in recent memory, I’m asking you to supplement your grassroots advocacy with financial support.
We can’t afford to face the new Congress wishing we had done more to strengthen our defenses. Contribute today!
We can’t do what we do without your grassroots advocacy. But we can’t organize and coordinate that grassroots effort without your generous support.
We need to raise $150,000 by midnight this Friday so that corporate lobbyists don’t get even one day’s head start in the new Congress.
Corporate lobbyists have risen to a new level of influence in Washington. They’re not just raising money for members of Congress, they’re joining congressional staffs and writing the very laws that directly benefit their former, and future, employers.
For example, Speaker of the House-elect John Boehner—who once handed out checks from tobacco company PACs on the House floor—hired the chief lobbyist for the medical device industry as his policy director. This example of the “revolving door” is representative of the pro-corporate mindset that dominates the Republican Party and even many Democrats.
Stand with Public Citizen against this corporate faction by contributing $10, $20, $35 or whatever you can.
There’s no question, we’re going to have to work in a more hostile political environment. But Public Citizen has met challenges like this in the past. We took on Nixon. We took on Reagan. We took on Bush. Both of them. And we consistently won substantive reforms and protections that make life better for ordinary Americans like you and me.
Public Citizen’s strength comes from the grassroots activism and financial generosity of our members. I want to thank you for all you’ve contributed by staying informed and taking action as part of our online community. And I want you to know that I’m counting on your financial support, too.
We will do this.
Together.
Robert Weissman, President
P.S. Contribute $100 or more right now and we’ll send you a DVD from a selection of progressive films like Battle in Seattle, An Unreasonable Man and The Story of Stuff as our thanks for your support.
To get regular e-alerts about opportunities for activism and other ways to help with Public Citizen's work, sign up for the Public Citizen Action Network.
Public Citizen supporters across the country are answering my urgent call for financial support with incredible generosity.
We’re pulling out all the stops to challenge corporate power from the moment the new Congress convenes in early January.
In the next four days—before the clock strikes midnight this Friday, December 31—we must reach our $150,000 goal to have a fighting chance against the infestation of corporate lobbyists in Washington, D.C.!
Please contribute $10, $20, $35 or whatever you can right now.
From winning the fight that created the Consumer Financial Protection Bureau, to mobilizing more than half a million people in support of a constitutional amendment to overturn the Supreme Court’s Citizens United v. FEC ruling, we’ve done good and great things this year.
Your online activism has been instrumental to the success we’ve achieved together. Now, as we prepare to take on a Congress more beholden to corporate greed than any in recent memory, I’m asking you to supplement your grassroots advocacy with financial support.
We can’t afford to face the new Congress wishing we had done more to strengthen our defenses. Contribute today!
We can’t do what we do without your grassroots advocacy. But we can’t organize and coordinate that grassroots effort without your generous support.
We need to raise $150,000 by midnight this Friday so that corporate lobbyists don’t get even one day’s head start in the new Congress.
Corporate lobbyists have risen to a new level of influence in Washington. They’re not just raising money for members of Congress, they’re joining congressional staffs and writing the very laws that directly benefit their former, and future, employers.
For example, Speaker of the House-elect John Boehner—who once handed out checks from tobacco company PACs on the House floor—hired the chief lobbyist for the medical device industry as his policy director. This example of the “revolving door” is representative of the pro-corporate mindset that dominates the Republican Party and even many Democrats.
Stand with Public Citizen against this corporate faction by contributing $10, $20, $35 or whatever you can.
There’s no question, we’re going to have to work in a more hostile political environment. But Public Citizen has met challenges like this in the past. We took on Nixon. We took on Reagan. We took on Bush. Both of them. And we consistently won substantive reforms and protections that make life better for ordinary Americans like you and me.
Public Citizen’s strength comes from the grassroots activism and financial generosity of our members. I want to thank you for all you’ve contributed by staying informed and taking action as part of our online community. And I want you to know that I’m counting on your financial support, too.
We will do this.
Together.
Robert Weissman, President
P.S. Contribute $100 or more right now and we’ll send you a DVD from a selection of progressive films like Battle in Seattle, An Unreasonable Man and The Story of Stuff as our thanks for your support.
To get regular e-alerts about opportunities for activism and other ways to help with Public Citizen's work, sign up for the Public Citizen Action Network.
Sunday, December 26, 2010
Celebrating 2 Christmas Family Traditions: Eating and Texas Hold 'Em!!
Happy Holidays,Facebook Social Network Blog Readers!
If your Christian, Merry Christmas!
If your Jewish, Happy Hanukah!
If you are Muslim, Happy Islamic New Year!
If you are African-American, Happy Kwanza! (Some of you get double the fun!)
And if your Atheist.... this is some pretty crappy weather we are having huh?
Regardless of how you spent the holidays, we hope you enjoyed it surrounded by those you love.
Jose Feliciano - Feliz Navidad
Christmas Songs - We Wish You a Merry Christmas Lyrics
If your Christian, Merry Christmas!
If your Jewish, Happy Hanukah!
If you are Muslim, Happy Islamic New Year!
If you are African-American, Happy Kwanza! (Some of you get double the fun!)
And if your Atheist.... this is some pretty crappy weather we are having huh?
Regardless of how you spent the holidays, we hope you enjoyed it surrounded by those you love.
Jose Feliciano - Feliz Navidad
Christmas Songs - We Wish You a Merry Christmas Lyrics
Saturday, December 25, 2010
The Descent of Money
Bill Bonner [Reckoning on January 29, 2010 from Paris, France]
Science and technology have produced many wondrous breakthroughs. But there are some things it cannot improve. A kiss from natural lips is still the lover's choice. Baby formula proved no match for the real thing. Ersatz money is a flop too. That last item is not so much a fact as a prediction.
The first modern competition between gold and paper money ended like the pre-modern ones. Gold won. Herewith, a short summary:
A rogue, John Law, was the protagonist of the story. He killed Beau Wilson in a duel. Then, he went on the lam...first to Scotland...then to Amsterdam...and finally to Paris. Like Alan Greenspan or Ben Bernanke, he made himself useful to people in high places - in this case the Duke d'Orleans, who needed money. Law had a way to get it:
"I have discovered the secret of the philosophers' stone," he is said to have remarked, "it is to make gold out of paper."
We need to look no further. Law may have been good with figures; it was at philosophy that he failed. A thing cannot be both one thing and a different thing at the same time. It is either gold. Or it is paper. Rarity and durability give gold value - as money. Paper's most conspicuous properties are just the opposite - it is common...and has a tendency to curl up and blow away.
Law's new, easy money helped France to an economic recovery - or so it seemed. But in the end, the philosophical error caught up with him. Gold has real value. If you can create it at will, why not create more of it? It was just a matter of time before he had created too much. Soon, there was an angry mob outside Law's office on the Rue Quincampoix. People who held his paper gold had come to see it in a different light. Where once they cherished it as paper gold...now they despised it as nothing but paper.
Law's scheme increased France's money supply - including banknotes and shares in his Mississippi company - by 300%. Prices in Paris doubled between 1718 and 1720. Then, when the new money system began to give way, the Duke d'Orleans "cranked up the printing press." By 1721, Law's money was worthless. "Banque" was a dirty word in France for the next 200 years.
The current experiment with paper money began on the 15th of August 1971. Henceforth, said Richard Nixon, foreign countries that wished to exercise their right to trade US dollars for gold could drop dead. From that point forward, the dollar was worth only what someone would give you for it. Philosophers held their breath. But nothing happened. Many have died since, waiting for the dollar to succumb first. Still, the millstones of monetary history may grind slowly, but the more slowly they grind, the more fingers they pinch.
The new paper money standard allowed for a worldwide credit boom - just as in Paris following the establishment of Law's scheme. The US created dollars. Its citizens spent them. The dollars accumulated as reserves all over the world...and every central bank raced to keep up. Soon, the exporters were producing too much. The importers were consuming too much. And there was too much money and credit everywhere.
The Japanese economy was the first to blow up - in 1989. The tech sector on Wall Street was next to go - in 1999. Finally, in 2007, the planet-wide bubble popped. Suddenly, the whole world was Japan. And now, every nation in Christendom, to say nothing of the others, is following Law's example. All issue paper gold - in the form of bills, notes, and bonds - as if they were the Banque Royale. Europe is estimated to need $2.2 trillion in deficit funding this year. America will need at least a trillion more. If the depression deepens, maybe $2 trillion. How long can this go on? Where will it lead?
"There are no means of avoiding the final collapse of a boom brought about by credit expansion," wrote Ludwig von Mises. "The alternative is only whether the crisis should come sooner as a result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved."
On Tuesday, the S&P rating agency issued a warning. If Japan continues in the direction it is going, it will have Hell to pay. Japan leads the way into the future. And into a monetary minefield. Her current deficit - a record - is more than her tax revenue. And her public debt is nearly 7 times as great. Her feet grow larger.
No natural life survives the lifecycle. And no paper currency standard has ever survived a complete credit cycle. It is just a matter of time until we hear the explosion and see body parts flying.
Regards,
Bill Bonner,
for The Daily Reckoning
Joel's Note: Addison tells us they're putting the final touches on a collection of Bill's various reckonings from over the past decade, titled "Dice Have No Memory: Big Bets and Bad Faith from Paris to the Pampas." At this stage, we're looking at a March release. Keep a look out for it.
Science and technology have produced many wondrous breakthroughs. But there are some things it cannot improve. A kiss from natural lips is still the lover's choice. Baby formula proved no match for the real thing. Ersatz money is a flop too. That last item is not so much a fact as a prediction.
The first modern competition between gold and paper money ended like the pre-modern ones. Gold won. Herewith, a short summary:
A rogue, John Law, was the protagonist of the story. He killed Beau Wilson in a duel. Then, he went on the lam...first to Scotland...then to Amsterdam...and finally to Paris. Like Alan Greenspan or Ben Bernanke, he made himself useful to people in high places - in this case the Duke d'Orleans, who needed money. Law had a way to get it:
"I have discovered the secret of the philosophers' stone," he is said to have remarked, "it is to make gold out of paper."
We need to look no further. Law may have been good with figures; it was at philosophy that he failed. A thing cannot be both one thing and a different thing at the same time. It is either gold. Or it is paper. Rarity and durability give gold value - as money. Paper's most conspicuous properties are just the opposite - it is common...and has a tendency to curl up and blow away.
Law's new, easy money helped France to an economic recovery - or so it seemed. But in the end, the philosophical error caught up with him. Gold has real value. If you can create it at will, why not create more of it? It was just a matter of time before he had created too much. Soon, there was an angry mob outside Law's office on the Rue Quincampoix. People who held his paper gold had come to see it in a different light. Where once they cherished it as paper gold...now they despised it as nothing but paper.
Law's scheme increased France's money supply - including banknotes and shares in his Mississippi company - by 300%. Prices in Paris doubled between 1718 and 1720. Then, when the new money system began to give way, the Duke d'Orleans "cranked up the printing press." By 1721, Law's money was worthless. "Banque" was a dirty word in France for the next 200 years.
The current experiment with paper money began on the 15th of August 1971. Henceforth, said Richard Nixon, foreign countries that wished to exercise their right to trade US dollars for gold could drop dead. From that point forward, the dollar was worth only what someone would give you for it. Philosophers held their breath. But nothing happened. Many have died since, waiting for the dollar to succumb first. Still, the millstones of monetary history may grind slowly, but the more slowly they grind, the more fingers they pinch.
The new paper money standard allowed for a worldwide credit boom - just as in Paris following the establishment of Law's scheme. The US created dollars. Its citizens spent them. The dollars accumulated as reserves all over the world...and every central bank raced to keep up. Soon, the exporters were producing too much. The importers were consuming too much. And there was too much money and credit everywhere.
The Japanese economy was the first to blow up - in 1989. The tech sector on Wall Street was next to go - in 1999. Finally, in 2007, the planet-wide bubble popped. Suddenly, the whole world was Japan. And now, every nation in Christendom, to say nothing of the others, is following Law's example. All issue paper gold - in the form of bills, notes, and bonds - as if they were the Banque Royale. Europe is estimated to need $2.2 trillion in deficit funding this year. America will need at least a trillion more. If the depression deepens, maybe $2 trillion. How long can this go on? Where will it lead?
"There are no means of avoiding the final collapse of a boom brought about by credit expansion," wrote Ludwig von Mises. "The alternative is only whether the crisis should come sooner as a result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved."
On Tuesday, the S&P rating agency issued a warning. If Japan continues in the direction it is going, it will have Hell to pay. Japan leads the way into the future. And into a monetary minefield. Her current deficit - a record - is more than her tax revenue. And her public debt is nearly 7 times as great. Her feet grow larger.
No natural life survives the lifecycle. And no paper currency standard has ever survived a complete credit cycle. It is just a matter of time until we hear the explosion and see body parts flying.
Regards,
Bill Bonner,
for The Daily Reckoning
Joel's Note: Addison tells us they're putting the final touches on a collection of Bill's various reckonings from over the past decade, titled "Dice Have No Memory: Big Bets and Bad Faith from Paris to the Pampas." At this stage, we're looking at a March release. Keep a look out for it.
Thursday, December 23, 2010
The Religion of Consumerism: Continuing a holiday tradition, even if it’s fiscally imprudent
Joel Bowman
From Buenos Aires, Argentina...
Cricket in the park...beers in the sun...outdoor cafes and pretty girls in summer dresses. We're getting an early jump on the holiday season here at The Daily Reckoning...at least so far as it's conducted south of the equator.
Last year your editor celebrated the occasion with Buddhist friends in the Far East. The year before, with Hindus in Mumbai. And before that, with Muslims in the Middle East. This weekend, we'll have Catholic buddies around for an Argentine asado. We'll drink Malbec and yerba maté and listen to Carlos Gardel belt out some old classics from the rooftop terrace.
That's the wonderful thing about the holiday season. It's a time of year when people of all faiths set aside their differences to worship a common higher purpose: the religion of consumerism. Flocks of all colors and creeds make their annual pilgrimages to consumerism's many temples - sometimes known as "malls" - to prostrate themselves at the discount aisle and to sacrifice the balance of their credit cards. Indeed, people who don't even believe in Jesus Christ or the virgin birth can still be found queuing up for two-for-one tie sales and half- off kitchen appliance clearances. We remember reading somewhere, a highly regarded scientific journal perhaps, that the sound of the collective global credit card swipe around this time of year is audible even in the outer reaches of space.
"But wait a minute," we hear some Fellow Reckoners complain. "Isn't this precisely how we arrived in this mess in the first place? By overspending on junk we didn't need and couldn't afford? Shouldn't we be paying down our debts and practicing some fiscal responsibility?"
Oh bah humbug! Don't be such a Grinch! Nobody likes a stickler for inconvenient facts while the eggnog is still flowing.
Besides, Christmas isn't about spending money we don't have on things we don't need...it's about spending money we don't have on things other people don't need. The net effect might be the same, but at least the soundtrack to financial ruin is a feel-good one.
Christmas is also a time to gather with friends and family and to reflect on the year gone by. Who got married? Who graduated? Which currency narrowly escaped collapse? That sort of thing.
With that in mind, we present the first installment of our 2010 Daily Reckoning "Best Of" Series. Your editors sifted through both the column archives and the reader mail to come up with a selection of essays that, we hope, provide you with some interesting discussion topics for your holiday season family gatherings.
First, let's go back to the beginning...
Way back in January, Bill Bonner penned the following essay, a kind of "ghost of currencies past," if you will. Please enjoy and send your comments to the address below...
Additional articles and commentary from The Daily Reckoning on:
Twitter Facebook DR iPhone APP
If you are you having trouble receiving your Daily Reckoning subscription, you can ensure its arrival in your mailbox by whitelisting the Daily Reckoning.
© 2010-2011 Agora Financial, LLC. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the World Wide Web), in whole or in part, is strictly prohibited without the express written permission of Agora Financial, LLC. 808 Saint Paul Street, Baltimore MD 21202. Nothing in this e-mail should be considered personalized investment advice. A lthough our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice.We expressly forbid our writers from having a financial int erest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation.Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.
From Buenos Aires, Argentina...
Cricket in the park...beers in the sun...outdoor cafes and pretty girls in summer dresses. We're getting an early jump on the holiday season here at The Daily Reckoning...at least so far as it's conducted south of the equator.
Last year your editor celebrated the occasion with Buddhist friends in the Far East. The year before, with Hindus in Mumbai. And before that, with Muslims in the Middle East. This weekend, we'll have Catholic buddies around for an Argentine asado. We'll drink Malbec and yerba maté and listen to Carlos Gardel belt out some old classics from the rooftop terrace.
That's the wonderful thing about the holiday season. It's a time of year when people of all faiths set aside their differences to worship a common higher purpose: the religion of consumerism. Flocks of all colors and creeds make their annual pilgrimages to consumerism's many temples - sometimes known as "malls" - to prostrate themselves at the discount aisle and to sacrifice the balance of their credit cards. Indeed, people who don't even believe in Jesus Christ or the virgin birth can still be found queuing up for two-for-one tie sales and half- off kitchen appliance clearances. We remember reading somewhere, a highly regarded scientific journal perhaps, that the sound of the collective global credit card swipe around this time of year is audible even in the outer reaches of space.
"But wait a minute," we hear some Fellow Reckoners complain. "Isn't this precisely how we arrived in this mess in the first place? By overspending on junk we didn't need and couldn't afford? Shouldn't we be paying down our debts and practicing some fiscal responsibility?"
Oh bah humbug! Don't be such a Grinch! Nobody likes a stickler for inconvenient facts while the eggnog is still flowing.
Besides, Christmas isn't about spending money we don't have on things we don't need...it's about spending money we don't have on things other people don't need. The net effect might be the same, but at least the soundtrack to financial ruin is a feel-good one.
Christmas is also a time to gather with friends and family and to reflect on the year gone by. Who got married? Who graduated? Which currency narrowly escaped collapse? That sort of thing.
With that in mind, we present the first installment of our 2010 Daily Reckoning "Best Of" Series. Your editors sifted through both the column archives and the reader mail to come up with a selection of essays that, we hope, provide you with some interesting discussion topics for your holiday season family gatherings.
First, let's go back to the beginning...
Way back in January, Bill Bonner penned the following essay, a kind of "ghost of currencies past," if you will. Please enjoy and send your comments to the address below...
Additional articles and commentary from The Daily Reckoning on:
Twitter Facebook DR iPhone APP
If you are you having trouble receiving your Daily Reckoning subscription, you can ensure its arrival in your mailbox by whitelisting the Daily Reckoning.
© 2010-2011 Agora Financial, LLC. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the World Wide Web), in whole or in part, is strictly prohibited without the express written permission of Agora Financial, LLC. 808 Saint Paul Street, Baltimore MD 21202. Nothing in this e-mail should be considered personalized investment advice. A lthough our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice.We expressly forbid our writers from having a financial int erest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation.Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.
Friday, December 17, 2010
Delusions of Power: The Effects of Central Banking on Gold and Paper Currencies
Reporting from Laguna Beach, California...by Eric Fry
"When will the gold bubble burst?" CNBC's Larry Kudlow wondered aloud this morning.
A question to which your California editor would reply, "We know what gold is and we know what a financial bubble is, but we don't see any gold bubbles."
Perhaps Kudlow is referring to the fact that the gold price is rising...in response to the Central Banking Bubble. On its face, the idea is ludicrous that one man can steer an entire economy, simply by adjusting one little interest rate. The idea is a doubly ludicrous that one institution can nurture economic growth, simply by printing money. And yet, a nation of investors places its faith in the Cult of Central Banking, as folks like Larry Kudlow pay homage to Ben Bernanke every business day.
So far, the true believers have profited from their faith. It has paid well to embrace this cult and to trust the Delphic utterances of its high priests like Alan Greenspan and Ben Bernanke. But this whole central bank thing is getting a little out of hand.
The early central bankers admitted their fallibility. They would adjust interest rates up or down, depending on the prevailing economic circumstances, then hope for the best. But the more that the central bankers' tinkering and meddling appeared to succeed, the more they tinkered and meddled, and the more they believed in the power of their tinkering and meddling.
Eventually, the central bankers not only believed in the power of their intrusions and manipulations, but also in the wisdom of them. Before long, the central bankers considered their activities to be not merely a responsibility, but an imperative, a social duty; perhaps even a "calling" - a kind of Divine Right of Central Banking.
Armed with these potent delusions, central bankers around the world continue to meddle, day by day, month by month. And the investor-flock continues to trust in their mystical powers. This nearly universal faith in a priesthood of monetary medicine men is an extreme idea...taken to an extreme. It is a bubble - the effects of which are as varied as they are non-quantifiable. But one effect is very clear: currency values are perpetually in decline.
The more the medicine men prescribe their remedies and elixirs, the faster the purchasing power of their paper currencies erodes. Observing this trend, rational, forward-looking investors scout around for assets the central bankers are not trying to protect - assets that require no protection whatsoever. Gold is an obvious choice. It is the timeless choice of all investors who reject the Cult of Central Banking and who, therefore, distrust paper currencies as a store of value.
Gold is rising because Central Banking is in a bubble. But the gold bubble, itself, will not arrive until the Central Banking Bubble bursts - the moment when investors universally spurn the cult of Central banking as heresy, and rebuke central bankers, themselves, as agents of wealth destruction. At that moment, when gold is trading north of $10,000 an ounce...or $20,000...or $100,000, the gold bubble will have arrived. And when it does, we will be there to issue a "sell" recommendation.
Speaking of "sell" recommendations, Jay Shartsis, a seasoned options pro at R.F. Lafferty in Lower Manhattan, warned his clients on Wednesday, "A big stock market decline is coming."
To support his bearish call, Shartsis has highlighted a variety of market signals and sentiment indicators. Late last week, for example, Shartsis noted that the "CBOE equity put/call ratio hit .27 - the lowest in my memory. And now 8 days in a row, this ratio has been sitting below .60 - that's a sell signal."
Then earlier this week, Shartsis observed, "With the stock market near the highs for this move, there are only 127 new highs on the NYSE and 88 new lows. The new lows number is way above where it would be if this market was in good underlying shape. Yesterday saw 3% of all NYSE stocks at new lows - a condition that has happened only 36 times in the past. Two months afterwards, the S&P 500 was lower on 32 of those 36 instances."
Lastly, Shartsis called attention to the nearby chart, as he remarked, "The chart displays the Options Speculation Index. It is a measure of total call buys plus put sales (those are bullish transactions), divided by total put buys plus call sales (bearish transactions). So this is a very comprehensive gauge and it now reflects the most bullish option trader sentiment probably ever recorded. No fear at all. Note that the index is considerably higher than it was before the flash crash last May. A big market decline is coming!"
Shartsis has been wrong before, of course. But he has also been right. We predict he will be one of the two this time around.
"When will the gold bubble burst?" CNBC's Larry Kudlow wondered aloud this morning.
A question to which your California editor would reply, "We know what gold is and we know what a financial bubble is, but we don't see any gold bubbles."
Perhaps Kudlow is referring to the fact that the gold price is rising...in response to the Central Banking Bubble. On its face, the idea is ludicrous that one man can steer an entire economy, simply by adjusting one little interest rate. The idea is a doubly ludicrous that one institution can nurture economic growth, simply by printing money. And yet, a nation of investors places its faith in the Cult of Central Banking, as folks like Larry Kudlow pay homage to Ben Bernanke every business day.
So far, the true believers have profited from their faith. It has paid well to embrace this cult and to trust the Delphic utterances of its high priests like Alan Greenspan and Ben Bernanke. But this whole central bank thing is getting a little out of hand.
The early central bankers admitted their fallibility. They would adjust interest rates up or down, depending on the prevailing economic circumstances, then hope for the best. But the more that the central bankers' tinkering and meddling appeared to succeed, the more they tinkered and meddled, and the more they believed in the power of their tinkering and meddling.
Eventually, the central bankers not only believed in the power of their intrusions and manipulations, but also in the wisdom of them. Before long, the central bankers considered their activities to be not merely a responsibility, but an imperative, a social duty; perhaps even a "calling" - a kind of Divine Right of Central Banking.
Armed with these potent delusions, central bankers around the world continue to meddle, day by day, month by month. And the investor-flock continues to trust in their mystical powers. This nearly universal faith in a priesthood of monetary medicine men is an extreme idea...taken to an extreme. It is a bubble - the effects of which are as varied as they are non-quantifiable. But one effect is very clear: currency values are perpetually in decline.
The more the medicine men prescribe their remedies and elixirs, the faster the purchasing power of their paper currencies erodes. Observing this trend, rational, forward-looking investors scout around for assets the central bankers are not trying to protect - assets that require no protection whatsoever. Gold is an obvious choice. It is the timeless choice of all investors who reject the Cult of Central Banking and who, therefore, distrust paper currencies as a store of value.
Gold is rising because Central Banking is in a bubble. But the gold bubble, itself, will not arrive until the Central Banking Bubble bursts - the moment when investors universally spurn the cult of Central banking as heresy, and rebuke central bankers, themselves, as agents of wealth destruction. At that moment, when gold is trading north of $10,000 an ounce...or $20,000...or $100,000, the gold bubble will have arrived. And when it does, we will be there to issue a "sell" recommendation.
Speaking of "sell" recommendations, Jay Shartsis, a seasoned options pro at R.F. Lafferty in Lower Manhattan, warned his clients on Wednesday, "A big stock market decline is coming."
To support his bearish call, Shartsis has highlighted a variety of market signals and sentiment indicators. Late last week, for example, Shartsis noted that the "CBOE equity put/call ratio hit .27 - the lowest in my memory. And now 8 days in a row, this ratio has been sitting below .60 - that's a sell signal."
Then earlier this week, Shartsis observed, "With the stock market near the highs for this move, there are only 127 new highs on the NYSE and 88 new lows. The new lows number is way above where it would be if this market was in good underlying shape. Yesterday saw 3% of all NYSE stocks at new lows - a condition that has happened only 36 times in the past. Two months afterwards, the S&P 500 was lower on 32 of those 36 instances."
Lastly, Shartsis called attention to the nearby chart, as he remarked, "The chart displays the Options Speculation Index. It is a measure of total call buys plus put sales (those are bullish transactions), divided by total put buys plus call sales (bearish transactions). So this is a very comprehensive gauge and it now reflects the most bullish option trader sentiment probably ever recorded. No fear at all. Note that the index is considerably higher than it was before the flash crash last May. A big market decline is coming!"
Shartsis has been wrong before, of course. But he has also been right. We predict he will be one of the two this time around.
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