No More Free Markets - UK & US Following Same Path

I was indisposed this morning getting the Durango checked out before expiration of the Warranty Policy. Nothing much wrong, but it took almost four hours for the thorough check out. Will have to have the ball joints repaired, but that is covered, so I am pleased.

The Lord has really blessed our nation, but we, as a nation, have turned our backs on God and His law. We were once a nation under law which was written while the predominate influence among the colonies came from the Bible. Thus, the Bible and God's law was the major influence in the law foundation of America. However, I heard some of the remarks of President Obama at the installation of the new Attorney General of these United States.

Here are two direct quotes: "Translate laws into justice." and "Laws reflect the reality of every day life." The implication was that laws must be changed to fit man's view of justice and man's reflection of reality. Thus, we are to be no longer bound by the decrees of the Creator God.

Man is to become the god defining what is good and evil. I think I recall that this was the cause of the original sin of Adam and Eve, as they desired to be as God when Satan deceived Eve and Adam willingly joined in. No wonder that God is displeased with America. He knows that this is the trend in our nation. By the way, Obama is not our first president to ignore the validity of God's law. He is simply continuing the precidence that was established at least a century ago.

Where are the Christians who should be shouting from the roof tops against this sacralege. It is an abomination to God. We need Christian MEN who will stand for God and call out to governmental officials. "Thus, sayeth the Lord." Let us join together in doing this in spite of the boos and hisses which will rise from the general public. Let us again be the light of the world and salt of the earth.

Gold has been "gently" pushed downward. It is currently at 920 off 14.20 and silver is 13.26 off 0.26. They are tracing the same pattern on the charts.
GLD ( proxy for gold) has broken through the 50 day moving average. This is not a good sign, but the trend remains very bullish, particularly, in view of the poor economy and the weakness of the dollar and other paper currencies. By the way, the Norwegean Krone seems to be one of the strongest currencies at present.
Notice that the miners are well above the 50 day moving average. They are holding well and making a better showing than the precious metals at this time. We may be later in the bull market for precious metals than most realize. This break between the metals and the mining stocks generally comes to fruition in the latter phases of the precious metals bull market. Our trading stocks are holding well, as we can see >>> DROOY 8.43; HL 2.08; HMY 11.23, and VGZ 2.14. I was stopped out on some shares of HL and VGZ, and have Good Til Canceled buy orders in for both at 1.75 just in case they drop that low. I will be a buyer of both at 1.80, and would like to add to DROOY at near 8. Perhaps, this is wishful thinking, but I want to buy if we get in that range before long.

Move on the failed sale of UK Treasuries compared to US from The Daily Pfennig:

"Both the UK and US have been flooding their economies with liquidity, by purchasing their own debt. These moves are inflationary, and while we haven't seen signs of any uptick in US CPI, the UK inflation rate unexpectedly rose to 3.2% in February. An ominous sign for the US economy. And by purchasing their own debt and forcing down interest rates below what the market is demanding, the UK and US governments are pushing foreign investors away from the debt sales. This is one reason the failure of the Gilt auction which I wrote about yesterday is of so much concern to the US. We rely on foreign investment in order to finance our deficits, but at the same time we are trying to force interest rates at which these bonds are being sold to below what the market is demanding. This can't continue, and results in failed bond auctions. The solution? The currencies of the US and UK will decline and interest rates will move back up in order to lure back foreign investors. This is inevitable, as the only way we can continue to run deficits while keeping interest rates low is to inflate our economies, which decreases the value of our currency."

Folks, This is the real threat to our economy. If we cannot get "them" to buy "our" debt, we are bankrupt. Of course, this could be a blessing IF the Federal Government does not blame us for the debacle and tax us out of existence. Ominously, there is a growing fear among them about continuing to hold U.S. dollars. How do you feel about holding them as the sentiment toward them dwindles? That is scary.

From Financial Times:

Swiss banks ban top executive travel

By Richard Milne in Geneva

Published: March 26 2009 19:08 | Last updated: March 26 2009 19:08

Switzerland’s private banks have started to ban their top executives from travelling abroad, even to neighbouring France and Germany, because of fears they will be detained as part of a global crackdown on bank secrecy.

The head of one leading private bank in Geneva said the growing determination of countries such as the US and Germany to tackle tax evasion and secrecy meant banks felt they had to take extra measures to protect employees. “Some banks have taken this precaution,” he said. “If today I go to Germany to visit two banks I deal with...German customs can take me in and question me.”

Read the article HERE.

We are on the attack to undermine bank secrecy. Isn't that a great way for a "free" nation to honor its job of protecting the life, liberty, and property of its people. Would that we would return to a Godly free society. Fat chance of that in these days without a miraculous intervention by God, Himself.

Here is an attack upon Britain's Prime Minister in Parliament by Daniel Hannan: View it HERE.

This really lays it on the line. It is a sound attack based upon sound economics. We need the same here and much earlier to the second Bush. We should clap loudly and raise our voices with a great Amen!

Frank Partnoy on derivatives over Public Broadcasting:

Frank Partnoy: Derivative Dangers

Years before the current economic crisis, law professor and former Wall Street trader Frank Partnoy was warning about the dangers of risky financial practices.

In his 1997 book FIASCO: Blood in the Water on Wall Street, Partnoy detailed how derivatives — financial instruments whose value is determined by another security — were being used and abused by big financial firms. Partnoy used his experiences as a derivatives trader at Morgan Stanley to give the book an insider's perspective. In the preface to FIASCO, Partnoy wrote about the growing influence of derivatives: You can read the article and watch the 39+ video HERE.

This is a good introduction to derivatives and the fiasco their abuse brought to us.

From Casey's Daily Resource Plus on the strange activity of the market:

"Talking about the Dow's Wednesday 'last-hour rescue rally at 3:00 p.m.'...how about the Dow's Thursday 'last-hour rescue rally' at precisely the same time!!! As for gold and silver...with options expiry out of the way...who the hell knows. Something seems to be afoot...but with the U.S. government up to its neck in market management these days...it's anyone's guess. And...if I said for sure one way or another...then I'd be guessing too."

It is no wonder that Richard Russell and virtually all analyst of the markets are having great challenges in defining explicitly the direction of the financial markets. These, as well as almost all markets are far from being free. We are living in a controlled market economy these days, and it seems destined to get much worse.

A free market and limited government would solve most of our problems. These are both guide lines for sound government laid down for us by God.

Best to each, Doug