Thoughts on Markets

Friday, July 17, 2009

Draconian Health Care is Proposed

After six days of up moves by the DOW Trans, we are looking at a potential down day. Under the DOW Theory bull or bear trends must be confirmed by both the Transportations and the Industrials. We were waiting for a confirmation of the high by the Industrials on June 1st, and it seemed that the Transportations were about to do it. It looks like not today.

The DOW four days up and now possibly a down day. It is an interesting market.
The miners are following a similar pattern with five days up and now, apparently, a down day. Yesterday was just barely up, so we were forewarned.
Gold appears to be attempting another break through of the 940 barrier, but seems to be capped every time it approaches this Resistance level. Gold is 939.50.
Silver is up a good bit today, but seems to be struggling with 13.40. It is now just above that Resistance level at 13.43.

This morning I put in buy orders on DROOY at a limit of 7.97. It opened with trading at 8.00+. The miners are mixed now. Both gold and silver are moving up, as the dollar is likely down again. Gold is pushing toward 940 which seems to have been the cap price defended by the bullion banks deep pockets. It will be interesting to see if the 940 cap will hold. It is being threatened at present.

An appropriate quote reported in Casey's Daily Resource Plus today: "Interventionism cannot be considered as an economic system destined to stay. It is a method for the transformation of capitalism into socialism by a series of successive steps." - Ludwig von Mises


Swiss banks running out of storage space for gold bullion

Worries about the economy and the success in marketing gold ETFs has seen Swiss banks finding difficulty in meeting secure storage requirements for gold bullion.

Author: Lawrence Williams
Posted: Friday , 17 Jul 2009


In a note entitled No more space for Gold Bars, Swiss news website 20 Minuten Online reports that Swiss banks are running out of secure storage space for gold bullion held by investors and institutions. Fears of hyperinflation, the economic downturn and the success of gold index funds (ETFs), which are supported by physical gold, has led to a run on precious metals investment - and in gold in particular, and in the necessary secure storage space in which to hold it..

One Swiss bank, earlier this year, reported that it was having to relocate some of its stored silver bullion to another site to make room for gold. The Zurich Kantonal bank put this down to the success of its gold ETF. Read it HERE.

The new health care commentary from Investors' Business Daily:

It's Not An Option

Congress: It didn't take long to run into an "uh-oh" moment when reading the House's "health care for all Americans" bill. Right there on Page 16 is a provision making individual private medical insurance illegal.

When we first saw the paragraph Tuesday, just after the 1,018-page document was released, we thought we surely must be misreading it. So we sought help from the House Ways and Means Committee.

It turns out we were right: The provision would indeed outlaw individual private coverage. Under the Orwellian header of "Protecting The Choice To Keep Current Coverage," the "Limitation On New Enrollment" section of the bill clearly states:

"Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day" of the year the legislation becomes law.

So we can all keep our coverage, just as promised — with, of course, exceptions: Those who currently have private individual coverage won't be able to change it. Nor will those who leave a company to work for themselves be free to buy individual plans from private carriers. Read the whole article HERE.

Talk about 1984 and totalitarian government. What else would you expect from the home of the brave and the "free"? Look out, folks, under this plan you can kiss sound health care goodbye, but you will be forced into it by the power of the government. Let's launch a campaign to cancel this plot before it comes to fruition. Write and call your congressmen and senators NOW!

More on the new, "improved" health care from Chuck Butler in The Daily Pfennig: "But 'big government' is back, and the current administration obviously feels it is their job to make government even bigger. Chuck had this to say about this weeks earlier announcement of a new government run health care program:

"The Big Debate right now is a National Health Care program... I'll come right out front and center and say that I'm not for it, which shouldn't surprise anyone that's been reading this letter very long. But there's someone else who should be more important a figure against this than I think the media is reporting...

I'm talking about Douglas Elmendorf, the Director of the Congressional Budget Office who, under questioning by members of the Senate Budget Committee, had this to say...

"Instead of saving the federal government from fiscal catastrophe, the health reform measures being drafted by congressional Democrats would worsen an already bleak budget outlook, increasing deficit projections and driving the nation more deeply into debt."

He went on to say... That "bills crafted by House leaders and the Senate Health Committee do NOT propose the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount." "

Not only are draconian regulations proposed, but the over all program is another budget busting spending deal by our congress.


Foreclosure Filings in U.S. Reach Record 1.5 Million

July 16 (Bloomberg) -- U.S. foreclosure filings hit a record in the first half, a sign that job losses and falling property prices deepened the housing recession, according to RealtyTrac Inc.

More than 1.5 million properties received a default or auction notice or were seized by banks in the six months through June, the Irvine, California-based seller of default data said today in a statement. That’s a 15 percent increase from the year earlier. One in 84 U.S. households received a filing. Read it HERE.

Isn't it nice that the recession, depression is over as reported by the rose colored eye glasses of many? Here is another indication that clear eyeglasses are needed by them.


There's Nothing Left to Recover

What Economy?


There is no economy left to recover. The US manufacturing economy was lost to off shoring and free trade ideology. It was replaced by a mythical “New Economy.”

The “New Economy” was based on services. Its artificial life was fed by the Federal Reserve’s artificially low interest rates, which produced a real estate bubble, and by “free market” financial deregulation, which unleashed financial gangsters to new heights of debt leverage and fraudulent financial products.

The real economy was traded away for a make-believe economy. When the make-believe economy collapsed, Americans’ wealth in their real estate, pensions, and savings collapsed dramatically while their jobs disappeared.

The debt economy caused Americans to leverage their assets. They refinanced their homes and spent the equity. They maxed out numerous credit cards. They worked as many jobs as they could find. Debt expansion and multiple family incomes kept the economy going. Read the article HERE.

The debt economy may be gone forever. One would hope so. However, recovery in the minds of many is that we return to the economy which existed before the housing bubble burst. Be careful what you wishes are. Were we to return to that, we would soon be in the same financial quick sand of the last two years. Is that what we want? The new economy when/if it comes will be different. We have lost our manufacturing capability and are predominantly a service economy. I still believe that our standard of living will diminish greatly. How can we put people back to work? Of course, with the expansion of the government, there will be many employed unproductively in the monster. Government never produces prosperity for the masses. Only the free market private businesses can produce any wealth.

Rest the Lord, but be active in following His will. His way leads to life, others to death. He is the Messiah, not our government. God's basic unit of society is the family. Thus, there is a governmental war on the family. Beware of this as you submit your children to the government schools which present much against the strong Christian family in an attempt to produce robot like people who will want to be dependent upon the government as their messiah.

Best to each, Doug


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