Thoughts on Markets

Wednesday, July 29, 2009

Speak softly and carry a big stick against whom?

My email alert on VGZ yesterday should have put you on track for potential buys. I bought some at 1.64 and 1.63. These are good prices, but we may reach even better prices. The graph read circles show greatly reduced volume and MACD down turn, both mean that from a technical perspective we should expect lower prices in the immediate future. Anything in the 1.50 area, I would consider and excellent buying range.

Hecla Mining is still well above its 200 day moving average. However, the red circles are showing that prices are likely to be lower in the near future. I consider below 3.00 a good buying range. Below 2.60 would be outstanding.
Harmony Gold showed two gaps downward about the beginning of July. The second one was covered on July 20th. The first one (highest red circle) has yet to be covered. One would expect it to be covered before long. A breakthrough above about 9.75 would put HMY on track to fill in the first gap. Around 8.50 would be an outstanding buying range. Indications, as with the other graphs are for lower prices in the immediate future.
DRD Gold is well above its 200 day moving average, but is showing signs of weakness in line with the others. Any price below 7.25 would appear to be an outstanding buy. This one is very near the best buying area we have seen in some time.
The price of the precious metals here in America is dependent to a great extent on the purchasing power of the dollar. The dollar has strengthened a bit recently and move the metals down. Thus, we should expect lower prices for a time. Gold is 929.50 and silver is 13.37 with both on down ticks.

From TownHall.com:

Exploiting Public Ignorance
by Walter E. Williams

How can political commentators, politicians and academics get away with statements like "Reagan budget deficits," "Clinton budget surplus," "Bush budget deficits" or "Obama's tax increases"? The only answer is that they, or the people who believe such statements, are ignorant, conniving or just plain stupid. Article I, Section 7 of the U.S. Constitution reads: "All bills for raising revenue shall originate in the House of Representatives; but the Senate may propose or concur with amendments as on other Bills." A president has no power to raise or lower taxes. He can propose tax measures or veto them but since Congress can ignore presidential proposals and override a presidential veto, it has the ultimate taxing power. The same principle applies to spending. A president cannot spend a dime that Congress does not first appropriate. As such, presidents cannot be held responsible for budget deficits or surpluses. That means that credit for a budget surplus or blame for budget deficits rests on the congressional majority at the time. Read the article HERE.

The masses of American citizenry depends upon the TV entertainers who think of themselves as newscasters. They are actually news interpreters who slant the news according to the presuppositions of the bosses of the media. Therefore, only that which is in concert with the bosses bias is reported and that is slanted in direction of the bias to a great extent. Thus, not only the government schools, but the broad media is doing a great job of dumbing down Americans. Many are totally unaware of this and just accept everything reported as truth without discerning the truth.

From TownHall.com:

Bully Boys: A Brief History of White House Thuggery
by Michelle Malkin

Six months into the Obama administration, it should now be clear to all Americans: Hope and Change came to the White House wrapped in brass knuckles.

Ask the Congressional Budget Office. Last week, President Obama spilled the beans on the "Today Show" that he had met with CBO Director Douglas Elmendorf -- just as the number crunchers were casting ruinous doubt on White House cost-saving claims. Yes, question the timing.

The CBO is supposed to be a neutral scorekeeper -- not a water boy for the White House. But when the meeting failed to stop the CBO from issuing more analysis undercutting the health care savings claims, Obama's budget director Peter Orszag played the heavy. Read it HERE.

From TownHall.com:

Disaster in the Making?
by Thomas Sowell

After many a disappointment with someone, and especially after a disaster, we may be able to look back at numerous clues that should have warned us that the person we trusted did not deserve our trust.

When that person is the President of the United States, the potential for disaster is virtually unlimited.

Many people are rightly worried about what this administration's reckless spending will do to the economy in our time and to our children and grandchildren, to whom a staggering national debt will be passed on. But if the worst that Barack Obama does is ruin the economy, I will breathe a sigh of relief. Read it HERE.

Theodore Roosevelt used his "Speak softly and carry a big stick" policy internationally. Today, we are seeing a similar approach used against Americans. Thank the Lord that some of our states are beginning to intercede between the citizens of the states and the federal government. This is their job under constitutions of the states and the Constitution of These United States. This is absolutely necessary if we are to avoid another confrontation with the present King George. Without this interposition, citizens are at the mercy of the Federal Government which is bullying all citizens and states.

Tongue in check fun from BrassCheck.com: See the video HERE.

From MarketWatch.com:

Jul 29, 2009, 9:26 a.m. EST

Gold falls for second day as oil declines, dollar strengthens

NEW YORK (MarketWatch) -- Gold futures fell Wednesday for a second session, trading below $940 an ounce as a stronger dollar and declining oil prices continued to reduce the metal's appeal as a hedge against a weaker currency and potential inflation.

Also weighing on gold, holdings in the biggest gold exchange-traded fund fell again, indicating weak investment demand for the metal. Crude oil fell for a second day after an industry group reported U.S. inventories rose last week and as data showed June orders for U.S.-made durable goods dropped the most since January. Read it HERE.

From MineWeb.com:

South African gold miners reach wage settlement with mining unions

Wednesday , 29 Jul 2009

The gold mining companies, which are members of the South African Chamber of Mines, AngloGold Ashanti, Gold Fields, Harmony Gold and Rand Uranium signed the 2009 wage agreements with unions representing gold sector employees (National Union of Mineworkers, Solidarity and UASA) bringing to conclusion the 2009 wage negotiations for the Chamber of Mines gold mining sector.

As part of the agreement, the companies will increase salaries for the entry level employees by 10.5%, and by 10% for the other lower category employees. Salaries for Miners and Artisans and Officials will increase by 9%. Read it HERE.

This is good news for our South African miners, such as, DROOY and HMY.

From TodaysFinancialNews.com:

Quote of the Day:

"We are developing our own equivalent of the Chinese state sector through Obama's takeover of General Motors and his insistence on keeping banks that took TARP money on a tight leash. By controlling bank lending (and refusing to let most banks repay the TARP loans) Obama is replicating the Chinese experience. Indeed, as he forces banks to convert the preferred stock he made them give the government to common (and therefore voting) stock, he hastens the day of federal control of the banks and, through them, of the economy."

-- Dick Morris, Newsmax.com

Equivalent of the communistic Chinese state sector. That is scary! Let's pray that God will not long tolerate another Tower of Babel. Pray that He will raise up statesmen at the state level who will shoulder their God-given responsibility of protecting the life, liberty, and property of the citizens. This must daily be our prayer for a lawful, peaceful solution to the present situation.

Best to each, Doug






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