Thoughts on Markets

Friday, February 19, 2010

Big, BIG, BIGGER Government - Gold - Silver

Gold and silver hit again at precisely the same time of day last night. Both are trading a bit lower today. The miners are also lower and some may be in good buying range. Be very cautious in buying. The precious metals and mining stocks are still what will save our wealth as the supply of unbacked paper currencies of the world continues to increase.



From The DailyPfennig.com: "Yesterday, I began doing some research on what I've been hearing lately about the only place people can find jobs these days... The Government... Here's what I found... You might think that this has nothing to do with currencies... Well... It does! You see, our Gov't continues to deficit spend... And this is one of the things they spend money on... Building Big Gov't!

The tale of two Americas...
Total nonfarm employment is down 4.6% since January 2007, reflecting a decline of 6.27 million jobs.
Private-sector employment has fallen 5.8% and lost 6.625 million jobs,
Total government employment climbed 1.6% over the past three years and added 355k jobs. The Average salary of the Private sector is $40,000
The Average Salary of the Public Sector is $72,000
The Private sector America has been devastated...
The Public sector America has flourished...

Is this what we, as a country really want? A Government so big, that it pushes down the private sector? That one day, everyone is a Government worker? I don't think so, but then, we have to ask the question as to why this is happening... So... U.S. Government... Why is this happening?

My friend, David Galland, wrote in his most excellent newsletter on Wednesday that: "One of the best terms I've read to describe what's going on in these two Americas is "Detroitification." Coined by Jack McHugh, "Detroitification" is defined as the hollowing out of the private economy to prop up unsustainable government establishments." I ask again... Is this what we, as a country really want? "

Welcome to the land of BIGGER BROTHER. Expect more of the same.

From MineWeb.com:

Gold slips on Fed discount rate announcement

Analysts say sentiment is about neutral at the moment with a firmer dollar and heightened risk aversion vying for dominance

Author: Lewa Pardomuan (Reuters)
Posted: Friday , 19 Feb 2010

SINGAPORE (Reuters) -

Gold dropped more than 1 percent on Friday after the U.S. Federal Reserve said it was raising the interest it charges banks for emergency loans, sending the dollar higher and dimming the appeal of bullion as an alternative investment. Read it HERE.

From MineWeb.com:

WGC GOLD DEMAND TRENDS

Gold demand continuing to rebound, but with a subtle change

The single biggest gold supply-side driver in 2009 was recycled gold, while weaker jewelery and industrial demand were offset by significantly higher levels of investment. There have been interesting shifts between the activities of different subsectors of the "investor" component, however. Read it HERE.

From MineWeb.com:

IMF gold sales - price downturn a "one or two day wonder"

Thoughts on the latest IMF gold sale announcement suggest only a temporary, and small, gold price setback.

Author: Lawrence Williams
Posted: Thursday , 18 Feb 2010

LONDON -

For those few who may have missed the news, but noted a sharp fall overnight in the gold price, the IMF made an after-hours announcement that it was planning to sell the remaining 191.3 tonnes of its 403.3 tonnes of gold on the market - shortly but in an orderly fashion over time so as not to disrupt the gold price. Even so, the announcement led to a fairly sharp marking down of the gold price overnight in the U.S. and on Eastern markets - and this morning the drop continued in Europe pushing gold back down below the $1100 level, but perhaps very briefly. It is too early to assess the longer term impact of the announcement. Read it HERE.

From CBSNews.com:

South Carolina Lawmaker Seeks to Ban Federal Currency

South Carolina Rep. Mike Pitts has introduced legislation that would mandate that gold and silver coins replace federal currency as legal tender in his state.

As the Palmetto Scoop first reported, Pitts, a Republican, introduced legislation this month banning "the unconstitutional substitution of Federal Reserve Notes for silver and gold coin" in South Carolina.

In an interview, Pitts told Hotsheet that he believes that "if the federal government continues to spend money at the rate it's spending money, and if it continues to print money at the rate it's printing money, our economic system is going to collapse." Read it HERE.

From Herald-Mail.com:

Bodies found in IRS building hit by plane

Second body found at Texas office building


AUSTIN, Texas (AP) — A software engineer furious with the Internal Revenue Service launched a suicide attack on the agency Thursday by crashing his small plane into an office building containing nearly 200 IRS employees, setting off a raging fire that sent workers running for their lives.

Emergency crews recovered two bodies from the wreckage. The pilot was presumed dead and one worker in the building had been missing. Austin Fire Department Battalion Chief Palmer Buck declined to discuss the identities of those found, but said Thursday night that authorities had “accounted for everybody.” Read it HERE.

From GATA.com:

Farewell to Emperors

Read it HERE.

Miners from Scottrade.com:

Currencies from Kitco.com:

Here is a SPECULATION that I am interested in at a price around $0.19-$0.20. You can check out the company HERE. They modify manufactured off road buggies and seem to be doing a good job of marketing them. This would be a high demand item were financial times better. This is a speculation or gamble, so be careful on it. Below is a graph on the stock. Note the positive technical indicators at the green arrows. BEWARE, it is a speculation or gamble.

Here are some prices: FVITF 2.15; BYDDF 7.79; SNWT 0.205; Gold up 5.30 to 1113.40; Silver up 0.22 to 16.05; DOW off 19.34 to 10374.61.

Make you investment plans carefully and always consider you risk tolerance. Make your own decisions. Move out in accordance with your plans, commit them to the Lord, and know that He is the One who will provide the results. Often His answer is negative to show us that we do not know the future and to help us grow to people who depend upon Him for results. Always thank Him even when the results are negative. We must learn from our mistakes.

I simply try to show you what I am doing and what my thoughts are on markets. What is fine for me may not be for you. Therefore, this blog should not be considered a recommendation for you or your portfolio.

Best to each, Doug



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