Thoughts on Markets

Wednesday, October 13, 2010

Gold - Silver - Dollar - SILA - Currencies - Bonds

The US has proven to be a poor steward of the reserve currency of the world. We have violated God's Law against use of unequal weights. 

God says, "Thou shalt not have in the bag divers weights a great and a small. Thou shalt not have in thy house divers measures, a great and a small. But thou shalt have a perfect and just weight, a perfect and just measure shalt thou have that thy days may be lengthened in the land which the Lord thy God giveth thee: For all that do such things, and all that do unrighteously, are an abomination unto the Lord thy God. " (Deu. 25:13-16)

Whether people or nations accept the word of God and apply it in their lives is very important. Things which are an abomination to God are not long tolerated and the wrath of His judgment will fall upon those who violate His word. God always balances the books in the end. Of this, there is no doubt. Do not ignore this.


Thomas Sowell
Government Greed
Those who are always accusing people in the private sector of "greed" almost never accuse government of greed, no matter what it does. Indeed, the question of whether the government is greedy almost never comes up, so most of us probably never think about it.
The first time I was forced to think about it was some years ago, when a bank notified me that the government was about to seize a bank account of mine, unless I took action. Since I didn't owe the government any money, and was not accused of any crime, I was baffled.
What had happened was that I had received a private grant to help finance international travel in connection with my research into racial and cultural issues in countries around the world. Since the money was not for my personal use, I opened a separate bank account to hold that money until I was ready to go overseas. Greed and lust go hand in hand. Lust is one of the Ten Commandments which must be obeyed by individuals and government. HERE.


Walter E. Williams
Invisible Victims
The National Transportation Safety Board has again recommended that airlines require a separate seat for all children, regardless of age, eliminating the current practice of permitting children under the age of 2 to fly for free on the lap of a parent. Will mandating child restraint systems make air travel safer? The answer is probably yes but that's the visible.

Having to purchase an extra airplane ticket, some families will opt to drive to their destination instead. Thus, mandated CRS will force some families to switch to a less safe method of travel and some highway fatalities will represent the invisible victims of NTSB policy. By the way, if parents wanted a greater measure of safety for their infant, it's available to them right now. They can purchase a seat and seat restraint for their infant. More intrusion into our lives. This government does very often without improving our lives. HERE.

Podcast from

Gold's current fundamentals - Nic Brown, Head of Commodities Research Natixis
"There is the potential for a substantial correction in gold prices - when it's going to start - very difficult to tell" When is the big question and we are not privy to timing which remains in the hands of our King Jesus. It could also be if. More folks, banks, and large funds are becoming more well known and desired to preserve wealth. Watch the dollar, as I believe it is key to the price of gold, particularly here in America.  HERE.


Junior miners budding supernovas
The world is seeing strong commodity demand and junior resource companies offer the greatest leverage to increased demand and rising prices. This is without a doubt true. In the gold rush, one will bet the biggest bang for the buck with the good minors. HERE.

More on China's movement away from the dollar from The Daily Pfenning ( this morning: "Yesterday, I talked to you about how China was gaining a wider acceptance of their currency and removing the dollar from trading agreements... Well, Ty showed me a story from the Wall Street Journal with a story about how Turkey and China had signed a trade agreement that would, from now on, only use their currencies in the trade, thus excluding the dollar.

Let's see now... China has signed up almost all of Asia, Belarus, Argentina, Brazil and now Turkey... All of these countries only use their currencies in trade, and no longer need dollars... Let me make certain that you understand what's happening folks...

The Chinese are taking steps to become the next reserve currency... And when that happens, things here in the U.S. will change drastically... Just ask anyone that lived in the U.K. after WWII, and the sterling was no longer the world's reserve currency... Don't blame the Chinese, either... The Chinese are only doing this to protect themselves from all their exposure to the dollar. The U.S. has brought this on with all its deficit spending, and you could sprinkle in, protectionism measures, and a host of other things that have built up against the dollar in the past decade, like bubbles, Corporate scandals, etc. Folks, this seems to be the Chinese design and it is moving forward. However, timing is in question. Currently, there does not seem to be enough liquidity in any currency to be a reserve except the US Dollar. The depreciation of the US Dollar is becoming more of an international issue and concern. Thus, the movement away from a reserve dollar is gathering steam. When/if that happens, we will be in deep economic problem with prices rising all around us.

There is more hype today on Gold American Mining from a newsletter attempting to sell itself. Thus, there must be a vested interest. This, seems to me to be a wild eyed speculation, but I have taken positions in it. I emphasize SPECULATION. It may not be correct for you. Buyer Beware is always the watch phrase and I urge you to make your own decisions. Here is the graph:

Gold and silver are moving upward again as the dollar goes down. Here are the graphs:
Miners from

Currencies from

Some Prices: FVITF 3.32 (Sprinting again); SILA 0.85 ( I bought at 0.88 and 0.78); BULM 1.10 (I bought at 1.11 and 1.12); TLT 102.58 (Bonds off); DOW up 72 to 11091+; SPX up 6.34 to 1175.9; Gold up 16.70 to 1367.40; Silver up 0.36 to 23.67.

King Jesus seems to be giving us another up day on markets. Gold seems headed for another high.  Keep your focus upon Him for life and peace.

Best to each, Doug


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