Updated June 27, 2008
June 27, 2008 we have seen
more downward pressure and the long term outlook remains negative. Extremely
dangerous is that all the actual downward momentum is happening without any
noticeable upwards pressure of
interest rates. However,
we come close to a point where the general level of interest will rise.
As explained by
Ludwig von Mises, there
is no other solution.
Once interest rates start to rise, they will break the
back of what is left of the
Real Estate, Stock and Bond markets.
Be aware that few investment vehicles are able
to withstand and even rise in conjunction with higher interest rates. High time
to find out which ones are.
The Dow made a peak in 1966. It made
little progress for about 15 years, so that in 1980 it was just about where it
was in 1966, roughly around 1,000. Gold, on the other hand, rose from a
low of $35 all the way to $850. This means that strong inflation during the
period kept the Dow from falling, so it did not fall as it did during the
Great Depression. On the other hand, inflation powered the price of gold about
25-fold. In this scenario, we should expect the Dow to remain range-bound in the
10,000-15,000 range. Then, a gold forecast of 10,000 is perfectly realistic.
Applied to the Standard and Poors-500 below, this would mean a sideward trading
range from 1400 to 800 for a gold forecast of 10,000.
Updated July 15, 2008
As of July 15, it looks like all
markets have entered an oversold territory and that we are about to see a B
up-leg of the ABC down formation. This correction should be used wisely and we
advise urgently to adjust the structure of your savings. Time to talk to
somebody that really knows what he is doing. Don't be mistaken, this is a
paradigm shift. Fortunes will be made and fortunes will be lost. The weakness
and the late warnings issued by the financial sector tells a book. The Garage
Sale ain't over yet!
As of June 26, 2008, we had a
Hindenburg Omen. “The rationale behind the indicator is that, under normal
conditions, either a substantial number of stocks establish new annual highs or
a large number set new lows — but not both.” When both new highs and new lows
are large, “it indicates the market is undergoing a period of extreme
divergence — many stocks establishing new highs and many setting new lows as
well. Such divergence is not usually conducive to future rising prices.
Last year, many Stock market
indexes had retraced all the way to their pre 911 crash levels. Technically, we
had come to a point where either they break out on the upside or come down and
confirm the 2000/2001 top. Amazing is that nobody was crying ‘Wolf’ when
we had landed in a position where and Double
Tops and Overbought markets could ignite a fresh down leg.
CREDIT CRUNCH (see
under CDO’s and subprime)
and the associated
garage sale is far from over. As of July 16, 2008 we have
seen the confirmation that unless we enter a
Weimar situation (Zimbabwe),
the markets are to come down a lot more after the actual correction.
September 11, 2008
|The puzzle of overbought Dollars and oversold
Gold starts to fall into place. Authorities will have no
alternate but to massively start to monetize the Debt in a Weimar/Zimbabwe
decline could shock mainstream analysts:
expecting a crash-like decline in stocks sometime over the next four to six
weeks, starting at any time. Maybe now, maybe in a month, maybe two. Things are
unraveling fast. Declines are five waves, and rallies are three (corrective),
volume is up on declines, and shrinks on rallies, and we continue to get lower
highs. What we are expecting pretty soon is lower lows. This
coming equity decline should alert the Master Planners that a massive stimulus
and hyperinflation policy should start yesterday, and that stimulus should be
the catalyst for a turnaround in precious metals, commodities.
click here to read this very important
September 4, 2008
The Dow Jones fell through a
double bottom and confirms our skepticism about the markets. Hopefully our
readers have - as we advised on several occasions - used this past summer to
reorganize their portfolio.
Brace for weak European and US
markets over the coming next weeks.
Over the last weeks, we warned the
major indexes were moving into a Bearish Rising wedge towards their long
term trend lines. The bearish trendline held and today the Dow fell through a
double bottom. Next objective is 10,850. However, as this
is probably the second down wave,
we expect to see much lower levels!
Posted August 15 and updated September 12, 2008
Gold, Silver, Oil, Euro and
Commodities are oversold but Stock Markets and Financials start to be
overbought. Both the Dow Jones industrials and the SP500 show dangerous
rising wedges and falling participation. European Stock market indexes as the
German DAX, French CAC, and others show similar patterns! As explained earlier,
we have lower tops and lower bottoms or Secular Bear Trends for most Stock
markets and stocks. Watch out as the actual up correction for most stock
markets could come to an end during the coming weeks. Use the friendly markets
to reposition your investments.
The Presidential Elections and the last act - short
Now that the Dollar is at a 12 month high,
Oil, Gold & Silver and commodities are way down; the only missing part of
the Election puzzle is a better looking stock market. An unexpected cut
in Fed rates next Tuesday would fill the gap, propel the Dow Jones to
a level of 12,200 and paint higher pre-election markets.
This would postpone the next down leg of the world stock markets.
Tuesday September 16, 2008 is the day to watch! With World Stock markets
breaking down, the FED has not been staying ahead of the game.
The Dow had a Bearish Triangle breakdown on
Monday 15/9. A violation of 10.850 will open the door to much lower
October 19, 2008 there is clear
evidence that this time there are no cheering Stock markets preceding the
upcoming Presidential Elections. Our prediction of
just weeks ago in "CRASH" was extremely accurate.
trading after 17% share price fall -
Catherine Belton and Charles Clover in Moscow and Rachel Morarjee in London
Russian shares suffered their steepest one-day fall in
more than a decade on Tuesday, losing up to 20 per cent, as a sharp slide in
oil prices and difficult money market conditions triggered a rush to sell. The
heads of the Russian central bank, the finance ministry and the financial
market regulator met on Tuesday night for an emergency discussion on ways to
halt the crisis.
Click here for more…
The structure of the US economy today is
far weaker than it was in the fall of 1929.
Years of reckless consumer
borrowing and spending, and enormous trade and budget deficits have resulted
in a hollowed out industrial base and an unmanageable mountain of debt owed to
foreign creditors. Instead of the support of a strong currency backed by gold,
the public now must deal with a modern Fed free to print as much money as
politicians want. So rather than getting the benefits of falling consumer
prices (as happened during the Depression), consumers today will contend with
much higher consumer prices, even as the economy contracts.
Goldonomic, Florida, USA -