What You Ought To Know About The Upcoming Gold Rally. This Is Incredible.
According to a consultancy out of London you should sell your Gold and seriously consider buying some Twitter stock(see the article below).
“Gold prices have probably peaked this year and could sink to their lowest since 2010 at $1,100 an ounce as the U.S. economic recovery gathers pace, consultancy Metals Focus said on Wednesday.”
Yeah, the US economic recovery gathers pace as it goes right over a cliff.
Here is what I believe to be the best way to look at Gold and it’s price. Forget about the fundamental factors such as supply/demand and geopolitical events. From our vantage point, Gold’s technical/structural setup is identical to the one in 2007 when Gold went from $600 to $1,800 an ounce.
With our mathematical and timing work predicting a severe bear market between 2014-2017, the FED will have no choice but to introduce further stimulus in order to try and re-inflate our markets and the economy. When that happens, I would expect Gold to be surging higher, not setting new lows. In fact, I continue to believe that Gold will be one of the better investments out there over the next 3-5 years.
All you have to do now is wait for Gold to break out above $1,420 and we should be off to the races. Be patient now. Our timing work shows that the next stage of the bull market in Gold is just around the corner as it will be surging higher by around this time next year. If you would like more precise timing please Click Here. 
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What You Ought To Know About The Upcoming Gold Rally. This Is Incredible. Google
Reuters: Gold likely to reach four-year low in 2014 – consultancy
LONDON (Reuters) – Gold prices have probably peaked this year and could sink to their lowest since 2010 at $1,100 an ounce as the U.S. economic recovery gathers pace, consultancy Metals Focus said on Wednesday.
Weakness is likely to set in after an impressive start to the year, it said, when gold rallied to six-month highs. But a replay of last year’s 28 percent plunge, triggered by the U.S. Federal Reserve’s tapering of extraordinary stimulus measures, is not on the cards.
The consultancy also forecast that an eventual easing of tensions in Ukraine would add to a bearish trajectory for the market.
“In the short term, the U.S. recovery regaining momentum (thanks to improving weather conditions) and the eventual de-escalation in Ukraine are likely catalysts for lower prices,” it said in its Gold and Silver Mining Focus 2014.
“Meanwhile, the Fed’s ongoing reduction in its bond purchases, easing concerns about fiscal situations on both sides of the Atlantic and low inflation are all headwinds for the yellow metal for the rest of 2014.”
Robust demand from the major physical gold markets in Asia should help offset Western investors’ lingering caution in gold futures, derivatives and exchange-traded funds.
Chinese demand, which surged last year as prices fell, will remain strong, it said, though below the 2013 level. That, along with strength in retail demand in Western markets, helped drive a 35 percent surge in physical investment last year to 47.1 million ounces.
Jewellery consumption also rose 22 percent to 81.7 million ounces, while the volume of scrap gold returned to the market fell 26 percent to 39.3 million ounces.
That helped offset a 5 percent rise in output from gold mines to 96.7 million ounces, resulting in a 21.8 tonne structural deficit in the market last year, Metals Focus said.
That does not include outflows from bullion-backed exchange-traded funds (ETFs), however, which according to Reuters data totalled 26.354 million ounces last year. The strength of ETF outflows was a major weight on prices in 2013.
“Given plenty of above-ground inventory, other than a temporary shortage of kilobars in Q2, the gold market remained well supplied last year,” Metals Focus said. “Moreover, it is of note that ‘Western’ investors tend to set the price, while physical markets react to it.”
The consultancy expects silver prices to average just under $20 an ounce this year, not far from current levels but well below last year’s average of around $23.80 an ounce, as its fundamentals weaken.
“Global supply is expected to rise by around 2 percent, compared with a 4 percent drop in world silver demand,” it said. “The most significant change … is expected in physical investment, which is forecast to drop 11 percent.”
NATO Continues To Push For Conflict Escalation. How Long Before Russia Retaliates?
Imagine for a second what would happen if either Russia or China announced plans to open up a massive military base in Tijuana, Mexico to protect Mexican farmers against American imperial forces (or some other form of nonsense).
Certainly the US would respond with a massive show of force to prevent having a massive military build up right on it’s border. Yet, apparently this simple notion is incredibly hard for the Obama Administration to comprehend as NATO considers a massive and permanent troop buildup in Eastern Europe (see the article below).
Of course, as they do the chances of an all out military conflict with Russia escalate. I beginning to believe that this might be exactly what they want. Well, that and keeping the Military Industrial Complex working overtime. Defense Panel Chair: Russia’s Actions Mean US Should Keep War-Funding Budget A sad state of affairs.
I am just wondering how long before all Russians are classified as insurgents and terrorists by the Western Media.
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NATO Continues To Push For Conflict Escalation. How Long Before Russia Retaliates? Google
Reuters Writes: NATO commander says must consider permanent troops in Eastern Europe
OTTAWA (Reuters) – NATO will have to consider permanently stationing troops in parts of Eastern Europe as a result of the increased tension between Russia and Ukraine, the alliance’s top military commander said on Tuesday.
NATO has arranged a number of short-term army, air force and naval rotations in Eastern Europe, including the Baltic republics, Poland and Romania, but these are due to finish at the end of this year.
Asked whether NATO might have to look at permanently stationing troops in the alliance’s member states in Eastern Europe, U.S. Air Force General Philip Breedlove said: “I think this is something we have to consider and we will tee this up for discussion through the leaderships of our nations to see where that leads.”
NATO leaders are due to hold a summit in Wales in early September.
In the run-up to the summit, NATO commanders, defense ministers and foreign ministers would look at “tougher questions” about whether the alliance had the right footprint in Europe, Breedlove told a news conference in Ottawa.
“We need to look at our responsiveness, our readiness and then our positioning of forces to be able to address this new paradigm that we have seen demonstrated in Crimea and now on the eastern border of Ukraine,” he said.
Breedlove, who said on Monday he did not think Moscow would send troops into eastern Ukraine, stressed the steps that NATO had taken so far were designed to support eastern members of the alliance.
“We are taking measures that should be very easily discerned as being defensive in nature. This is about assuring our allies, not provoking Russia, and we are communicating that at every level,” he said.
Breedlove insisted the so-called U.S. strategic “pivot” toward Asia would have no effect on its commitment to NATO and collective defense, though he acknowledged that U.S. troop levels in Europe have been reduced by about three-quarters from Cold War levels.
Asked if the U.S. troop levels would be enough in light of the Russian moves, he said: “In our own country now, and I think in every other NATO nation, based on the paradigm that we see that Russia has presented in Crimea and on the border of Ukraine … we are all going to have to reevaluate some of the decisions that have been made (after the end of the Cold War).”
Breedlove declined to say whether he thought that France should scrap the sale of two Mistral helicopter-carrier frigates to Russia, saying this was “a national decision” that was up to France. Moscow has said it would demand compensation if this took place.
Daily Stock Market Update. May 6th, 2014. InvestWithAlex.com
A down day with the Dow Jones down 129 points (-0.78%) and the Nasdaq down 57 points (-1.38%).
Is “Sell In May & Go Away” starting to play out already? While it’s too soon to tell, here is one thing that might keep you up at night. The Dow might be in process of completing the right shoulder of a textbook “Head and Shoulders” trading pattern. With the Dow being unable to set a new high in it’s recent rally, April 4th remains the top of the “Head”.
Should the Dow accelerate to the downside and break below 16,000, it would signal the completion of a pattern and trend reversal. More importantly, it would give us an ominous sign that the bull market that started in 2009 might be over. No doubt a complex setup. Yet, if you look at the subject matter from a timing perspective, things tend to clear up.
Once again, based on our mathematical and timing work the bear market of 2014-2017 is just around the corner.When it starts it will very quickly retrace most of the gains accrued over the last few years. If you would be interested in learning exactly when the bear market will start (to the day) and its subsequent internal composition, please CLICK HERE
(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here).
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The Shocking Truth Behind The Bond Market Conundrum Explained
We have been overwhelmingly bullish on bonds since the beginning of the year. The bet that has paid off big time thus far. While most market participants expect the rates to rise, we disagree with their view. Here is why…
- Our mathematical and timing work predicts a severe bear market between 2014-2017 As it unfolds, it will push the US Economy into a severe recession.To avoid further collapse the FED will have no other choice but to introduce further stimulus into the economy. Driving the rates lower.
- Based on our in depth study of financial markets, secular bull/bear markets rarely end in a V shape fashion. Typically, there are longer term double or triple bottoms/tops. Bond yields have been going down for 30 years. I continue to believe that it is wrong to assume that they will simply bottom in 2012-2013 to start their bull market. At least a double bottom is highly probable.
That double bottom should coincide with the recession discussed in point #1. In fact, I wouldn’t be surprised to see the 10-Year Note at around 1.5%. Making it one of the best investment opportunities in today’s market.
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Talking Numbers: Think the bond rally is over? Think again.
Few things are weirder right now than the bond market.
The Federal Reserve continues to taper its bond-buying program as the official unemployment rate ticks down. That should mean higher interest rates.
But lots of other things are happening. For example, though the unemployment rate is at 6.3 percent, the labor participation rate is the worst it has been in over three decades. Tensions on the Ukraine-Russia border and data showing China’s manufacturing contracting have sent investors fleeing to the safety of U.S. bonds. That should mean lower interest rates.
This tug-of-war in the bond market has kept rates in a relatively tight range for much of the year. In fact, the yield on the benchmark U.S. 10-Year Treasury Note has stayed between 2.6 and 2.8 percent since February. It wasn’t long ago when a 20 basis-point move was just another humdrum week in the market.
While the 10-Year’s yield dipped below 2.6 percent briefly in the past couple of days, Chantico Global founder Gina Sanchez said, investors shouldn’t expect rates to stay this low indefinitely.
“I don’t think that we can really support going well below 2.6 percent,” said Sanchez, “only because bonds at these levels are really expensive.”
The only way for interest rates to go lower would be for economic expectations to sour, according to Sanchez, a CNBC contributor.
“That’s really not what’s happening,” Sanchez said. “Although it’s not a dramatic recovery, it is still a recovery. We are still seeing a fall in unemployment rates. There are still issues out there but we are actually seeing the consumer come back to life. So, I think that it doesn’t make any sense to have rates down below here. I think that this is an anomaly and it’s a selling opportunity.”
However, Richard Ross, global technical strategist at Auerbach Grayson, says interest rates will be moving lower.
Ross notes the 10-Year has been trading as a “range within a range.” While it has stayed roughly between 2.6 and 2.8 for the past three months, the larger range has been between 2.5 and 3.0 percent over the course of nearly a year. Ross’ short-term chart of the 10-Year Treasury shows resistance at a yield around 2.72 percent, its 200-day moving average.
But on a longer-term chart, Ross sees rates as having made a “bearish double top” and headed down to test its 200-week moving average. “That comes in at around 2.40” percent, said Ross. “I am bearish on equities … and I think that plays right into bullish play on bonds, meaning prices go higher, rates move lower. Look for a test of that 2.40 [percent] to coincide with a bigger pullback in the equity market.”
Investment Grin Of The Day
Why The FED Will Tighten This Market To Oblivion
While the market, at least for the time being, sees today’s FED tightening as a sign of strong future economic growth, it is a grave misconception. Richard Fisher, president of the Federal Reserve Bank of Dallas states….
“I personally expect us to end that program in October,” Fisher said. “And then we have to see how the economy is doing, including these broader measures of unemployment, and where we stand, before we can talk about how we might move the short-term rate.”
I can tell you one thing, by the time they finish tightening in October it will be too late to save this market from it’s bear leg and this economy from a severe recession. It was this sort of backwards thinking that set off the 2008 crisis as well. Don’t get me wrong, I hate the QE and other stimulus as much as any other rational investor, yet tightening now is equivalent to financial suicide.
With the stock market being at an unsustainable (bubble) level and with the large chunk of the economy relying entirely on FED financing, massive liquidity and speculating, any tightening would not only slow the economy down, it will bring it to a screeching halt.
These developments are further confirmed by our mathematical and timing work. Again, our work shows a severe bear market between 2014-2017. When it starts it will very quickly retrace most of the gains accrued over the last few years. If you would be interested in learning exactly when the bear market will start (to the day) and its subsequent internal composition, please CLICK HERE
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Bloomberg: Fed’s Fisher Says Economy Strengthening as Payrolls Rise
The U.S. economy is “moving in the right direction” and “getting stronger” as private-sector payrolls increase, saidRichard Fisher, president of the Federal Reserve Bank of Dallas.
“The private sector is beginning to hire,” said Fisher, a voting member of the central bank’s policy committee, said today on the Fox News program ’’Sunday Morning Futures.’’ “We’d like to see that continue and, in fact, increase.”
Employers added 288,000 jobs in April, the biggest monthly gain in two years, the Labor Department reported May 2. At the same time, more than 800,000 people abandoned the labor force and the share of working-age Americans in a job or looking for one fell to a 36-year low.
“We’re continuing to see job creation,” and people who want jobs “will start looking for work, join the workforce, be hired, as business expands in the United States,” Fisher said.
Fisher has said the labor market has been hindered by a shortage of trained workers. The latest Fed Beige Book review of economic conditions highlighted the pinch, with employers in six of 12 districts — Dallas, New York, Cleveland, Richmond, Chicago and Kansas City — reporting difficulty finding skilled workers.
In most areas around the nation, “there are jobs available in certain high-skilled areas, but we don’t have the educational basis for it or we don’t have the immigrant pool for it, or whatever it may be,” Fisher said today.
“There is a skills mismatch; that’s part of the problem,” he said.
Paring Buying
After accumulating assets to shore up the U.S. economy following the 2008 financial collapse, the Federal Reserve this year began paring bond buys amid improved job growth and household spending. As of last month, the Fed held almost $4.3 trillion in assets, a record.
Since December, policy makers have reduced their monthly purchases four times, in $10 billion increments, to $45 billion. The central bank is on course to wind down the stimulus by the end of the year and is likely to hold the benchmark interest rate near zero for a “considerable time” after that, according to an April 30 statement from the Federal Open Market Committee.
“I personally expect us to end that program in October,” Fisher said. “And then we have to see how the economy is doing, including these broader measures of unemployment, and where we stand, before we can talk about how we might move the short-term rate.”
Fisher last month warned that investors might be taking on excessive risk.
U.S. credit markets are “awash in liquidity” and potentially unsustainable stock-market valuations and bond yields “give rise to caution,” Fisher said in an April 4 speech in Hong Kong.
Fisher, 65, opposes Fed action that would increase inflation. Prices rose 1.2 percent in March from a year earlier, well short of the Federal Reserve’s 2 percent inflation target.
Is It Time To Short Homebuilders? This Answer Might Surprise You
According to Jeffrey Gundlach, chief executive and chief investment officer of DoubleLine Capital, it is time.
“Investors should bet against the SPDR S&P Homebuilders ETF because he does not see the expected rebound in single-family housing occurring”
We like the idea as this ETF is likely to yield about a 50% return on the short side over the next few years. Why? For the following reasons.
- As we have outlined so many times before, the housing recovery is over and the entire real estate market is about to embark on the most vicious bear leg of it’s decline. Stage 3. You can read everything you need to know about this here. Real Estate Collapse 2.0 Why, How & When
- Our advanced mathematical and timing work predicts a severe bear market between 2014-2017. Under such circumstances the real estate market will not be able to maintain its upward trajectory. On the contrary, it might be one of the sectors leading the market lower.
- SPDR S&P Homebuilders ETF (XHB) is showing early signs of a technical price breakdown.
When you combine the points the above, SPDR S&P Homebuilders ETF (XHB) becomes a very good short investment opportunity.
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Is It Time To Short Homebuilders? This Answer Might Surprise You Google
Reuters: DoubleLine’s Gundlach recommends shorting homebuilders ETF
NEW YORK, May 5 (Reuters) – Jeffrey Gundlach, chief executive and chief investment officer of DoubleLine Capital, said on Monday that investors should bet against the SPDR S&P Homebuilders ETF because he does not see the expected rebound in single-family housing occurring.
Gundlach, speaking at the Sohn Investment Conference in New York, said that problems dogging the housing market include expected rises in mortgage rates and the amount of student loan debt carried by young adults, which makes saving for a down payment difficult.
He also said that if mortgage financiers Fannie Mae and Freddie Mac were wound down by the government, mortgage rates would rise.
Daily Stock Market Update. May 5th, 2014. InvestWithAlex.com
An up day with the Dow Jones up 17 points (+0.11%) and the Nasdaq up 14 points (+0.34%).
I continue to be amazed how/why the majority of market participants relate fundamental economic growth to the future of stock market performance. Case and point……
Investors would be best served by not selling in May, according to Morganlander. “I would say that would be bad advice,” Morganlander said. “You’re starting to see a string of good economic numbers. In fact, I believe that over the coming couple of months, you’re going to start to see the housing market click in as well. That’s going to bode well for the overall markets. You just need to get through this geopolitical concern.”
Such thinking is absolute garbage that has no place in the real world (assuming that you like making money and not losing it). To prove my point, allow me to take you back to October 11th, 2007. The GDP growth was 4.9%, full employment, the stock market was on fire and while the real estate market was showing signs of a roll over, it wasn’t that bad. In a nutshell, economic future looked as bright as it could be.
Yet, the stock market topped out on October 11, (exactly 5 years and 1 trading day from its 2002 bottom) and then proceeded to decline. Slow at first, picking up speed mid cycle and subsequently destroying everything and everyone. There was no fundamental catalyst. Was it possible to predict? I did, but if you were looking at the market from a fundamental perspective you would have never seen it coming.
This is the perfect example why its the stock market that drives the economy and not the other way around. Which brings us to today. Based on our mathematical and timing work the bear market of 2014-2017 is just around the corner.
When it starts it will very quickly retrace most of the gains accrued over the last few years. If you would be interested in learning exactly when the bear market will start (to the day) and its subsequent internal composition, please CLICK HERE
(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here).
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Why Most Economists Are Confused About The State Of Today’s Real Estate Market
The Daily Ticker had a discussion earlier on whether or not the real estate sector was causing the economic slowdown or it was the economic slowdown was causing the real estate market to sag.
Neil Irwin, senior economic correspondent at The New York Times says the slowdown in housing is slowing the broader economy. “If housing just returned to its longer-term role in the economy in terms of residential investment and construction activity, then we’d have a much stronger growth track,” Irwin tells The Daily Ticker in the video above.”We’d have an extra million and a half jobs.”
Here is what they don’t seem to get. Most sectors within the US Economy, including the overall economy itself, are being artificially levitated by entirely too much credit within our financial system. With over $1 Trillion in credit being infused over the last 5 years alone and with interest rates at ZERO, both the US Economy and the real estate market are back in the bubble territory.
Again, this debate initiated by The New York Times confuses cause and effect. The real estate market and the US economy have nothing to do with each other from a traditional point of view and have everything to do with being the outcome of the same force. In short, they are both the outcome of the same credit cancer. Because they are both being artificially levitated by FED into the same speculative bubble territory, they will simply reverse and collapse at the same time when the bear market of 2014-2017 kicks into the high gear.
When? Well, to get more information about the real estate market you can read my comprehensive report Real Estate Collapse 2.0 Why, How & When and for the overall economy/stock market you can read The Bear Market Of 2014-2017 Is Starting. Why, How & When
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Why Most Economists Are Confused About The State Of Today’s Real Estate Market Google
The Daily Ticker: Here’s what’s stopping the economy from fully recovering: Neil Irwin
The housing market is still recovering from a crisis that crushed sales and prices in 2007 and 2008, but the pace of that recovery is slowing and there are some signs it could be stalling out.
Existing home sales and new home sales were actually lower in March than in February — and lower than a year ago. And although March housing starts were higher than February starts, permits fell 2.4% lower.
Neil Irwin, senior economic correspondent at The New York Times says the slowdown in housing is slowing the broader economy. “If housing just returned to its longer-term role in the economy in terms of residential investment and construction activity, then we’d have a much stronger growth track,” Irwin tells The Daily Ticker in the video above.”We’d have an extra million and a half jobs.”
Investment in residential property accounts for the smallest share of the economy than at any time since World War II, Irwin wrote in a recent column for the times “Upshot”.
Home ownership has fallen to its lowest level in 19 years, according to the Census bureau. Only 64.8% of Americans, or about 74.4 million households, owned homes during the first quarter of this year, down from 65.2% in the fourth quarter of 2013.
A big reason for the decline in home ownership: “Young people are not forming households at the same rate they usually do,” says Irwin.
That’s an example of the economy holding back housing but the reverse is also true, says Irwin.
“You need a strong housing market to have a strong economy [and] you need a strong economy to have a strong housing market,” says Irwin.
And within the housing market, construction of multi-family homes is rising at a much faster rate than construction of single-family homes. Young people “who are striking out on their own are more likely to rent” apartments, explains Irwin.
On the positive side, construction jobs led the increase in all “goods-producing” jobs in the April jobs report released Friday. They rose by 32,000 for the month and are up 189,000 in the past year, with the bulk of the increase occurring in the past six months.