For spin-free analysis of the global economy, the Australia-based The Privateer is one of our favorite reads. Amidst a cacophony of hubris and unwarranted optimism, its editor, William Buckler, provides a fact-filled perspective that reduces the mainstream media’s reports of “recovery” to drivel. Buckler notes drily that “the signs that the party is indeed almost over are all around us and becoming very difficult to ignore.” The same goes for the U.S. dollar. When Nixon cut off foreign holders from redeeming dollars for gold in 1971, says Buckler, the U.S. initiated a reckless » Read the full article
From the monthly archives:
June 2010
From Spengler, a trenchant assessment of a President who, in the space of just 18 months, bids fair to marginalize America’s influence in the geopolitical world. The essay is written from Israel’s point of view, but its scope encompasses the menacing implications of an alignment between Turkey, Iran, Syria and Russia, with Turkey’s Erdogan the catalyst.
“Whatever the failings of the Bush Administration—and there were many—the world accorded U.S. priorities a grudging respect born of fear. In just two years Obama has become a figure of astonishment and contempt. In every field of foreign policy—Middle East peace, nuclear proliferation, dealings with the Russians, the Korean peninsula, relations with Japan, management of Latin America— the once-stable pillars of U.S. foreign policy are melting down.”
Click here for the complete essay.
Bears can take their pick from among a dozen fetching patterns that all point lower, some of them much lower. One I rather like implies the futures could fall to as low as 992.25, and quickly, if DaBoyz pull the plug. The sibling midpoint support of that target is 1060.75, and we should therefore look for a bounce from that number to confirm our worst suspicions. The pattern is shown in the accompanying chart. Since we should never rule out the possibility of a well-orchestrated short squeeze, let’s use a print at 1084.25 today to warn of trouble.
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Silver got out of a jam Thursday, in the processs exceeding our bull-trigger threshold by an impressive 4 cents. At day’s end the July contract looked bound for a Hidden Pivot resistance at 19.250, provide it can bust past midpoint resistance at 18.930. As of around 10:30 p.m. EDT, buyers were looking pretty feisty.
A little greed is good here, since we don’t want to sell our puts prematurely, just as the party as getting under way. We hold two August 98 puts for 1.06 and four July 96 puts for 0.70. The paper gain on the position at yesterday’s closing prices amounts to a little more than $400. Continue to offer four July 90 puts short for 1.40, good-till-canceled. If you want to see how far DIA would have to fall to get us filled on the order, check out the accompanying chart.
Although August Gold’s sharp intraday recovery yesterday exceeded an imposing resistance peak at 1247.40, the rally failed by three ticks to get past a Hidden Pivot at 1249.70 that I’d implied was even more important. Not to worry, though. The pullback from the day’s high at 1249.50 has been shallow so far, hinting that bulls are ready to take on whatever supply the bad guys throw at it on Friday. A thrust past 1250.50 will indicate liftoff toward two bullish targets: a minor one at 1260.90, and a more important one at 1272.60 flagged here earlier.
[Gary Tanashian writes a technical and macro-fundamental analysis blog, is the publisher of financial website Biiwii.com and the premium-content, market-analysis newsletter Notes From the Rabbit Hole. In the essay below he explains how the interplay between inflation and deflation is used as a monetary policy tool by the Fed and U.S. Treasury. For the record, Rick’s Picks has long predicted a deflationary depression, but with a precipitous and devastating hyperinflationary phase. RA]
I would like to thank Rick Ackerman for the opportunity to continue a conversation that began in 2005 with an email I sent to him in response to an article he wrote about deflation that I felt was beyond the usual boilerplate that keeps insisting that a deflationary depression will bring all asset prices down. In fact, Rick’s constructive view of gold hints that he is not a knee-jerk gold booster like so many gold bugs, but rather a realistic believer in the idea that not all assets are created equal, » Read the full article
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ESU10 – September E-Mini S&P (Last:1077.00)
by Rick Ackerman on June 28, 2010 7:06 am GMT
It’s difficult to recall a Sunday night when the futures were not being squeezed higher. This con-job is pretty lame, though, at least so far, and it will need to get past a midpoint resistance at 1078.50 in any event to open a path to 1086.25, its sibling midpoint. Camouflage for the bull trade will be tough to find, since Friday’s end-of-day rally has been in a shallow consolidation since, but you can short 1086.25 with a stop-loss as tight as 1.00 point. _______ UPDATE (10:04 a.m. EDT): The futures faked their way to 1079.75 overnight, exceeding the midpoint resistance noted above by 1.25 points. We’ll categorize it as a midpoint failure nonetheless — close enough for government work. The pullback has been feeble so far, however, suggesting that sellers and short-coverers will spend most or all of the day thumb-wrestling.