2008-04-30

Loooooong weekend

We have long weekend. Will be back on 7-th of May.
Meanwhile I may post something, but we will see.

Readings...

Housing:

S&P/Case Shiller Index for February: -12.7%
from Interest Rate Roundup by Mike Larson
http://interestrateroundup.blogspot.com/2008/04/s-shiller-index-for-february-127.html

Case-Shiller Shows Steep Declines In Home Prices
from Mish's Global Economic Trend Analysis by Michael Shedlock
http://feeds.feedburner.com/~r/MishsGlobalEconomicTrendAnalysis/~3/280334202/case-shiller-shows-steep-declines-in.html

Son of We're Nowhere Near the Bottom in Housing
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/son-of-were-nowhere-near-bottom-in.html

We're Nowhere Near the Bottom In Banking/Finance
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/were-nowhere-near-bottom-in.html

Gold, Oil

Key Ratios: Gold/Oil & HUI/Gold
from Trendsman by trendsman
http://trendsman.com/?p=632
(too foggy)

Safehaven read list:
(Did not read these, because SafeHaven site is down)

Will the Fed Create More Inflation in Commodities?
from Safehaven by Clif Droke
http://www.safehaven.com/article-10117.htm

One Of These Bounces Will Work
from Safehaven by Guy Lerner
http://www.safehaven.com/article-10115.htm

Worst is Not Over and Neither is Fed Easing
from Safehaven by Ashraf Laidi
http://www.safehaven.com/article-10114.htm

2008-04-29

Dollar devaluation

Today I paid for something:
"Your payment of 10.00 EUR (15.90 USD) has been successfully sent."

These are small things you see and makes you think -
"Wow, how low the dollar went..."
I remember time when 1 USD was 3.00 DEM (~1.50 EUR).

Big Readings...

Because of Easter, here you are big readings, including some items from last week:


What To Do With $1000
http://youtube.com/?v=Z8N-JtgVCRM

Uncle Jay Explains the News
http://youtube.com/?v=1OCDJ-nCO9g

21.APR
Bank of England Performs Bail-Out
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/bank-of-england-performs-bail-out.html

Before We Start Thinking This is Over....
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/before-we-start-thinking-this-is-over.html

Housing Is Nowhere Near the Bottom
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/housing-is-nowhere-near-bottom.html

24.APR
March new home sales a disaster
from Interest Rate Roundup by Mike Larson
http://interestrateroundup.blogspot.com/2008/04/march-new-home-sales-disaster.html

U.S. housing vacancy rate sets a record high
from Interest Rate Roundup by Mike Larson
http://interestrateroundup.blogspot.com/2008/04/us-housing-vacancy-rate-sets-record.html

Geopolitics of Peak Oil
from Mish's Global Economic Trend Analysis by Michael Shedlock
http://feeds.feedburner.com/~r/MishsGlobalEconomicTrendAnalysis/~3/277729732/geopolitics-of-peak-oil.html

Buffett: Recession Longer, Deeper Than Most Think
from Mish's Global Economic Trend Analysis by Michael Shedlock
http://feeds.feedburner.com/~r/MishsGlobalEconomicTrendAnalysis/~3/279763590/buffett-recession-longer-deeper-than.html

Geography of non-US Stock Markets
by Richard Shaw
http://www.safehaven.com/article-10101.htm

Honest Money Gold and Silver Report: Market Wrap
by Douglas V. Gnazzo
http://www.safehaven.com/article-10089.htm

Silver Update
by Roland Watson
http://www.safehaven.com/article-10074.htm

Gold - The Sentiment Shift Continues
by Gary Tanashian
http://www.safehaven.com/article-10072.htm

Not Enough Silver
by David Morgan
http://www.safehaven.com/article-10080.htm

The Bloody Knife Used to Gut Bear Stearns???
by Reggie Middleton
http://www.safehaven.com/article-10112.htm

China, Gold and The Coming Flood of Wealth
by Julian D. W. Phillips
http://www.safehaven.com/article-10106.htm

2008-04-22

1.60 :)

EUR/USD = 1.60 +
well congrats...

Gold is 920+, Silver 17.80+, HUI is relatively higher, but not as it was 2 (trading) days ago.

Update:
ah. I forgoth. Stockmarket down hard.

2008-04-21

Fractional reserve banking calculation

Today I decided to play little bit with MsExcel, and to make this little calculation.
What we have here is as following -

Mr.A1 go to his bank B1 and deposit 100 USD (EUR, BGN etc.). The bank B1 keep 10% as reserve and loan the rest 90 USD to Mr.C1, who buy something from Mr.A2,

Mr.A2 go to his bank B2 (probably different from B1) and deposit 90 USD. The bank B2 keep 10% as reserve and loan the rest 81 USD to Mr.C2, who buy something from Mr.A3,

Mr.A3 go to his bank B3 (probably different from B1 and B2) and deposit 81 USD. The bank B3 keep 10% as reserve and loan the rest 72.90 USD to Mr.C3, who buy something from Mr.A4,

...

This continue as long as the credit go to 1 USD, where we stop calculating.

From the 100 USD of Mr.A, the bank created 989.22 - 100.00 = 889.22 USD brand new money - 43 people have those money in their accounts (and 42 different people owe those 889.22 USD to the bank). This show how banks create money (and inflation too) without any money printing.



#Deposit
USD
10%
Fraction
Reserve
Credit
1100.0010.0090.00
290.009.0081.00
381.008.1072.90
472.907.2965.61
565.616.5659.05
659.055.9053.14
753.145.3147.83
847.834.7843.05
943.054.3038.74
1038.743.8734.87
1134.873.4931.38
1231.383.1428.24
1328.242.8225.42
1425.422.5422.88
1522.882.2920.59
1620.592.0618.53
1718.531.8516.68
1816.681.6715.01
1915.011.5013.51
2013.511.3512.16
2112.161.2210.94
2210.941.099.85
239.850.988.86
248.860.897.98
257.980.807.18
267.180.726.46
276.460.655.81
285.810.585.23
295.230.524.71
304.710.474.24
314.240.423.82
323.820.383.43
333.430.343.09
343.090.312.78
352.780.282.50
362.500.252.25
372.250.232.03
382.030.201.82
391.820.181.64
401.640.161.48
411.480.151.33
421.330.131.20
431.200.121.08
989.2298.92890.30

Offensive comments

I really like that I began to receive such comments. This means the blog gets more popular.

However, once again, do not post any stupid advertizement comments, better contact me for paid advertizement as www.e-nick.org did.

2008-04-16

Yahoo began to dicouple from mainstream

Two videos on Oil prices:

High Oil Prices? You Ain't Seen Nothing Yet
http://finance.yahoo.com/tech-ticker/article/11413/High-Oil-Prices-You-Ain

6 Ways to Profit from 'Peak Oil'
http://finance.yahoo.com/tech-ticker/article/11442/6-Ways-to-Profit-from-'Peak-Oil'?tickers=PBR,CNQ,ECA,SU,NXY,XOM,CVX

Foreclosures Jump 57% !?!?!

Black chronicle :-(

Reuters: Foreclosures jump 57 percent in last 12 months
http://www.reuters.com/article/topNews/idUSN1435957820080415?pageNumber=3&virtualBrandChannel=0

Bloomberg: U.S. Foreclosures Jump 57% as Homeowners Walk Away
http://www.bloomberg.com/apps/news?pid=20601068&sid=abvo2Kmwc6lw&refer=economy

Sunshine State caught on horns of stagflation
http://www.nzherald.co.nz/section/466/story.cfm?c_id=466&objectid=10504306

Gold Bull - Alive And Well

Gold Bull - Alive And Well! By Eric Hommelberg
http://news.goldseek.com/EricHommelberg/1199721880.php

I did not read that in full,
but I can not see Dow @ 5,000. I can see Dow @ 50,000 and Gold @ 16,666 :)
I am serious, and have unpublished research on same matter.

Recent stockexchange orders

                Status  Type    Symbol  Limit           Ex.     Expiration

16.04.2008 Open Buy GRS 7.65 USD AMEX 16.05.2008
14.04.2008 Open Buy PWE 27.8 USD NYSE 22.04.2008

08.04.2008 Open Sell KGC 26 USD NYSE 08.05.2008
04.04.2008 Open Sell GLD 95.5 USD AMEX 02.05.2008
02.04.2008 Open Sell MFN 13 USD AMEX 02.05.2008



This is NOT a trade advice

Stockexchange transactions

sold GRS @ 8.30

KOca Cola + MaCDonalds

Here you are - KO, MCD, Dow Jones, S&P500 and Nasdaq.

Coca Cola and McDonald's actually performing very well.
They are still 20% up for last 12 mo.
Note Dow is flat and S&P and Nasdaq are minus 10%.

This is because:

1. US Inflation. You may not go to cinema, but you still need to eat something, and what better to eat than one big juicy cholesterol BigMac :-) + one big diet coke. Kids love it.

2. KO and MCD are international companies and their profit comes in mixed currencies, not only USD. They receive EUR, JPY, GBP, BGN - a truly diversificated currency portfolio.

I still recommending those stocks :-)

Readings...

Bailing Out Banks
by Ron Paul
http://www.safehaven.com/article-9971.htm

Gold Highs, Dollar Lows Not for Long
by Mike Paulenoff
http://www.safehaven.com/article-9984.htm
(I do not agree to this)

The I.M.F. Gold Sales Will Be Very Good For the Gold Price
by Julian D. W. Phillips
http://www.safehaven.com/article-9970.htm

Revealed! The Govt.'s Secret Plan to Cure the Debt Crisis

http://finance.yahoo.com/tech-ticker/article/11304/Revealed

I am amazed how this make path to the mainstream :)

2008-04-15

Readings...

March local home sales, prices drop
from Interest Rate Roundup by Mike Larson
http://interestrateroundup.blogspot.com/2008/04/march-local-home-sales-prices-drop.html

Global Recession On The Way
from Mish's Global Economic Trend Analysis by Michael Shedlock
http://feeds.feedburner.com/~r/MishsGlobalEconomicTrendAnalysis/~3/270463521/global-recession-on-way.html

We're Nowhere Near the Bottom In Housing
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/were-nowhere-near-bottom-in-housing.html

Everything You Wanted to Know About Credit Default Swaps -- But Were Afraid to Ask
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/everything-you-wanted-to-know-about.html


Bulgarian readings:

Прогнози за икономиката през 2008
from Блогът за икономика by Георги Ангелов
http://ikonomika.org/?p=1305
(In Bulgaraian - BG economy growth expectations for 2008)


TravelJungle/Airline readings:

Frontier Airlines and Homeowners: Bad Contracts Broke Both of Them
from Lawinfo Weblog by Todd Knode
http://feeds.feedburner.com/~r/LawinfoWeblog/~3/270220990/
(Extraordinary article - a must read)

Delta, Northwest Agree to Combine (Yahoo Finance, AP)
http://biz.yahoo.com/ap/080415/delta_northwest.html

Stockexchange transactions conducted yesterday

Sold PWE @ 29.30

Wishlist:

PWE @ 27.80, but before 29th.April, so to collect next dividend

2008-04-14

Gold in different currencies

Global Gold 4 by Adam Hamilton
http://www.safehaven.com/article-9937.htm

Bulgarian post

If you are Bulgarian check this out:
Случят с битата учителка по английки в Пловдив

Readings...

More Reasons For Spiking Food Prices
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/more-reasons-for-spiking-food-prices.html

Expecting More Bad Inflation News
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/expecting-more-bad-inflation-news.html

Fourth Airline Seeks Bankruptcy Protection
from The Bonddad Blog by bonddad
http://bonddad.blogspot.com/2008/04/fourth-airline-seeks-bankruptcy.html

Wachovia takes a big loss, hits the markets up for $7 billion
from Interest Rate Roundup by Mike Larson
http://interestrateroundup.blogspot.com/2008/04/wachovia-takes-big-loss-hits-markets-up.html

Import inflation explodes; Confidence tanks
from Interest Rate Roundup by Mike Larson
http://interestrateroundup.blogspot.com/2008/04/import-inflation-explodes.html

Wachovia Needs Another Transfusion
from Mish's Global Economic Trend Analysis by Michael Shedlock
http://feeds.feedburner.com/~r/MishsGlobalEconomicTrendAnalysis/~3/269817611/wachovia-needs-another-transfusion.html

G7 Spotlight On Currencies
from Mish's Global Economic Trend Analysis by Michael Shedlock
http://feeds.feedburner.com/~r/MishsGlobalEconomicTrendAnalysis/~3/269757052/g7-spotlight-on-currencies.html

Fed Is Incompetent And Dangerous
from Mish's Global Economic Trend Analysis by Michael Shedlock
http://feeds.feedburner.com/~r/MishsGlobalEconomicTrendAnalysis/~3/269302744/fed-is-incompetent-and-dangerous.html

2008-04-09

European GDP

This interesting comparison was bring to our attention from Georgi Angelov from The Blog for Economics (http://ikonomika.org/?p=1298)

A Golden Bottom by Roy Martens

A Golden Bottom by Roy Martens
http://www.safehaven.com/article-9927.htm

Some thoughts - Americans really don't get it...

Today I listened Bloomberg. Actually I wanted to hear uncle Ben the Helicopter commander.
However I heard a discussion, I can not quote, but was something like this (underline words are quoted):

Bloomberg journalist:
- Commodities prices rising. At same time America's economy slowing down. Many economists wondering why this happen. What's your oppinion, can you explain why this happen for our listeners?
The economist:
I am not sure. Nobody knows why this happen, and marker is shocked right now. Usually you can not have (US) economy slowing down and commodities rising, usually if economy slows down, commodities must go down too.

Gold and Gold stocks.

With oil at new record, it is strange how the gold stocks performing. I do not say they are trashed, but they are lower than 3 days ago, when oil and gold were lower.

I see also the EUR/USD is almost 1.58.30, which is bullish too.

May be we need to wait 1-2 days to see "normal" stocks rally, so the gold/silver stocks to raise too.

Finally the juniors - well today the juniors I follow are actually down, but case with junior miners is different as usual...

Oil triangle...

Oil triangle is broken now. May be George Blake will be right and we will see 160 oil sooner than expected.

I am very bullish now, and I just removed speculative PWE sell order.
Unfortunately I have no PBR at the moment, I sold it very early.

The Bonddad Blog: What Inflation?

The Bonddad Blog: What Inflation?

Stockexchange transactions conducted yesterday

Buy GRS @ ~ 7.65 at market open.

Wishlist:
Currently will try to sell it @ 8.30.
However, if they fall will keep them and buy some more.

Readings...

How to Spot a New Uptrend in Gold by David Nichols
http://www.safehaven.com/article-9915.htm
(Generally do not like his articles, but this one is interesting)

How commodity speculation works
http://theroxylandr.wordpress.com/2008/04/08/how-commodity-speculation-works/#comments

2008-04-08

IMF Gold Sale Update

Thanks Laura :-)

IMF seeks to sell 403.3 tonnes of gold in financial overhaul
WASHINGTON (AFP) - The International Monetary Fund Monday proposed the sale
of 403.3 tonnes of gold to bolster its sagging coffers as part of a
wide-ranging financial overhaul. The sale, amounting to some 12 percent of
its gold reserves, could yield around 11 billion dollars, IMF officials
said, supporting a reorganization of the institution as it seeks to survive
a downturn in lending to troubled countries. Managing director Dominique
Strauss-Kahn said in a statement the IMF would use the funds to help shore
up IMF finances and create a new endowment with more diverse investments to
generate income. The announcement comes with the IMF in the midst of an
intense effort to trim costs and slash jobs as its lending is scaled back,
with some countries refusing the IMF's conditional aid. The IMF faces a
budget shortfall of some 140 million dollars for the fiscal year 2008 that
ends on April 30. The sale would affect some 13 million ounces of the IMF's
103.4 million ounces of gold reserves. IMF officials said the sale would
likely take place over several years in an effort to avoid market
disruption. Still, the sale could have a dramatic impact on the market,
where according to IMF officials some 500 tonnes are traded annually. Gold
prices recently hit an all-time record above 1,000 dollars an ounce. An IMF
official speaking on condition of anonymity said an average price of about
850 dollars an ounce would generate about 11 billion dollars. The IMF said
the executive board agreed to revamp the institution's income model from one
that primarily relies on lending to one that "generates funds from various
sources." The expansion of the fund's investment authority is contingent on
a charter amendment that would need legislative action in most member
countries. In addition, approval by the US Congress is required for the US
executive director to vote for the gold sale. The reform plan requires
approval by 85 percent of the voting power of the institution's 185 member
nations, which is dominated by the US.


http://afp.google.com/article/ALeqM5jIowsxGM-hMWqLU-V0kBUXhOqnYQ

Uncle Jay Explains the ... R word

2008-04-07

Stockexchange transactions

Sold:
GRS @ 8.30
PWE in my speculative account is on the way to be sold,
but not yet there (29.30 USD, until 15th April)

Buy orders:
GRS @ 7.70 :-)

2008-04-06

Triangles

Crude and USD - Possible Triangles by Dan Stinson
http://www.safehaven.com/article-9882.htm

Hmmm, I said absolutely same about week ago in a blog comment... :-)

2008-04-04

Weekend song again

If you do not know Russian, but you know Bulgarian here you are the song lyrics:
http://otkrovenia.com/main.php?action=show&id=91920

Weekend song - Back to 1983


Million Roses - My favorite song from Alla Pugachova,
Viva USSR :-)

My new non-financial article

Sendmail to Postfix migration by Nikolay Mihaylov
http://nmmm.nu/postfix.htm

Keywords:
Linux, UNIX, FreeBSD, RedHat, Fedora, E-Mail, Sendmail, Postfix, System Administration

2008-04-02

Sinclair's bet

From http://www.jsmineset.com/ site:



Posted On: Wednesday, April 02, 2008, 9:50:00 AM EST

Gold Bears: Put Your Money Where Your Mouth Is

Author: Jim Sinclair


Dear Comrades in Golden Arms (CIGAs),

In times like these I invite you to put your non-margined hand in my totally confident hand. Be calmed as we walk the wildness of the gold market to $1650.

I know gold is headed for $1650. If that is not enough for you today, then please allow me to demonstrate my commitment to my view of the gold price.

We wish the Fed, the US Treasury and all other central banks well in this process as there is NO other alternative.

KNOW that there are consequences to the increase of non-drainable international liquidity created to craft the appearance that no further major international investment and banking companies will need rescuing.

My position on timing and price is that Gold will trade at USD $1650 before the second week of January 2011.

I am offering a $1,000,000USD wager to a financially qualified party that this will occur within the stated timeframe. Any party on Bloomberg, CNBC or CNN-Business stating an opposite opinion on the price of gold should be informed of this challenge.

Please communicate to ANY vocal bearish so-called gold expert that I challenge them to put their money on their views.

Any commentator unable to financially meet this challenge should not be opining. If they really knew the gold and currency market they could easily meet the challenge.

I am relying on you CIGAs to forward this challenge to any vocal bear, suggesting they stop flapping their lips by putting up or shutting up. It is one thing to hide behind a computer screen. It is another to bet the ranch on the view you promote.

The technical procedure of a serious wager is:

Prove you can in fact wage the challenge by an attorney's letter.
Segregate the funds in cash or near cash kind in the hands of your attorney.
Execute an agreed upon binding contract stating the terms of the wager.
(This offer is void in all areas where wagering is illegal if any such areas still exist in our algorithm-geek casino world)

Respectfully yours,
Jim Sinclair

Uncle Ben's testimony

Hi,

Today is 2-nd of April. Today is 2-nd fools day. Tomorrow will be 3-rd and so on.

I am truly amazed how Americans still did not get it. Today I decided to listen to Bloomberg radio for a while, and they broadcasted the Helicopter Ben testimony. He just lied in front of everyone.

Here are some examples:

Additionally, the decline in the foreign exchange value of the dollar has boosted some non-commodity import prices and thus contributed to inflation. However, the so-called core rate of inflation--that is, inflation excluding food and energy prices--has edged down recently after firming somewhat late last year.
Really? Translation - Buy Gold

It now appears likely that real gross domestic product (GDP) will not grow much, if at all, over the first half of 2008 and could even contract slightly.
Hmmm? Growth?

To prevent a disorderly failure of Bear Stearns and the unpredictable but likely severe consequences of such a failure for market functioning and the broader economy, the Federal Reserve, in close consultation with the Treasury Department, agreed to provide funding to Bear Stearns through JPMorgan Chase. Over the following weekend, JPMorgan Chase agreed to purchase Bear Stearns and assumed Bear’s financial obligations.
I did not know FED bail out companies? BSC is not a normal bank?!?! FED is not made to bail out any kind of wall-street idiots. FED please bail me too..

Source:
http://www.federalreserve.gov/newsevents/testimony/bernanke20080402a.htm

Stockexchange transactions yesterday and today

Transactions conducted:
02-04-2008 Sell PBR @ 106.00
01-04-2008 Buy GLD @ 86.55
01-04-2008 Buy KGC @ 21.00

PBR wishlist:
@ 105, @ 103, @ 100

Readings...

First Today Readings...

Closer Look At The ARMs Reset Problem by Mish
http://globaleconomicanalysis.blogspot.com/2008/04/closer-look-at-arms-reset-problem.html

Dollar, Stocks Rally As Banks Replenish Capital by Mish
http://globaleconomicanalysis.blogspot.com/2008/04/dollar-stocks-rally-as-banks-replenish.html

Tuesday, April 1, 2008 Today's Markets by BondDad
http://bonddad.blogspot.com/2008/04/todays-markets.html

Paulson's 'Civic Robbery' To Finance Hyper Inflation by John Browne from EuroPacific Capital
http://www.safehaven.com/article-9847.htm
(sounds just like Peter Shiff itself :-) )

Second, Doug's quiz answers:

Questions and Answers About Money by Douglas V. Gnazzo
http://www.safehaven.com/article-9850.htm