NMMM Finance Notes: 2009-03

2009-03-30

IMF gold sales expected to be on G20 agenda

Draft G20 communique suggests IMF will be asked to advance gold sales proposals to help aid low-income countries.
http://www.mineweb.co.za/mineweb/view/mineweb/en/page34?oid=81036&sn=Detail
Interesting if China will be the buyer - to swap US government bonds to Gold.

Readings

We can double the output of solar and wind, and double it again. We'll still depend on hydrocarbons.
http://oildepletiondebate.blogspot.com/2009/03/lets-get-real-about-renewable-energy.html

Russia wants rouble, yuan, gold in SDR basket
http://www.reuters.com/article/marketsNews/idAFLS37648120090328?rpc=44

HUI - Relax and learn to love the corrections
http://feedproxy.google.com/~r/BiiwiicomNotes/~3/Gp0Prp5nGTk/hui-relax-and-learn-to-love-corrections.html

US dollar rally... real or Memorex?
http://feedproxy.google.com/~r/BiiwiicomNotes/~3/-GkylSTmHXo/us-dollar-rally-real-or-memorex.html
flag in USD

Tata plans to sell Nano in US by 2011/12
http://www.autobloggreen.com/2009/03/24/tata-to-send-nano-to-america/
...and...
Nice Tata Nano gallery, incl. dashboard
http://www.autobloggreen.com/photos/tata-nano-the-peoples-car/627636/

Surfing the Kondratieff Wave
http://greatdepression2006.blogspot.com/2009/03/surfing-kondratieff-wave.html

Borrowing Against Your 401K…. 401K Debit Cards?
http://feedproxy.google.com/~r/LawinfoWeblog/~3/ly2acv5PN1E/

UK

British Bond Auction Fails
http://bonddad.blogspot.com/2009/03/british-bond-auction-fails.html

Videos:

Jim Rogers on Commodities
http://www.foxbusiness.com/video/index.html?playerId=videolandingpage&streamingFormat=FLASH&referralObject=4008984&referralPlaylistId=undefined

Bill Murphy on Bloomberg
http://www.thefinancialtube.com/video/2628/Suppressing-the-gold-price
GATA

Obama Defends US Dollar ... by printing?!?
http://www.thefinancialtube.com/video/2623/Obama-Defends-US-Dollar
You can see such noncence only on CNBC :-)

Gold Will Hit $1,500
http://www.thefinancialtube.com/video/2619/Gold-Will-Hit-$1500
Tech analysis on CNBC

China Calls for Super Currency
http://www.thefinancialtube.com/video/2626/China-Calls-for-Super-Currency
SDR's, not so interesting

Jim Rogers explains the false US dollar rally
http://arabianmoney.net/2009/03/26/jim-rogers-explains-the-false-us-dollar-rally/

Interesting:

Unveiling the "Sixth Sense", game-changing wearable tech
http://www.ted.com/talks/view/id/481

"Котки" в Музикалния театър
http://blog.peio.org/?p=3560

2009-03-26

Gold chart

Gold chart from Doug Gnazzo, I hope he will not mind that I post it here.

My comment:
We have a triangle, very bullish sign, but price may fall to $87.50 (~$885 in gold terms), before the raise begins.

However, if you going to participate, I think you should establish a possition at current prices - e.g. BUY NOW, and NOT WAIT the fall to $890 area. After that if price fall to $890 area, it could be used to add to the existing possition.

NOKIA - Disconnecting people ?

HELSINKI, March 26 (Reuters) - Nokia (NOK1V.HE), the world's top cellphone maker, has stopped using subcontractors in the assembly of its phones due to faltering demand for mobile handsets, a spokeswoman for the company said on Thursday.

"In engine making we have fully stopped (using subcontractors)," said a company spokeswoman, adding the firm was still using them in other functions like packaging or logistics.

In 2008 Nokia outsourced approximately 17 percent of the manufacturing volume of its mobile phone engines, which include the phone and software that enable its basic operations.

Nokia's key subcontractors have been Foxconn (2038.HK), China's BYD (1211.HK), Jabil Circuit (JBL.N) and Elcoteq (ELQAV.HE).

2009-03-25

Readings

Videos

Why Is There a Coin Shortage?
http://www.moneyshow.com/video/video.asp?wid=3437&t=3&scode=013824

Ron Paul on AIG again
http://www.youtube.com/watch?v=yhO45c1SgGs&eurl=http%3A%2F%2Fwww%2Egoogle%2Ecom%2Freader%2Fview%2F&feature=player_embedded

Safe Haven

Gold (USD) Silver Market Update
by Clive Maund
http://www.safehaven.com/article-12888.htm
...and...
http://www.safehaven.com/article-12887.htm

USD Update
by David Petch
http://www.safehaven.com/article-12898.htm

What a Week!
by Mary Anne and Pamela Aden
http://www.safehaven.com/article-12906.htm

Money and Bread!
by Puru Saxena
http://www.safehaven.com/showarticle.cfm?id=12869
hyperinflation :)

New Gold Upleg
by Adam Hamilton
http://www.safehaven.com/showarticle.cfm?id=12874

2009-03-23

Uncle Jay Explains AIG bonuses

Readings

Gold sector - up to the minute, literally
http://feedproxy.google.com/~r/BiiwiicomNotes/~3/2XYihOhA_xU/gold-sector-up-to-minute-literally.html

SP Futures Hourly Charts at 1:45 EDT: Vertigo
http://jessescrossroadscafe.blogspot.com/2009/03/sp-futures-hourly-charts-at-145-edt.html

US Dollar Weekly Chart with Commitments of Traders
http://jessescrossroadscafe.blogspot.com/2009/03/us-dollar-weekly-chart-with-commitments.html

The AIG Scandal Is Merely a Symptom of Our National Agony
http://jessescrossroadscafe.blogspot.com/2009/03/heart-of-aig-scandal.html
The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already.

Forex Fridays
http://bonddad.blogspot.com/2009/03/forex-fridays_20.html

Probable New Important Trends
http://martinmarketreport.blogspot.com/2009/03/probable-new-important-trends.html
Oil

Videos:

Uncle Jay Explains: Mar. 23, 2009
http://youtube.com/?v=OarT2cQ8oXw
probably the best explanation of the AIG bonuses

Barack Obama on the Tonight Show
http://www.youtube.com/watch?v=ld4wOVZROJw&feature=related

Marc Faber
http://www.youtube.com/watch?v=Aamfc_GGsIA&feature=player_embedded

...and more Marc Faber :-)
http://www.youtube.com/watch?v=KP_fkmNgzdM&feature=player_embedded

2009-03-22

Ron Paul talks AIG Bonuses on CNN American Morning 03/20/2009

Meltdown 101: The Fed's $1T consumer loan plan

Meltdown 101: Will the government's $1 trillion consumer loan program really help consumers?
http://biz.yahoo.com/ap/090320/meltdown_101_talf.html?.v=2

2009-03-20

More for AIG bonuses :)

90% Bonus Tax? Way to Destroy Our Economy
http://finance.yahoo.com/tech-ticker/article/213670/90-Bonus-Tax--Way-to-Destroy-Our-Economy;_ylt=ArRKh7xMtlE.esa9RjXAdEC7YWsA?tickers=AIG,%5EDJI,%5EGSPC,C,BAC,GM?sec=topStories&pos=4&asset=TBD&ccode=TBD

AIG bonuses: Hoover and Roosevelt all over again

Americans vote for 90% tax on AIG bonuses
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article5942865.ece

This is exactly the same mistake Hoover and Roosevelt did in the great depression.

Sure now is bonuses only (for now). But tomorrow will be same for dividends. After tomorrow - everything else.

I am wondering how Governments (not only US), if they must choose between two bad options, always choose third one - much worse option.

Readings

FDIC Closes Sale of Indymac, Loses $10.7 billion
http://feedproxy.google.com/~r/CalculatedRisk/~3/25Rz5RjFViM/fdic-closes-sale-of-indymac-loses-107.html

Bernanke doing his best to crash USD
http://feedproxy.google.com/~r/RealityLenses/~3/oUBBdZx6plU/bernanke-doing-his-best-to-crash-us.html

then see this:

Switzerland starts competitive devaluation
http://realitylenses.blogspot.com/2009/03/switzerland-starts-competitive.html

Yousa! Eleven hundred tonnes in the trust!
http://themessthatgreenspanmade.blogspot.com/2009/03/yousa-eleven-hundred-tonnes-in-trust.html
GLD tonnage

Airtravel and Hotels

Hotel Occupancy Rate Off Sharply
http://feedproxy.google.com/~r/CalculatedRisk/~3/7v267JFUD9k/hotel-occupancy-rate-off-sharply.html
Interesting how it fell after 9/11, because there were no planes in the air for about a week.

Ryanair will charge 1 GBP for toilet inside the aircraft.
http://timesbusiness.typepad.com/money_weblog/2009/03/20-reasons-not-to-fly-ryanair.html
Unfortunately if toilet is 1 GBP, you will decide NOT to buy overpriced water @ 3 GBP.

However may be this will change men mind to pay even 5 GBP for those Ryanair toilets :)

Ryanair girl is secret porn star
http://www.thesun.co.uk/sol/homepage/news/article2323138.ece
Copy/Paste link, because contains explict porn :-)

The Crisis of Credit Visualized :)

2009-03-19

Readings

Where is all the money going?
http://feedproxy.google.com/~r/Bearwatch/~3/5FKC41QsU7Y/where-is-all-money-going.html

Thursday Oil Market Round-Up
http://bonddad.blogspot.com/2009/03/thursday-oil-market-round-up_19.html

UNG-USO Ratio
http://feedproxy.google.com/~r/trendandvalue/~3/nxbp5nADSro/ung-uso-ratio.html
Natural gas / Oil

FOMC statement:

$1 Trillion
http://chrispycrunch.blogspot.com/2009/03/1-trillion.html

Fed starts printing money, gold up sharply
http://arabianmoney.net/2009/03/19/fed-starts-printing-money-gold-up-sharply/

What is the Fed Up 2?
http://greatdepression2006.blogspot.com/2009/03/what-is-fed-up-2.html
see it, includes nice caricature ;)

Off topic in UK:

UK is considering snooping on all social networking traffic
http://webtapping.blogspot.com/2009/03/uk-is-considering-snooping-on-all.html

In Bulgarian:

Държави на ръба на фалита. Къде сме ние?
http://e-vestnik.bg/5832
for AIG

Nothing important happened today*

FOMC statement reaction into the blogosphere

Mike is more like neutral :
Federal Reserve buying up to $300 billion in long-term Treasuries, up to $750 billion extra in agency MBS, plus another $100 billion in GSE debt
http://interestrateroundup.blogspot.com/2009/03/federal-reserve-buying-up-to-300.html

From Bonddad we have:
The Fed's Statement
http://bonddad.blogspot.com/2009/03/feds-statement.html
"there is nothing good mentioned here"

What's another $1.15 trillion?
http://themessthatgreenspanmade.blogspot.com/2009/03/whats-another-115-billion.html
There are a diff between FED statements :)

Gary posted strange article, I can not understand it :)
Gold? Ho hum
http://biiwii.blogspot.com/2009/03/gold-ho-hum.html

Jim Sinclair says:
Mugabe is the Chairman of the Federal Reserve.
http://jsmineset.com/index.php/2009/03/18/in-the-news-today-critical-updates-on-todays-market-action/

Jesse have oppinion like mine:
The Fed's Decision: PRINT
http://jessescrossroadscafe.blogspot.com/2009/03/feds-decision.html

And Mish, as usual sees the event as deflationary, but he shows gold action
Bernanke's Grand Experiment Continues
http://globaleconomicanalysis.blogspot.com/2009/03/bernankes-grand-experiment-continues.html

More updates - tomorrow :)

* "Nothing important happened today" - quote from King George III written on 04.JUL.1776

2009-03-18

Bernanke: Let's inflationary monetization begin!

Fed to buy up to $300B long-term Treasury bonds
http://biz.yahoo.com/ap/090318/fed_interest_rates.html?sec=topStories&pos=1&asset=TBD&ccode=TBD

1. Fed will buy up to $300 billion of long-term government bonds - in normal language this means money printing.

2. ... [FED] will buy more mortgage-backed securities guaranteed by Fannie Mae and Freddie Mac to help that battered market. The central bank will buy an additional $750 billion, bringing its total purchases of these securities to $1.25 trillion. - this does NOT necessary means money printing, but is inflationary.

3. In addition, the Fed said a $1 trillion program to jump-start consumer and small business lending could be expanded to include other financial assets. - this does NOT necessary means money printing, but is inflationary.

They do not kidding and will start printing presses!!!
2 trillions - This is MASSIVE !!!
(...but what are 2 trilloons between friends?)

I am expecting now the buddies from ECB to join the party and to begin monetization too. BOE already joined (see below). From week or two Swiss Central Bank is into the game as well.

Related quotes:

EUR/USD - jumped 4.5 cents up in 1-2 hours.
USD/BGN - down 5 stotinki.
GBP/USD - jumped 2.5 cents.
USD/CHF - down 4 cents.
USD/CAD - down 2 cents.

Gold - jumped from $880 to $950 in 10 min.
Oil - WTI jumped $3 (from $47 to $50)

Dow Jones - jumped 300 points in 1 hour.
MFN (Minefinders Corp) - from 6.50 to 7.50 in 1 hour

Related news:

BOE Votes Unanimously to Print Money
http://trendsman.com/2009/03/18/boe-votes-unanimously-to-print-money/

Stocks jump after Fed says it will buy Treasurys
http://biz.yahoo.com/ap/090318/wall_street.html?sec=topStories&pos=main&asset=TBD&ccode=TBD

Got Gold?

...or...

IBM bidding SUN Microsystems

IBM (IBM) bidding SUN Microsystems (JAVA, formal SUNW) for cash.

SUN is currently up 60%.

Whoever wants more data, let him check in Yahoo Finance:
http://finance.yahoo.com/q?s=JAVA

Readings

A look at the FOREX casino...
http://feedproxy.google.com/~r/BiiwiicomNotes/~3/ZzvC54IjGeo/look-at-forex-casino.html
Interesting EUR chart

A Positive Entry for Once
http://chrispycrunch.blogspot.com/2009/03/positive-entry-for-once.html
U.S. Housing Starts

US Dollar Crash Alert: level 87 is crucial!
http://sufiy.blogspot.com/2009/03/us-dollar-crash-alert-level-87-is.html

Decoupling: China relaxes rules for firms to invest overseas
http://sufiy.blogspot.com/2009/03/decoupling-china-relaxes-rules-for.html

Jim Rogers Says U.S. Bailouts Add to Risk of Depression
http://www.bloomberg.com/avp/avp.htm?N=av&T=Jim%20Rogers%20Says%20U.S.%20Bailouts%20Add%20to%20Risk%20of%20Depression&clipSRC=mms://media2.bloomberg.com/cache/vQzOcJXbzz.A.asf
I believe, I'm reprinting this one.

FUN:

The CEO's Guide to Jetting
http://www.welcomebigwigs.com/
The new Jet Blue advertizement campaign :o)

2009-03-17

Two gold charts

Gold Weekly:

Gold Daily:

AIG bonuses

Rep. Manzullo Questions Bailout Czar Neel Kashkari

Readings

Credit Card Defaults Hit 20 Year High
http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/HD7w_L4QKEg/credit-card-defaults-hit-20-year-high.html

AIG: A Scandal of Epic Proportion
http://jessescrossroadscafe.blogspot.com/2009/03/aig-scandal-of-epic-proportion.html

US Dollar collapse: Foreign debt purchases fall sharply in January
http://sufiy.blogspot.com/2009/03/us-dollar-collapse-foreign-debt.html

TNR Gold TNR.v Los Azules operator Minera Andes MAI.to pays off outstanding Macquarie loan of US$17.5 million
http://sufiy.blogspot.com/2009/03/tnr-gold-tnrv-los-azules-operator.html
TNR.v, MAI.to

"He's not kidding about printing money"
http://themessthatgreenspanmade.blogspot.com/2009/03/hes-not-kidding-about-printing-money.html
Bernanke on 60 minutes.

Subscription Button

2009-03-16

Readings

Gammon Gold Proposes to Acquire Capital Gold; Announces Signing of Letter of Intent
http://www.newswire.ca/en/releases/archive/March2009/12/c8471.html
...and audio interview "The Capital Gold Takeover"
http://commoditywatch.podbean.com/2009/03/15/the-capital-gold-takeover/
...and...
UPDATE - Gammon Gold to buy Capital Gold for about $150.5 mln
http://www.reuters.com/article/marketsNews/idAFBNG43533120090312?rpc=44

The Daily Show with Crammer
http://www.thedailyshow.com/full-episodes/index.jhtml?episodeId=220533

Crude oil & the bull game...
http://feedproxy.google.com/~r/BiiwiicomNotes/~3/RXCq8pjX7HA/crude-oil-bull-game.html

China "worried" about its massive Treasury holdings
http://interestrateroundup.blogspot.com/2009/03/china-worried-about-its-massive.html

Buffett Loses Sterling Credit Rating
http://jessescrossroadscafe.blogspot.com/2009/03/berkshire-hathaways-credit-rating.html

Switzerland starts competitive devaluation
http://feedproxy.google.com/~r/RealityLenses/~3/yG2qnoE_5Lw/switzerland-starts-competitive.html

Lithium: Tata Motors Shows Nano Europa, Indica Vista EV at Geneva.
http://sufiy.blogspot.com/2009/03/lithium-tata-motors-shows-nano-europa.html

Forex Friday's
http://bonddad.blogspot.com/2009/03/forex-fridays_13.html
USD

Gold and Oil Poised to Rise amid General Market Crash
http://www.safehaven.com/article-12788.htm
Gold, Silver, Metals, Oil, USD

2009-03-13

USD tech analysis

Here we have rising channel - blue lines. It is not 100% correct because it "cuts" the previous high, so I may be wrong. Next brown lines show a rising bearish wedge, the wedge is broken already on "correct" side. Now we may expect the USD to fall to support - the blue line.

Since USD will fall, the US markets, the Canadian markets, gold and oil must rally.

2009-03-12

Dow / Gold ratio update

Dow: 7,170
Gold: 926

Dow / Gold ratio = 7.74
(before was 6.90)

Late reading

Think we aren't in a new world?
http://feedproxy.google.com/~r/BiiwiicomNotes/~3/6gcsoOlCet4/think-we-arent-in-new-world.html

Stock Market Rallies to 1997 Prices
http://feedproxy.google.com/~r/CalculatedRisk/~3/hKz87xkeFX4/stock-market-rallies-to-1997-prices.html

Freddie Mac: $23.9 Billion Loss, Asks for $30.8 billion in funding
http://feedproxy.google.com/~r/CalculatedRisk/~3/9T1u4S5mIpM/freddie-mac-239-billion-loss-asks-for.html
This is old already, but I forgot to print it.

Swiss aiming to devalue the Franc
http://trendsman.com/2009/03/12/swiss-aiming-to-devalue-the-franc/

GE Loses Its 'AAA' Credit Rating as S&P Downgrades
http://jessescrossroadscafe.blogspot.com/2009/03/ge-loses-its-aaa-credit-rating-as-s.html

ECB Approaches Zero Rates by Stealth With New Weapon
http://www.bloomberg.com/apps/news?pid=20601087&sid=a2SGLkQo2Hbs

Tax receipts collapse by 17% in the US
http://feedproxy.google.com/~r/RealityLenses/~3/0-i2xATHPDI/tax-receipts-collapse-by-17-in-us.html

Thursday Oil Market Round-Up
http://bonddad.blogspot.com/2009/03/thursday-oil-market-round-up_12.html

Outta the way, Switzerland!
http://themessthatgreenspanmade.blogspot.com/2009/03/outta-way-switzerland.html
GLD tonnage

2009-03-11

Two car articles.

Decoupling in action. Chinese auto sales jump 25 percent
http://sufiy.blogspot.com/2009/03/decoupling-in-action-chinese-auto-sales.html

20 things I know about TATA motors
http://www.panasianbiz.com/2008/12/20-things-i-know-about-tata-motors/

TATA is currently trading around $3.60

The Bond King predicts... inflation.

Pimco Predicts Inflation, Joining Buffett, Marc Faber
http://www.bloomberg.com/apps/news?pid=20601087&sid=aFftQ9jDTjsA&refer=home

via sufiy.blogspot.com

Readings

HUI current status
http://feedproxy.google.com/~r/BiiwiicomNotes/~3/FXtxrYfAqu4/hui-current-status.html

Another twist to Lithium story - Electric Bikes!
http://sufiy.blogspot.com/2009/03/another-twist-to-lithium-story-electric.html

Hourly Action In Gold From Trader Dan
http://jsmineset.com/index.php/2009/03/10/hourly-action-in-gold-from-trader-dan-82/

Fun:

The sub-prime crysis explained
http://www.businesspundit.com/sub-prime/
funny comics, reprinted

In Bulgarian:

Къде е газовата криза?
http://ikonomika.org/?p=2155

Добре, няма да си идвам повече в България
http://e-vestnik.bg/5722

2009-03-10

Comedy Central and CNBC, part 3 - Crammer answers :-)

Watch Comedy Central and CNBC, part 2 first :-)

Visit msnbc.com for Breaking News, World News, and News about the Economy

Comedy Central and CNBC, part 2

The Daily Show With Jon StewartM - Th 11p / 10c

In Cramer We Trust

Daily Show Full Episodes
Important Things With Demetri Martin

Political Humor
Economic Crisis

Posibility for speculative arbitrage with Penn West

Yahoo and other services inform us, that Penn West (PWE:NYSE, PWT.UN:TO) will buy Reece Energy Exploration Corp (RXR:V)
http://biz.yahoo.com/prnews/090310/to443.html?.v=3

According to the agreement, RXR:V owners will receive 0.125 PWT.UN:TO. With other words, for every 8 shares of RXR:V , 1 unit (share) of PWT.UN:TO will be received.

Currently RXR:V is priced 1.16 CAD. PWT.UN:TO is 9.92 CAD.

Simple calculation 1.16 * 8 = 9.28 , against 9.92 or 7% cheaper. [1]

There is of cource a catch. PWT.UN:TO gives monthly dividend, currently 0.23 CAD. The tax on the dividend, at least what I pay is 11%. this means from these 23 cents, i will receive only 21.
These 0.21 CAD real dividend against PWT.UN:TO 9.92 CAD is 2.11 %.

The buyout will be done "early May 2009". This means, if you choose to do so, you will "miss" the dividend for March, April and probably for May.

About May dividend, it will be (probably) received for shares on record on ~26.May, so probably the dividend for May will not be lost.

So back to dividend percentage 3 mo * 2.11% = 6.33%. This is quite close to the 7% in [1].

However I watched closely the ratio between those two stocks today and in one moment, the difference was more than 10%. I believe it will pay off to warch very close this development, and if difference go to 20% or more to add RXR:V, and probably sell PWT.UN:TO or PWE:NYSE as a hedge.

What the risk are?
1. What if the deal is broken? Then RXR:V will fall to the levels of 0.90 CAD. I do not believe this will happen.
2. The risk is the PWT.UN:TO or PWE:NYSE to fall in price. This will lead immediately to fall in price of RXR:V.
3. USD/CAD currency risk - there is NO currency risk, because once you buy the stock/unit, you no longer have money, and the stock/unit float in both USD and CAD.

NOTES:
1. RXR:V and PWT.UN:TO are traded on Canadian stock exchanges, and must not be confused with shares with similar tickers.
2. On some websites like Yahoo Finance, PWT.UN:TO is "transcribed" like PWT-UN or PWT-U
3. Nothing here in this post can not be viewed like trading advice or solicitation of buying or selling stocks.