I probably don't have to tell you this, but the odds are stacked against you when it comes to "beating the market."
By nearly 6 to 1 in fact...
Investment
analysts, advisors and fund managers -- the so-called experts -- spend
their entire working lives and billions of dollars on research vowing to
"beat the market" in any given year -- yet the vast majority of them fail...
Just
look at mutual fund industry's record. In the past three years, just
14% of actively-managed mutual fund managers matched or exceeded the
market's performance according to Standard & Poor's. (more)
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Saturday, October 26, 2013
The Last Time “This” Happened, Stocks Fell 15%
zerohedge.com / by Tyler Durden
As we head into the vinegar strokes of 2013 with the world awash with liquidity and ever ready to BTFATH, we note that the last time the S&P 500 saw two consecutive years when the index did not go negative year-to-date was 1975-1976. As Bloomberg notes, just as in 2012 and 2013, we have not seen one day close below the previous year’s closing level but as Marketfield’s Michael Shaoul comments “eventually circumstances will change sufficiently to make the equity market a treacherous place,” and if history is any guide, just as 1977 saw stocks drop 15%, then 2014 may reacquant investorsd with what “risk” and “volatility” means in US equities.
Of course, a 15% drop in today’s environment would be crushing… with margin at record levels and the world rehypothecated to the nth extreme…
SOURCE
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As we head into the vinegar strokes of 2013 with the world awash with liquidity and ever ready to BTFATH, we note that the last time the S&P 500 saw two consecutive years when the index did not go negative year-to-date was 1975-1976. As Bloomberg notes, just as in 2012 and 2013, we have not seen one day close below the previous year’s closing level but as Marketfield’s Michael Shaoul comments “eventually circumstances will change sufficiently to make the equity market a treacherous place,” and if history is any guide, just as 1977 saw stocks drop 15%, then 2014 may reacquant investorsd with what “risk” and “volatility” means in US equities.
Of course, a 15% drop in today’s environment would be crushing… with margin at record levels and the world rehypothecated to the nth extreme…
SOURCE
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Precious Metals: Gold, Silver and Miners Are Trapped
Gold Spot Price – Weekly Chart
This chart clearly shows the trends which gold has gone through in the last three years. With simple technical analysis trend lines, clearly price is nearing a significant apex which will result in a strong breakout in either direction.Remember, this is the weekly chart, so we could still have another month or three of sideways chatter to work through. But a breakout in either direction will trigger a large move.
Silver Spot Price – Weekly Chart
Silver is also stuck in a similar pattern. Currently the odds still favors lower prices and for the upper resistance trend line to reject price and send it lower. But if we keep out eye on the leading indicators like gold miners, we may be able to catch a breakout or traded the rejection of resistance in the next month or so.Gold Mining Stock ETF – Monthly Chart
Gold miners have a very sloppy looking chart. Price is extremely volatile and the recent price action in 2013 could go either way VERY quickly. I have a gut feeling GDX in the coming months could have a washout bottom and tag the $20 price level. While I hope I am wrong for many investors sake, if it does happen, it will be a very strong investment level to accumulate a position.Precious Metals Bigger Picture Outlook:
In short, I remain neutral – bearish for this sector. In the next 1-3 months we are likely to see some strong price action which will be great. We need a breakout or bottoming pattern to form before we get involved at this level.I know everyone is dying to get involved in precious metals again for another huge rally… but sometimes it’s just best to wait for the big picture chart to catch up with your bias before taking a position of size.
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Dollar’s Breakdown, Stocks’ Breakout and Implications for Gold
After 12 years of gains, gold has fallen nearly 20% this year. The
price of gold has been pressured for much of this year by the view that
the Fed would end its stimulus program soon because of strength in the
U.S. economy. However, some recent (weaker than expected) economic data,
along with the 16-day U.S. government shutdown, have suggested that the
central bank may keep its bond purchase in place for longer and
increased gold’s safe-haven appeal.
What impact did these circumstances have on the yellow metal?
In less than two weeks, gold has rallied 8% (nearly $100 an ounce) and it seems that the shiny metal will end higher for a second straight week.
On Thursday, the price of gold climbed to a one-month high after preliminary data showed that U.S. manufacturing activity fell to a 12-month low of 51.1 in October from a reading of 52.8 in September. Additionally analysts had expected U.S. jobless claims to fall by 22,000 to 340,000 last week. Meanwhile, a separate report from the U.S. Department of Labor showed that the number of individuals filing for initial jobless benefits declined by 12,000 last week to a seasonally adjusted 350,000. The above (weaker than expected) numbers raised expectations for continued easy-money policies from the Federal Reserve.
Taking into account the fact that yesterday gold reached its highest level since Sept. 20., the big question is: will it keep rallying?
Today, we’ll examine the US Dollar Index from many perspectives and take a look at the long-term S&P 500 chart to see if there’s anything on the horizon that could drive gold prices higher or lower in the near future. We’ll start with the long-term USD Index chart (charts courtesy by http://stockcharts.com)
READ MORE
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What impact did these circumstances have on the yellow metal?
In less than two weeks, gold has rallied 8% (nearly $100 an ounce) and it seems that the shiny metal will end higher for a second straight week.
On Thursday, the price of gold climbed to a one-month high after preliminary data showed that U.S. manufacturing activity fell to a 12-month low of 51.1 in October from a reading of 52.8 in September. Additionally analysts had expected U.S. jobless claims to fall by 22,000 to 340,000 last week. Meanwhile, a separate report from the U.S. Department of Labor showed that the number of individuals filing for initial jobless benefits declined by 12,000 last week to a seasonally adjusted 350,000. The above (weaker than expected) numbers raised expectations for continued easy-money policies from the Federal Reserve.
Taking into account the fact that yesterday gold reached its highest level since Sept. 20., the big question is: will it keep rallying?
Today, we’ll examine the US Dollar Index from many perspectives and take a look at the long-term S&P 500 chart to see if there’s anything on the horizon that could drive gold prices higher or lower in the near future. We’ll start with the long-term USD Index chart (charts courtesy by http://stockcharts.com)
READ MORE
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The Boom and Bust Cycle
As is clear to all with half a brain the production of un-backed fiat
money distorts the economic system. Simply told, when an entity in
society is given monopoly to manufacture medium of exchange at its own
discretion they will harness this power. Slowly at first, unsure about
its effects, but always testing the limits of the privilege bestowed
upon them.
As always, they will overexploit the power. They will manufacture money and give it to the masters that coercively secure the continuation of the power. The masters will obviously spend the money, creating a transaction in which nothing is payment for something. These transactions are by definition unsustainable because they violates Say`s law. We call them “bubbles”
In a free market supply is used to create its own demand. When people spend fiat money they exercise demand without providing supply. Said in other words, spending fiat money is tantamount to capital consumption and makes society poorer. (more)
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As always, they will overexploit the power. They will manufacture money and give it to the masters that coercively secure the continuation of the power. The masters will obviously spend the money, creating a transaction in which nothing is payment for something. These transactions are by definition unsustainable because they violates Say`s law. We call them “bubbles”
In a free market supply is used to create its own demand. When people spend fiat money they exercise demand without providing supply. Said in other words, spending fiat money is tantamount to capital consumption and makes society poorer. (more)
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