Saturday, May 24, 2014

Clif High Web Bot: June US Economy Crash Begins

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Porter Stansberry: How I'm preparing for the next bear market in stocks

I’m afraid you’re not going to like today’s Friday Digest. It deals with the serious risks to equity prices in the U.S. and how you should handle your portfolio. I’d like to give you a simple barometer to watch – something that will serve as an “early warning” indicator for us. I’m nearly certain you’re not watching this indicator yet. You may have never even heard of it before. It’s something CNBC won’t tell you about. It’s something that will help us get out of stocks before the ongoing correction because of the bona fide bear market.

Here’s the ironic part… just telling you about this indicator is probably going to cost me a lot of money, perhaps even millions of dollars.

You see, we have a lot of subscribers that never want to read anything about risk or the likelihood that stocks will fall in price. And every time I write an essay like this… something that’s generally bearish… and perhaps a bit more sophisticated than what they’re used to seeing in a newspaper… they immediately cancel their subscriptions.

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Financial Sense Newshour – Quarterly Webinar 2014 Q1

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Euro Weakness Remains / Dan Norcini /
I have been keeping a close eye on the Euro ever since ECB President Draghi began talking it down a couple of weeks ago. The reason for this, besides monitoring various currencies for trading opportunities, is to see whether or not it has indeed peaked out and is starting a trending move lower. If it does, it is my view that this is going to especially benefit the US Dollar, as the Euro comprises over 50% of the weightings in the USDX. Consequently, a falling Euro will tend to push the Dollar higher which in turn will tend to push gold lower.

I wish to repeat for the newer readers here, I view gold as the Anti-Dollar. As a general rule, it tends to fall when the Dollar moves higher and conversely, tends to rise when the Dollar falls. The linkage is by no means an exact one – but it is a fairly good judge of whether one can expect rising or falling gold prices as one monitors currency movements.

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The Contrarian Case for Coal Stocks

The sudden abundance of natural gas and tightening of coal-emission standards by the EPA has pushed U.S. coal prices down sharply over the past five years as generation plants shifted their energy preference to the cleaner and cheaper resource:

While no one is suggesting we’re at the dawn of a new coal age, a research note from Westwood investment management makes an interesting case for why we may be at an important inflection point. With natural gas losing some of its pricing edge relative to coal and coal inventories already at lows, we could be at the turn for an incremental shift in demand for coal. “…(W)e believe that 2014 could mark a new profitable stage for the coal sector as headwinds have turned into potential tailwinds,” wrote Westwood’s energy research team.  (more)