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Saturday, June 29, 2013
The Coming ECONOMIC COLLAPSE & Global FINANCIAL CRISIS
$59 trillion dollars in debt, how much interest on money borrowed from the private global FED RESERVE banks. How much hard assets or cash does that amount of money wield. How much bribery, influence or flat out ownership of the media, colleges, and both political parties, does that kind of power buy? The more debt we are in, the more money the FED makes on interest, from the money we borrow from them; via the IRS, and income taxes. Which they produce from thin air. What a racket!.
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Student-Loan Rates Set to Double
With just two working days left before the U.S.
government doubles a student-loan interest rate, lawmakers are haggling
over what to do about it.
The argument isn't over whether to allow the rate on the most popular type of federal loan to rise above 3.4 percent, the level set by law until July 1. It's about how much borrowing costs will increase.
"The likelihood of students keeping the interest rate they had for the last two years is diminishing by the hour," said Terry Hartle, senior vice president at the American Council of Education, the largest lobbying group for colleges and universities. "The outcome will be students will pay more than 3.4 percent in the short term," he said in a telephone interview. (more)
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The argument isn't over whether to allow the rate on the most popular type of federal loan to rise above 3.4 percent, the level set by law until July 1. It's about how much borrowing costs will increase.
"The likelihood of students keeping the interest rate they had for the last two years is diminishing by the hour," said Terry Hartle, senior vice president at the American Council of Education, the largest lobbying group for colleges and universities. "The outcome will be students will pay more than 3.4 percent in the short term," he said in a telephone interview. (more)
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Miners Can’t Operate With Gold Below $1500, Gold Fields Says
Bullion must rise to $1,500 an ounce for the gold mining industry to
be sustainable, according to Gold Fields Ltd. (GFI)’s Chief Executive
Officer Nick Holland.
“The industry is not sustainable at $1,230 an ounce, which is where the gold price is at the moment,” Holland said today in a telephone interview. “We’re going to need at least $1,500 an ounce to sustain this industry in any reasonable form.”
Gold entered a bear market in April on signs the U.S. economy was improving and fell further this month as Federal Reserve Chairman Ben S. Bernanke signaled he may slow bond purchases should the U.S. recovery continue. The plunging price of bullion is squeezing producers who spent $195 billion on acquisitions in a decade-long price boom that peaked in 2011, when prices reached $1,900 an ounce.
Continue Reading at Bloomberg.com…
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“The industry is not sustainable at $1,230 an ounce, which is where the gold price is at the moment,” Holland said today in a telephone interview. “We’re going to need at least $1,500 an ounce to sustain this industry in any reasonable form.”
Gold entered a bear market in April on signs the U.S. economy was improving and fell further this month as Federal Reserve Chairman Ben S. Bernanke signaled he may slow bond purchases should the U.S. recovery continue. The plunging price of bullion is squeezing producers who spent $195 billion on acquisitions in a decade-long price boom that peaked in 2011, when prices reached $1,900 an ounce.
Continue Reading at Bloomberg.com…
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Scary times hit mortgage shoppers
With mortgage rates rising at a record rate, it's become a scary time for mortgage shoppers.
Homebuyers got blindsided by an interest rate hike of more than half a percentage point Thursday, the biggest increase in more than 26 years. Now, many shoppers don't know whether they should scramble for a loan or wait on the sidelines.
Mike Brewer and his wife, Laura, shopped for a home for months before they finally gave up and decided to build a new place in Warrenton, Va. Since the new home won't be ready until November, however, they can't lock in a mortgage until September, said Brewer.
With rates rising by a percentage point over the past two months, they're already looking at an extra $200 a month -- and climbing -- on a 30-year mortgage.
"We had been hopeful that rates would stay low through 2013, which is why we made the jump when we did," said Brewer, who works as an IT director for a construction company. "Had we known the rates would spike, we might have changed our minds." (more)
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Homebuyers got blindsided by an interest rate hike of more than half a percentage point Thursday, the biggest increase in more than 26 years. Now, many shoppers don't know whether they should scramble for a loan or wait on the sidelines.
Mike Brewer and his wife, Laura, shopped for a home for months before they finally gave up and decided to build a new place in Warrenton, Va. Since the new home won't be ready until November, however, they can't lock in a mortgage until September, said Brewer.
With rates rising by a percentage point over the past two months, they're already looking at an extra $200 a month -- and climbing -- on a 30-year mortgage.
"We had been hopeful that rates would stay low through 2013, which is why we made the jump when we did," said Brewer, who works as an IT director for a construction company. "Had we known the rates would spike, we might have changed our minds." (more)
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Friday, June 28, 2013
Precious Metals Life Cycle Nears an End - Final Stage of Denial
The life cycle of most things not matter what it is (living, product,
service, ideas etc...) go through four stages and the stock market is no
different. Those who recently gave in and bought gold, silver, mining
stocks, coins will be enter this stage of the market in complete denial.
They still think this is a pullback and a recover should be just around
the corner.
Well the good news is a recovery bounce should be nearing, but if technical analysis, market sentiment and the stages theory are correct then a bounce is all it will be followed by years of lower prices and dormancy.
I really do hate to be a mega bear or mega bull on anything long term but the charts have painted a clear picture this year for precious metals and I want to share what I see. Take a look at the chart below which shows a typical investment life cycle using the four stage theory.
The Four Stages Theory
Classic economic theory dissects the economic cycle into four distinct stages: Accumulation, Markup, Distribution, and Decline. Stock, index or commodities are no different, and proceeds through the following cycle:
Gold Price Weekly Chart - Stages Overlaid
Silver Price Weekly Chart - Stages Overlaid
Gold Mining Stocks - Monthly Chart
This chart is a longer term picture using the monthly chart. I wanted to show you the 2008 panic selling washout bottom in miners which I think is about to happen again. While physical gold and silver are in a bear market and should be some a long time, gold mining stocks will likely find support and possibly have a strong rally in the coming months.
Many gold stocks pay high dividends and are wanted by large institutions and funds. The lower prices go the higher the yield is making them more attractive. So I figure gold miners will bottom before physical metals do. A bounce is nearing but at this point selling pressure and momentum continue to plague the entire PM sector.
Precious Metals Investing Conclusion:
In short, I feel with Quantitative Easing (QE) likely to be trimmed back later this year, and with economic numbers slowly improving along with solid corporate earnings the need or panic to buy gold or silver is diminishing around the globe.
While there are still major issues and concerns internationally they do not seem to have any affect on precious metals this year. Long terms trends like the weekly and monthly charts shown in this report tends to lead news/growth/lack of growth by several months. So lower precious metals prices may be telling us something very positive.
The precious metals sector is likely to put in a strong bounce this summer but after sellers will likely regain control to pull prices much lower yet.
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Well the good news is a recovery bounce should be nearing, but if technical analysis, market sentiment and the stages theory are correct then a bounce is all it will be followed by years of lower prices and dormancy.
I really do hate to be a mega bear or mega bull on anything long term but the charts have painted a clear picture this year for precious metals and I want to share what I see. Take a look at the chart below which shows a typical investment life cycle using the four stage theory.
The Four Stages Theory
Classic economic theory dissects the economic cycle into four distinct stages: Accumulation, Markup, Distribution, and Decline. Stock, index or commodities are no different, and proceeds through the following cycle:
- Stage 1 - Accumulation: After a period of decline a stock consolidates at a contracted price range as buyers step into the market and fight for control over the exhausted sellers. Price action is neutral as sellers exit their positions and buyers begin to accumulate.
- Stage 2 - Markup: Upon gaining control of price movement buyers overwhelm sellers and a stock enters a period of higher highs and higher lows. A bull market begins and the path of least resistance is higher. Traders should aggressively trade the long side, taking advantage of any pullback or dips in stock price.
- Stage 3 - Distribution: After a prolonged increase in share price the buyers now become exhausted and the sellers again move in. This period of consolidation and distribution produces neutral price action and precedes a decline in stock price.
- Stage 4 - Decline: When the lows of Stage 3 are breached a stock enters a decline as sellers overwhelm buyers. A pattern of lower highs and lower lows emerges as a stock enters a bear market. A well-positioned trader would be aggressively trading the short side, taking advantage of the often quick decline in share price.
Gold Price Weekly Chart - Stages Overlaid
Silver Price Weekly Chart - Stages Overlaid
Gold Mining Stocks - Monthly Chart
This chart is a longer term picture using the monthly chart. I wanted to show you the 2008 panic selling washout bottom in miners which I think is about to happen again. While physical gold and silver are in a bear market and should be some a long time, gold mining stocks will likely find support and possibly have a strong rally in the coming months.
Many gold stocks pay high dividends and are wanted by large institutions and funds. The lower prices go the higher the yield is making them more attractive. So I figure gold miners will bottom before physical metals do. A bounce is nearing but at this point selling pressure and momentum continue to plague the entire PM sector.
Precious Metals Investing Conclusion:
In short, I feel with Quantitative Easing (QE) likely to be trimmed back later this year, and with economic numbers slowly improving along with solid corporate earnings the need or panic to buy gold or silver is diminishing around the globe.
While there are still major issues and concerns internationally they do not seem to have any affect on precious metals this year. Long terms trends like the weekly and monthly charts shown in this report tends to lead news/growth/lack of growth by several months. So lower precious metals prices may be telling us something very positive.
The precious metals sector is likely to put in a strong bounce this summer but after sellers will likely regain control to pull prices much lower yet.
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