Gold und Silber... Informationen und Vermutungen I

FIRST STAGE OF USDOLLAR BREAKDOWN

....Talk of benefits is pure political pablum and Wall Street deceptive spin. Any market correction to the obscenity whereby the United States demands 80% of world capital will NOT come with any benefits, only pain, crisis, financial loss, and disruption. Probably war too.

When the buck broke down in thin holiday trading during the week of Thanksgiving, the real story was with the major international currencys. The euro, swissy, aussie, and sterling all jumped markedly, enough to grab headline news. The USDollar breakdown, plunge, steep decline, severe adjustment shook the global financial world and captured its attention in loud manner. The intractable imbalances are not resolvable, and will present a clear & present danger for years to come. What happened in late November was the first of a great many earthquakes in a long sequence whose trade and debt imbalances serve as tectonic plate gaps rubbed raw by destructive foreign policy discourse amidst power games. The earthquake event six weeks ago made all the more urgent the economic summit meeting in China. The summit might buy more time, but will not in any way fix anything. The main outcome will be for more Wall Street profiteering. More IPO's are in the pipeline, ensuring heavy profit for Chinese leaders on the inside track, and for Wall Street firms who are also on the inside track. The line between government and big private firms has been blurred, if not eradicated, all in the Mussolini tradition without a peep objection by the clueless public.

Inside word has it that the Beijing Summit was a colossal failure. Chinese leaders will permit the yuan currency to rise at a slow pace to their liking. They will open their bank system at their own pace and pleasure. They will collude with Wall Street firms to conceal the damaged financial books on banks to undergo initial public offering. They will dribble income for US intellectual property in a slow laughable trickle, as dictated for software, movies, books, music, and patents. They will diversify to EuroBonds and gold as they damned well please.

They will continue with extraordinary energy projects with Iran, much to the displeasure of the USGovt, whose embassy delivered a warning to Beijing just last week. Games will continue until it is clear who is in charge, the credit master!

Such signal might put an exclamation point on the nice warm fuzzies from the summit itself. In my view Beijing wants four things. First, they want their own regional Asian currency which would stand as the foundation for an Asian credit market. Second, they want a seat at the G8 Finance minister meetings, deserved from good trade behavior or not (see the World Trade Org complaints). Third, they want to expand their military, to be bought with USTBonds sitting around and perhaps assisted by giant Korean shipbuilders (provided technology is donated). Fourth, they want unfettered unobstructed access to the US markets for selling products. Be sure that the USGovt will comply on all counts, all in time.

In the next few months, the USEconomic recession will be more detectible.
The US housing decline will stubbornly continue. The negative effect on the USDollar will be relentless, round after round. What has happened in the last week or more is mere technical posturing within the FOREX market. However, as outlined in the upcoming January Hat Trick Letter report, the requisite USDollar adjustment process contains numerous powerful countervailing forces. Import dependence renders the USEconomy as vulnerable to necessary US$ corrections. The entire cost structure will rise again and again, to obscene levels actually from US$ declines as all costs rise. Expect to see $3 per gallon gasoline again in 2007, most likely during the second half. Foreigners will come to realize they face massive losses in the tens of billion$ within their FOREX reserves. They must diversify. When they do, more shock waves will come.

Gold and silver will respond very favorably. Foreign exporters, primarily Europeans, will suffer from erosion to their export trade. An exported higher currency is lethal and usually resisted. Asians are more willing to provide a nearly total sterilization to the influx of US$ in balance of payments. The buck has nine lives, and perhaps only five or six have been used, fewer than most realize.

The wild card is the utter contempt and disgust for the USGovt Administration from global corners. When incompetence, arrogance, recklessness, and aggression are meted out with poor communication skills, the world's key players react eventually in ways at their disposal.

My view, expressed on numerous occasions, has been that the trade protection issue will undermine relations between the United States and China. Trade protection will be seen as the least undesirable of solutions, and at the same time the most politically expedient for the nouveau ambitious candidates. As US workers lose jobs in droves, US corporations will continue to chug along and earn profits. Next year should deliver more job loss pink slips, as the USDollar declines and business costs rise. Job outsourcing is a direct consequence of rising cost pressures domestically. Voter angst leads them to urge their Congressional reps to impose tariffs, declare quotas, and protect jobs. The effects are to be two-fold. First, anger and resentment will grow in Beijing, probably enough for them to sell large tracts of US$-based securities. That will push the USDollar down hard, even against other Asian currencys, and serve to lift long-term interest rates. Second, prices will rise inside the USEconomy, from reduced supply and from higher import prices. So voter pressure and demands are certain to create a markedly worse situation. It is coming as sure as night follows day, since Congressional leaders appeal to voters and their emotions, with little respect for the right course of action. Some emotions are destructive. In a Wall Street Journal poll conducted in early Dec2006, a majority 61% of Americans believe the USGovt is "not tough enough" when dealing with China......more

CONCLUSION

The biggest risk detectible on my radar is for the US Federal Reserve to remain stubborn.

As long as they extol the mythical strength of the USEconomy, as long as they cry wolf at the ravage of price inflation threats, the risks rise for investors of gold, silver, and crude oil. The longer the buffoons at the USFed hold back on interest rate cuts, the more damage will be born by the housing market, and by the upside down consumption-based economy, and by investors of commodities (whether physical or stocks). In a reckless policy execution, the USFed is playing a grand game of chicken. They want demand destruction, but risk economic downward momentum led by housing. They truly believe they are controlling price inflation, but they are actually risking a situation which might not respond and take to the next low rate medicine. Their next move is to cut rates. ....

The gold price and silver price and oil price all will rise with a falling USDollar. And let's not forget the mind numbing destructive failed policy in the entire Middle East, from each and every corner. Iraq is the quicksand.

Iran is the powderkeg. Israel is the friction. Europe stands in the crossfire. Russia lies in wait, in far more control than the sleepy lapdog US press & media choose to report. For that would be to proclaim a return to the Cold War.
That icy belligerence of conflict is surely here, but on the energy front, which has earned the title the Global Energy War by me since 2003, ignited by the Shock & Awe of the Iraqi War. The only thing shocking is the degree of failure. The only thing of awe is the stubbornness to continue the course. The words mindnumbing fit more and more with each passing day. Ironically, the decisions not to bomb Iran have kept the USDollar up, and the crude oil price down. The decisions not to resume bombardment of Beirut have kept the USDollar up, and the crude oil price down. In the meantime, the USDollar remains fatally wounded, yet Uncle Sam, who leaks bills from his wallet, continues to walk upright.

He is a hollow replica of his former robust self. Numerous friends and foes alike prop him up. One must actually check his pulse to see if he is alive. It might just be a skull & crossbones under the royal robes worn thin by the years. The price of gold, silver, and oil will benefit from the inevitable repeated USDollar declines, which will occur less often than expected for practical reasons.

http://www.321gold.com/editorials/willie/willie010507.html

S04...klar die wissen wo die Schmerzgrenze ist, da gingen einige stop loss ab, viele von Leuten die im Urlaub sind.

Erstmal chartmaessig haben sie es auch ruiniert in der grossen Offensive und Zusammenarbeit der ZB's und GS/JPM Deriviaten.

Die wollen umleiten und ablenken das ist alles.

Egal, irgendwann hoert das auf und dann gibt es einen riesen Schwinger nach oben IMO.

Ich erwarte den noch in dem Monat will aber nichts verschreien.

Im Schnitt kann das 9 Tage dauern, am 3.Januar fing es an und am 12. oder 14. Januar sollte eine Rally beginnen.

Well, the show is not over until the fat lady sings.

Ps.. Ich bin kein Profi oder Guru aber 11 Jahre in dem Pokerspiel PPT vs Gold.

Kannst mir leid tun, hast nicht mal einen Zettel ?

Ciao

XEX

Ihr koennt ja bis dort hin Euer Silber und Gold polieren damit es schoen glaenzt.
Meine beiden Kinder sind bei mir fuer eine Woche somit habe ich auch was zu tun.
Das beste ist man schaltet ein wenig ab, es kommt so wie es kommen wird mit oder ohne hinschauen.
Hauptsache man bleibt im Sattel.

Gruss

Eldo

Ich war mal wieder zu frueh beim OS kaufen, das der PPT unter die 615 / 12.35 haut habe ich nicht erwartet... macht nix !
In ein paar Wochen ist das vergessen.

Gnight & good luck

Eldo