Bear's Lair
Bear Markets always follow Bull markets and a severe stock market correction is long overdue. Bears Lair will spot, monitor and analyze the stock market correction as it develops.
The current economic debate really boils down to one essential question: "Will there be a recession?" To me, the question has about as much vitality as debating whether Roger Clemens will be inducted into the Baseball Hall of Fame.
The US financial system is experiencing a combination of a heart attack (fibrillation from absent trade recycled surpluses), a massive hairball (subprime debt securities) working through the bank arteries, and a realization (like W
As everyone knew gold (spot) was going nowhere in the past week. During those days, the market has been developing a flag pattern in 4-hour charts. Technically, a flag is a consolidation pattern.
Gold held up remarkably well last week given the carnage all around, with silver and Precious Metals stocks cratering, and despite the sharp drop on Thursday it did not break below critical support, unlike silver.
The Gold Price is telling an important story at present. It's telling us that the days of Financial Engineering are over.
The current weakness in domestic markets has recently been magnified overseas as panic spread to foreign investors with exposure to U.S. asset backed debt.
Precious metals have been one of the top performing asset classes over the past six years, and investors wanting to add a precious metals component to their portfolios are often overwhelmed by the number of investment vehicles avai
This Market, including stocks, bonds, real estate and commodities have all been built on a massive amount of credit and "out of thin air" monetary creation.
Summary
As the man said: "Rumours of my death are premature". Huckleberry Fed (huckster that he is) seems to have done it again.
For years, Americans have been able to pay for enormous trade deficits by exchanging IOU's for imported consumer goods.
Fannie Mae is being groomed to be the central clearing house for mortgages and their bonds, sponsored by the USGovt and the US Federal Reserve.
The outlook for gold turned decidedly more bullish last week when it broke above the confines of its “Distribution Dome” for the second time in the space of as many weeks.
Berenanke's hands are tied, he cannot lower rates for fear of a US $ collapse. On the other hand, the money out of thin air creation machine cannot work while lending standards are being tightened.
There is an old market adage which says every Bull market contains the seeds of the next Bear market.
Amid the recent stock market weakness, the pundits are virtually unanimous in their claims that good underlying economic fundamentals are being trumped by irrational fear.
Editor's Note: The following is in answer to a reader's question "What do they mean when they talk about global liquidity drying up?"
A quick review of signals surely can be both encouraging and confusing. They point to higher physical prices, calmer stock prices, and a continued housing crisis & mortgage debacle.
This month, I was honored to be interviewed by Maurice Rosen who publishes the Rosen Numismatic Advisory.
This month, I was honored to be interviewed by Maurice Rosen who publishes the Rosen Numismatic Advisory.
Last week, as the Dow breached the 14,000 mark for the first time, bullish swagger on Wall Street went into overdrive.
"History does not always repeat, but sometimes it rhymes." Mark Twain.
Many years ago I was blessed to make the acquaintance of one Samuel J. "Bud" Kress, a stock market cycle expert. Mr.
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Gold is using for heat dissipation in some cars.
