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-- Posted Wednesday, 19 November 2008 | Digg This Article | Source: GoldSeek.com
U.S. Stock Market - Sorry to say it but the U.S. stock market is getting uglier. The “bounce” off of the October lows has been feeble while breath is far uglier on down days versus up. Meanwhile, the fundamental news is getting worse. I believe Paulson’s “switch” from using the bailout monies to buy up toxic mortgages to ejecting it into banks, has been perceived as a slap in the face to Congress and that he continues to be flying by the seat of his pants (please read. http://finance.yahoo.com/news/TARP-A-Rescue-Plan-or-cnbc-13606550.html.) This has caused the “Big Money” (what’s left of it) to feel things are far worse than what Paulson has been letting on (please read http://www.nypost.com/seven/11162008/business/tarps_not_working_138932.htm). The feeling is all the horrible fundamental news (see http://articles.moneycentral.msn.com/Investing/JubaksJournal/whats-scary-about-this-recession.aspx) combined with the technical picture is going to take out the lows of October 10th and another leg down will follow. I fully believe this, so I continue to advise staying out of the market. If and when I do go back into the waters, I’m likely to be over-weighted in foreign stock markets versus the U.S. Russia, China and Hong Kong have my eyes right now. One sign of a potential U.S. stock market bottom is if and when the financial stocks (what’s left of them) lead the way to the upside. (Please read http://finance.yahoo.com/tech-ticker/article/129825/Citigroup-and-JPMorgan-Still-at-Risk-Says-Analyst?tickers=c,jpm,bac,%5Edji,%5Egspc) Gold – The physical market remains incredibly strong while the Comex market trades as if physical demand was weak. As this article suggests (http://www.nypost.com/seven/11182008/business/governments_cant_handle _global_run_on_go_139306.htm?page=0) something is fishy. I continue to suggest waiting on the sidelines with any new money until the paper gold price can climb above $775. Base Metals – Still on sidelines and this appears to be the place until at least the New Year. U.S. Dollar Index – While dollar spreads are continuing to be unwound, giving the dollar some support, upside momentum has waned. Once the short-covering is out of the way, I believe we shall witness a significant fall in the dollar. Oil – I’ve been on the sidelines since near the highs, but I’m getting itchy to pull the trigger. I think the time may come if I’m correct about another leg down in the stock market. Stay tuned. Mining and Exploration Shares – They, too, are likely to be pressured in a general stock market decline. We need gold above $775 to get some separation for gold stocks from general equities. Special Notes of Interest - I’ve felt that an Obama win would lead Israel to attack Iran’s nuclear sites before Obama’s inauguration. Please read. http://www.jpost.com/servlet/Satellite?cid=1226404771120&pagename=JPost%2FJPArticle%2FShowFull It’s becoming harder and harder for the average American family to cope. Please read and read and read http://www.msnbc.msn.com/id/27599570 http://www.iht.com/articles/2008/11/16/business/16consumer.php http://news.yahoo.com/s/afp/20081112/bs_afp/financeeconomyushealthsociety Yet another crisis brewing Please read and read http://finance.yahoo.com/tech-ticker/article/127657/Looming-Crisis-Unfunded-Pensions-Next-in-Line-for-a-Bailout?tickers=BA,VZ,GM,F,%5Egspc,KFT,X http://www.ft.com/cms/s/29c8e0c8-a3a0-11dd-942c-000077b07658,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F29c8e0c8-a3a0-11dd-942c-000077b07658.html%3Fnclick_check%3D1&_i_referer=&nclick_check=1 Unemployment is far worse than reported and will only get worse. Please read http://www.nypost.com/seven/11112008/business/the_sham_ful_jobs_report _needs_obamas_at_138092.htm Good news and bad news regarding CNBC-TV. As I noted previously, I no longer have Bloomberg News so I’ve been forced to watch CNBC-TV with the sound on (but my mute button is getting worn out). I’ve discovered one show very worthy of my time-Fast Money: real pros that aren’t mouthpieces for Wall Street firms and a reporter who seems to get it makes this the exception to the rule on CNBC-TV. The bad news is I watched another farce by staff of CNBC-TV yesterday morning. The show Squwak Box had a guest on who spoke about the Plunge Protection Team or PPT. Immediately, he was attacked and was being discredited. Over the years we’ve learned publicly that our government has intervened in the currency and bond market but these fools can’t accept this possibility. I believe this is so because they’re so dependent on the “Don’t Worry, Be Happy” crowd for their paychecks and to accept this would mean their pals were not fully on the up and up. Also, the lady Ms. Quick was in diapers when the 1987 crash occurred and everybody and his mother knew the Fed intervened in the S&P futures the day after the crash, which helped the market turnaround. It’s a shame that CNBC-TV continues to have guest after guest preach it’s time to buy while people like Peter Schiff and others, who actually forecasted this mess, are not on. Sorry folks, but this is mostly Tout-TV. Watch video http://www.youtube.com/watch?v=X06kz9dzXho Peter Grandich is Chief Commentator at Agoracom.com, Canada’s largest small-cap investment community and the only provider of monitored communities to public companies. Grandich is formerly publisher of the internationally-read Grandich Letter, which began publishing in 1984 and has amassed a loyal army of readers. Grandich’s commentary can now be viewed on his blog at www.Grandich.Agoracom.com.
-- Posted Wednesday, 19 November 2008 | Digg This Article | Source: GoldSeek.com
Peter Grandich is the Managing Member of Grandich Publications, LLC (www.grandich.com).
The company publishes The Grandich Letter (first published in 1984) which covers the metals and mining industry, follows world markets and economies, and covers the Canadian markets from an American prospective.
Grandich also provides a variety of corporate finance and development services to publicly-held companies.
Peter Grandich is also the Managing Member of Trinity Financial, Sports & Entertainment Management Company, LLC (www.trinityfsem.com), a Registered Investment Advisor in the State of New Jersey. Trinity provides investment advisory services to individuals, small to mid-size businesses, professional athletes and entertainers.
Peter is a long-standing member of The New York Society of Security Analysts and The Society of Quantitative Analysts.
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