We have reached the crucial phase in the stimulus cycle. This is something that I realized from the history of the stock market in relationship to our economy. The boom-bust business cycle is the work of Keynesian economics. Don't get me work. We have had boom-bust periods prior to his theory, but they fall under the old problems of over-capacity, tariff, trade and currency. Keynesian Theory says government should provide stimulus to cover downturns in the economy. My problem with him is there is no mention of re-paying government for the debt incurred by providing stimulus. This debt burden causes conflict in the bond market as government edges out private concerns for access to money. This is how inflation rises. Demand raises price. With interest rates rising, the price for money goes up. This is inflationary.
Enter the Fed
Modern central banks use monetary policy to stop this type of inflation. By controlling interest rates, central banks can engineer money. Lower interest rates and keep the price of money from rising. This is all well and good on paper except man is greedy. He will work the system. Of course, you can replace the word man for nations. Nations use many other types of manipulation to gain an edge. They use currency manipulation like Japan, China and EU. Nations can use tariffs like every nation in the world and the latest technique. They use regulations, however those concerns are not what is worrying the market today.
Market Today
The market is rising on the wall of worry. The market realizes that this stimulus, bull cycle is the longest on record. The evaluations are rising. Stocks are no longer cheap. The Fed entered the equation by changing policy. They began to raise rates, This caused a knee jerk response by the market. To counter this action, the new president put pressure on the Fed to lower rates, again. Then, we had conflict in the other areas of the economy, mainly tariffs and trade. On the surface all those influences added a gloomy projection to the market and to the economy. However, there was an inner feeling that a trade deal would happen and the Fed will do what the market wants, be accommodative. This battle between the bulls and bears became more evident as we enter the earnings season.
Earnings, Cap Ratio and GDP
As I say in my unpublished book, all things are connected. Earnings have been rising in relationship to the GDP since the 1990s. Historically, there is a cap ratio between earnings and GDP. The average is 80 and the highest level was 148 back in 2000. Then, we had the dot.com bust. Today, the level is 146. This is your wealth gap. The market cap is 80% higher than the norm. This is trouble in a big way. With that info, there are other, more deeply concerns behind the scenes. The banks reported solid earnings, but the transports hit bear territory in June. They could not rise to their old high while the rest of the market was hitting new highs. This discrepancy showed when CSX, a very large railroad reported a terrible quarter. They used excuses like the weather, but core business was weak. The other two main railroads reported earnings that met expectations. So, what does this mean? We have to look at the market leaders to see more evidence or we can listen to the views of two CEOs.
Morgan Stanley vs. Blackrock
The CEO of Morgan sees trouble ahead. Take your money out and wait to a better reentry point. Blackrock says, "Stay the course!" Sebastian offers this view...
*FB = is in a sideways action.
*NFLX = is down 70 points from high.
*AMZN = is trading sideways.
*GOOG = is down 150 points from high
*MSFT = is up at record levels.
Result = in conclusive.
Other Important Indicators
The semiconductor industry has pre-warned the market. They claim not to meet expectations. We have seen this movie before. CEOs sandbag and then, report better earnings. We will see shortly.
However, we do have solid evidence with a manufacturer in Fastenal. This giant firm is worth $17 billion. They had a bad quarter with an even worse outlook. Peter Boockvar at Bleakley Advisory says, "Global manufacturing is in retraction." The Shanghai Exchange plummeted last week. Next, we have the airlines. According to Boeing, the fix on the 737 Max would be done by now. The reality is maybe by January 2020? In addition, the company will take a $5 billion charge and they also said costs are rising. Not good. They are not alone, Textron, an aerospace giant, also reported a weak quarter and weaker outlook. Then, the most important commodity, oil. There is a glut and the outlook says oil firms will enter a bear market. Finally, the auto industry. Sales are steady even with prices rising. On the flip-side auto loan delinquency is rising. This is bad for bond loans and the economy in general. Many of the above issues has seen the transports fall steeply from its high. This poses a conflict in Dow Theory which requires both indexes to rise concurrently. Adding the pluses and minuses leads to the next point which has Sebastian siding with Morgan Stanley.
Bank of International Settlements(BIS)
They reported that corporations in the US have added $9 trillion in debt. They estimate that one in six companies are walking dead or zombies. A zombie corporation is one that does not meet expenses with its budget. They borrow cheap money and banks lend in this low interest environment. This is how they stay in business. It is blood for Dracula CEOs. If one derivative or missed payment happens, this horror film will burst on the scene. By the way, China is an empire of zombie firms. Anyway, banks realize that these firms could be toxic. They bundle these loans into collateralized obligations(CLOs). They are presented as high-yield investments. Pension funds, hedge funds and mutual buy them.
Covenant lite
For bond holders it means no protection. After bankruptcy, you get next to nothing. Case in point: Last Friday, 4L Technologies dived. Moody's says it will default. This is what the BIS study refers too. This is spreading the disease. This is repeating the sins of 2008. Now, those high-yield
junk bonds are showing up in the yield curve in the most dreaded fashion: the inverted yield. If banks get nervous like with the Fed tightening, they will stop lending. This will kill the zombie firms. Banks are first in line for assets, but bond holders get screwed. This destroys lending and bonds which causes layoffs and then, a recession. Maybe this is the real reason why the Fed is indicating another change in monetary policy. Back to rate cuts. Back to cheap money. Eventually, this leads to inflation. Bottom line: If you want to be able to afford to go to the movies to see this horror film, get some gold.
Wednesday, July 24, 2019
Wednesday, July 17, 2019
Debt + $ = $Crisis
The one big problem with democracy is when people with money and influence cause a change in our society. There are many examples, but there are two that I feel is the dry rot that is a danger to the American way of life and the global community.
The Fed
When the bankers found their footing with lobbyists and campaign donations, they were rewarded with the founding of the Federal Reserve. The reserve means the banking industry has protection. The taxpayers become their back-up. This violated the constitution because the endgame was fiat money over the gold standard. This is where the wealth gap begins. This is the beginning in the decline of our standard of living. The value of our dollar declines which is inflation that you do not see, but it is very real. They even changed economic thinking to say that credit was an asset. Credit is debt. Debt is a liability. Bottom line of the Federal Reserve: the US has the greatest liabilities in the world. Now, think about this: the global economy is slowing and the blame is on tariffs. Not all true. Every nation has tariffs. The only change was the US adding to the equation. The real culprit is credit. World credit has retracted by 40%. This is what has effected the Chinese economy the most. The US use to be the engine for the world. China has been playing that role for over a decade until the dangers of credit and debt began to surface. During this period credit has grown fourfold to $41 trillion from $9 trillion back in 2009. No one knows what real assets are in the world's banks. They all lie just like President Johnson who had the Vietnam war costs off the books. Who can say for sure what are the real debt figures. The derivative market is where I see the real danger of a panic in currencies and to the global community. Just look at Deutsche Bank. In the EU, Germany has the biggest and strongest economy and yet, their biggest bank is technically bankrupt. It is around only because of the ego of the German government. We are no better. I read somewhere that some analysts says the total US debt is $72 trillion which is 350% of our GDP. Those numbers are scary, but deceiving. Most of the debt ($52T) is social security. It is misleading because the costs are spread out over time and it is funded. What is really scary are things that are legislated, but overlooked like insurance for tall buildings since 9/11? How about the government sponsored flood program that covers both coasts? How about all those secret military programs? The list goes on-and-on and all based on worthless, fiat Fed money. The US citizen will suffer in the end due to fiat policies, the Fed and our corrupt, so-called leaders who allowed this to happen. The signs are not just written on the subway walls. Read on!
Military
The pentagon got to close to the government during WWII. With too much money and influence, the seeds for continual power developed. The military used any and every opportunity to gain the public's attention as well as Congress. By spreading military contracts to all states, the military had influence to all politicians. This is why the US budget allows 50% or more to the military. It is another violation of the thinking of the founding fathers, "Do not get involved with foreign affairs." The military has troops in over 100 countries. This is wrong!
Fed + Miltary
This is an alliance of mutual interest over the interest of the citizen. The Fed creates wealth for the elite and provides money for the military. The military looks the other way on the debt issue because they believe that the money lenders will solve the problem one way or another. They are both guilty of greed, ego and beliefs. Together, the two evils are spending what the nation cannot afford. It leads too...
More debt does not solve old debt...
it just pushes back to a later date with even more debt until it collapses. This is what happens to all fiat based economies. It is why the USSR failed. They put all their wealth into the military until they no longer could finance the debt. This would have happened to the US years ago if we were not the world's reserve currency. We are not alone. Every nation in the world prints paper. The citizen just hopes that the people in power know what they are doing. They don't!
Debt Ceiling...
is in the news again. Dear Reader, if you look closely at the last time this occurred and even prior to that, our national debt has exploded past $20 trillion. Sebastian predicted this would happen when it was at $13 trillion. Anyway, each time a consensus is reached, the debt allocated to finance the government is always more than enough to cover one full year. In reality, the new debt level is spent long before the fiscal year ends. This is the sad direction of our so-called leaders, both democrats and republicans. This is what is happening now. They need more money, again!
Some politicians are pushing for a two year plan. They say just add another $500 billion. This is money for the military (republicans) and social programs (democrats). People, $500 billion is more money than all of the US debt from our beginning until 1975 which includes WWII and Vietnam.
This is a failure to manage the government, the currency and our economy. By the way, Reagan who ran on cutting big government was the first to push the deficits over $1 trillion.
Want more proof? Here is a recap since the last crisis in 2008. Our central bank, the Fed has instituted three rounds of QE and they cut interest rates to zero. Why so much, you might ask? Because the US is the biggest debtor and if we maintained normal interest rates, the dollar would have collapsed along with our government and economy. Fortunately, we are not alone. Every nation reacted in the same manner (a fool and his money).
The world is floating on the sea of debt in a water logged, fiat papered boat. Banks needed a new plan. Central banks came up with this plan. They will buy government debt even if no one else would. They could drop rates below zero or negative. This means a bond is worth less in the end than the purchase price. This is failure! Then, some central banks supported their stock exchanges (read wealthy) by buying shares of stocks. They control the media and the dialogue as if there really was a dialogue. Things have gotten so bad that US companies are buying into the game. Ford purchased a negative bond which guarantees that they will lose money over the long haul for cash today. Remember when all those shills use to say, "Don't buy gold, it doesn't pay interest?" Gold was legislated out of paying interest, but the idiots can't stop gold from maintaining value to which it has always done. This is the same argument for Bitcoins. People, a digital notation is no comparison to the metal that does not tarnish.
Anyway, my point is this: fiat money is losing value every minute while gold does not and it could increase in value to any and all currencies. Gold does not look for cash today, but it takes the long view. At one time it was used to back the pound. Then, it was used to back the dollar. One cannot know what lies beyong the next mountain, but gold will hold its own no matter the outcome. Gold is an asset and assets trump liabilities. This aspect is reflected by our founding fathers who put the precious metal in our constitution. Enough said.
The Fed
When the bankers found their footing with lobbyists and campaign donations, they were rewarded with the founding of the Federal Reserve. The reserve means the banking industry has protection. The taxpayers become their back-up. This violated the constitution because the endgame was fiat money over the gold standard. This is where the wealth gap begins. This is the beginning in the decline of our standard of living. The value of our dollar declines which is inflation that you do not see, but it is very real. They even changed economic thinking to say that credit was an asset. Credit is debt. Debt is a liability. Bottom line of the Federal Reserve: the US has the greatest liabilities in the world. Now, think about this: the global economy is slowing and the blame is on tariffs. Not all true. Every nation has tariffs. The only change was the US adding to the equation. The real culprit is credit. World credit has retracted by 40%. This is what has effected the Chinese economy the most. The US use to be the engine for the world. China has been playing that role for over a decade until the dangers of credit and debt began to surface. During this period credit has grown fourfold to $41 trillion from $9 trillion back in 2009. No one knows what real assets are in the world's banks. They all lie just like President Johnson who had the Vietnam war costs off the books. Who can say for sure what are the real debt figures. The derivative market is where I see the real danger of a panic in currencies and to the global community. Just look at Deutsche Bank. In the EU, Germany has the biggest and strongest economy and yet, their biggest bank is technically bankrupt. It is around only because of the ego of the German government. We are no better. I read somewhere that some analysts says the total US debt is $72 trillion which is 350% of our GDP. Those numbers are scary, but deceiving. Most of the debt ($52T) is social security. It is misleading because the costs are spread out over time and it is funded. What is really scary are things that are legislated, but overlooked like insurance for tall buildings since 9/11? How about the government sponsored flood program that covers both coasts? How about all those secret military programs? The list goes on-and-on and all based on worthless, fiat Fed money. The US citizen will suffer in the end due to fiat policies, the Fed and our corrupt, so-called leaders who allowed this to happen. The signs are not just written on the subway walls. Read on!
Military
The pentagon got to close to the government during WWII. With too much money and influence, the seeds for continual power developed. The military used any and every opportunity to gain the public's attention as well as Congress. By spreading military contracts to all states, the military had influence to all politicians. This is why the US budget allows 50% or more to the military. It is another violation of the thinking of the founding fathers, "Do not get involved with foreign affairs." The military has troops in over 100 countries. This is wrong!
Fed + Miltary
This is an alliance of mutual interest over the interest of the citizen. The Fed creates wealth for the elite and provides money for the military. The military looks the other way on the debt issue because they believe that the money lenders will solve the problem one way or another. They are both guilty of greed, ego and beliefs. Together, the two evils are spending what the nation cannot afford. It leads too...
More debt does not solve old debt...
it just pushes back to a later date with even more debt until it collapses. This is what happens to all fiat based economies. It is why the USSR failed. They put all their wealth into the military until they no longer could finance the debt. This would have happened to the US years ago if we were not the world's reserve currency. We are not alone. Every nation in the world prints paper. The citizen just hopes that the people in power know what they are doing. They don't!
Debt Ceiling...
is in the news again. Dear Reader, if you look closely at the last time this occurred and even prior to that, our national debt has exploded past $20 trillion. Sebastian predicted this would happen when it was at $13 trillion. Anyway, each time a consensus is reached, the debt allocated to finance the government is always more than enough to cover one full year. In reality, the new debt level is spent long before the fiscal year ends. This is the sad direction of our so-called leaders, both democrats and republicans. This is what is happening now. They need more money, again!
Some politicians are pushing for a two year plan. They say just add another $500 billion. This is money for the military (republicans) and social programs (democrats). People, $500 billion is more money than all of the US debt from our beginning until 1975 which includes WWII and Vietnam.
This is a failure to manage the government, the currency and our economy. By the way, Reagan who ran on cutting big government was the first to push the deficits over $1 trillion.
Want more proof? Here is a recap since the last crisis in 2008. Our central bank, the Fed has instituted three rounds of QE and they cut interest rates to zero. Why so much, you might ask? Because the US is the biggest debtor and if we maintained normal interest rates, the dollar would have collapsed along with our government and economy. Fortunately, we are not alone. Every nation reacted in the same manner (a fool and his money).
The world is floating on the sea of debt in a water logged, fiat papered boat. Banks needed a new plan. Central banks came up with this plan. They will buy government debt even if no one else would. They could drop rates below zero or negative. This means a bond is worth less in the end than the purchase price. This is failure! Then, some central banks supported their stock exchanges (read wealthy) by buying shares of stocks. They control the media and the dialogue as if there really was a dialogue. Things have gotten so bad that US companies are buying into the game. Ford purchased a negative bond which guarantees that they will lose money over the long haul for cash today. Remember when all those shills use to say, "Don't buy gold, it doesn't pay interest?" Gold was legislated out of paying interest, but the idiots can't stop gold from maintaining value to which it has always done. This is the same argument for Bitcoins. People, a digital notation is no comparison to the metal that does not tarnish.
Anyway, my point is this: fiat money is losing value every minute while gold does not and it could increase in value to any and all currencies. Gold does not look for cash today, but it takes the long view. At one time it was used to back the pound. Then, it was used to back the dollar. One cannot know what lies beyong the next mountain, but gold will hold its own no matter the outcome. Gold is an asset and assets trump liabilities. This aspect is reflected by our founding fathers who put the precious metal in our constitution. Enough said.
Wednesday, July 10, 2019
First Retail, Now Restaurants
The sad state of US retail cannot be blamed on trade tensions, outsourcing or imports. It dates back to overexpansion in the 1980s. It seemed like any and every vacate intersection was game for development. Thus, we grew malls, regional shopping centers, basic shopping centers, strip-store shopping and factory outlets all over the nation.
The timing was perfect in the aspect that factory jobs were being outsourced and these opportunities offered employment, especially for people who were being displaced by the lost of their previous employer. A few years later, those same workers became disillusioned with their new employment. Wages were stagnant. There were no benefits, no pensions and little opportunity for advancement. The main reason nothing was done politically, was because the individual was disenfranchised. Even with the advent of the internet, we are still just one voice crying aloud, and in this case, crying in digital.
History Repeats
Although this multi-generation of workers got the short end of the stick by the wealthy producers in America who outsourced our labor, they had one thing in common that gave them hope - their homes. Home values would provide a nest egg in lieu of a pension and or, higher wages saved in bank accounts. There were also some token measures by some good Congress members with IRAs and 401s. Together, all these factors kept workers working in low paying jobs because they could see a decent retirement.
A New Crisis
The plan hit not just a pot-hole, but a road cave-in. Somewhere along the journey of life, the housing phenomena grew beyond belief. You know the old expression, "If it's too good to be true, it is!" Well, people began speculating with their homes. They saw and read where their neighbors sold and made overnight all that they could have saved over the years, if they had a better paying job. They heard tales of unemployed who took a beat-up, fixer-upper and now, they are on easy street. People took the plunge. They did not think that by selling their $50,000 home for $200,000, the ramifications of their choice. They purchased a $300,000 McMansion. Then, they flipped this showplace for a $400,000 no money down and no verification required speculation home. They did not stop to think about real financing. Everybody was doing it and banking was going along, so what's to worry?
Financing 101
Let's do a quick math application. To make a deeper impression, I am going to use the present, lower interest rates to calculation the basic financing requirement for a $400,000 super-home back in 2006.
You would need to make at minimum $1600 plus per week. Dear Reader, there is no need to tell you that retail in any form or level does not pay those type of numbers. By the way, that possible buyer had better have no car payments, credit card debt or other financial obligations like student debt. No one had those middle-class income numbers. Slowly, but surely, the flippers got flipped. The parade ended in the show rooms of new subdivisions. The party was over. Now, those speculators must come up with $2,000 plus every month to pay the mortgage. We all know what happened.
Enter Today
The Obama stimulus along with the Fed cutting interest rates to zero, spurred the business cycle to begin anew. The problem was to find a quality job that paid a living wage. This is still the problem. It is why the middle-class is shrinking. The tragedy of outsourcing is that America was hope for the world. We had the provided the highest opportunity for advancement - social mobility. Today, we are number 40 and SINKING! This is the wealth gap. It will be a sad day in America when we have only two classes: affluent and poor. This is the curse of European aristocratic thinking. It is killing the American dream.
Anyway, people are not dump. They could see where retail was going, especially with the advent of the internet and Amazon. Restaurants on the other hand, were thriving. There were opportunities for advancement and tips along the way. People eat out as much as they love to shop. It became a job magnate.
Problem?
Most restaurants went where the shoppers went: malls, shopping centers, etc. As those locations suffered due to loss of anchors like Sears, J. C. Penny, et al. those shopping districts became less desirable. Restaurants became collateral damage. This is part two to the growing Armageddon in retail. Part three would be the individual shops like a tailor, shoemaker, repairman, etc. Stats on those failures or successes are difficult to assemble, but they too are going by way of the Dodo Bird. I like the idea of small business Saturday. This concept is to support small business on the day after Black Friday. However, once a year is to little and probably too late.
Anyway, I see two other problems in what is taking place in the market. The first and foremost is the advantage of the internet over foot traffic. No sales tax. Congress better make up and give brick and mortar a equal playing field. The second is more subtle. The growing use of the I-phone to pay a purchase. Money is financial independence. We have been led by convenience of checking, credit and now, digital over a cash transaction. People, this is setting you up for a serious crisis. If the banks shut off your credit line, you are broke. Repeat that! You will have no financial freedom. You will be subject to state control. This is evil beyond comprehension.
Enough said. The collateral damage to restaurants is alarming. Here is a list that are on the same road as Radio Shack. There are other reasons for failure among the primary is overexpansion, menu change and changing demographic core customers. Some are not going out of business, but are declining in nature as competition is fierce.
*Fuddruckers - not closing, but severe sales decline.
*HomeTown Buffet - loss of customers by demographics.
*Ruby Tuesday - collateral damage in shopping area.
*Friendly's - changing demographics and competition.
*Tim Horton's - overexpansion from Canada.
*Papa John's - descension.
*Eat 'n Park - declining sales, competition.
*Quiznos - declining sales, demographics and competition.
*Carl's Jr. - declining sales, demographics and competition.
*Steak 'n Shake - demographics and competition.
*O' Charley's - declining sales, competition.
*Starbucks - Yes, the coffee chain is safe, but sales are falling rapidly and competition is growing.
*Polo Tropical - overexpansion.
*Pizza Rev - Kramer's idea - make your own. Sorry, Cosmo. This is a no go.
*IHOP - declining sales, demographics and menu change.
*Johnny Carino's - location.
*PDQ (People Dedicated to Quality) - overexpansion.
*Subway - menu and corporate pricing with franchises, declining sales, demographics.
*Papa Murphy's - variation of Kramer's idea with the same results - no go.
*Village Inn - demographics.
*Pie Five - overexpansion.
*Potbelly - same problem as Subway and declining sales.
*Luby's - location and declining sales.
*Applebee's - in transition, sales falling.
*Chipotle - health scare, repeatedly. Management, expansion and competition.
The list is long and keep in mind that these are chains which means you have to multiply the number of locations with the number of workers. Not Good!
The timing was perfect in the aspect that factory jobs were being outsourced and these opportunities offered employment, especially for people who were being displaced by the lost of their previous employer. A few years later, those same workers became disillusioned with their new employment. Wages were stagnant. There were no benefits, no pensions and little opportunity for advancement. The main reason nothing was done politically, was because the individual was disenfranchised. Even with the advent of the internet, we are still just one voice crying aloud, and in this case, crying in digital.
History Repeats
Although this multi-generation of workers got the short end of the stick by the wealthy producers in America who outsourced our labor, they had one thing in common that gave them hope - their homes. Home values would provide a nest egg in lieu of a pension and or, higher wages saved in bank accounts. There were also some token measures by some good Congress members with IRAs and 401s. Together, all these factors kept workers working in low paying jobs because they could see a decent retirement.
A New Crisis
The plan hit not just a pot-hole, but a road cave-in. Somewhere along the journey of life, the housing phenomena grew beyond belief. You know the old expression, "If it's too good to be true, it is!" Well, people began speculating with their homes. They saw and read where their neighbors sold and made overnight all that they could have saved over the years, if they had a better paying job. They heard tales of unemployed who took a beat-up, fixer-upper and now, they are on easy street. People took the plunge. They did not think that by selling their $50,000 home for $200,000, the ramifications of their choice. They purchased a $300,000 McMansion. Then, they flipped this showplace for a $400,000 no money down and no verification required speculation home. They did not stop to think about real financing. Everybody was doing it and banking was going along, so what's to worry?
Financing 101
Let's do a quick math application. To make a deeper impression, I am going to use the present, lower interest rates to calculation the basic financing requirement for a $400,000 super-home back in 2006.
You would need to make at minimum $1600 plus per week. Dear Reader, there is no need to tell you that retail in any form or level does not pay those type of numbers. By the way, that possible buyer had better have no car payments, credit card debt or other financial obligations like student debt. No one had those middle-class income numbers. Slowly, but surely, the flippers got flipped. The parade ended in the show rooms of new subdivisions. The party was over. Now, those speculators must come up with $2,000 plus every month to pay the mortgage. We all know what happened.
Enter Today
The Obama stimulus along with the Fed cutting interest rates to zero, spurred the business cycle to begin anew. The problem was to find a quality job that paid a living wage. This is still the problem. It is why the middle-class is shrinking. The tragedy of outsourcing is that America was hope for the world. We had the provided the highest opportunity for advancement - social mobility. Today, we are number 40 and SINKING! This is the wealth gap. It will be a sad day in America when we have only two classes: affluent and poor. This is the curse of European aristocratic thinking. It is killing the American dream.
Anyway, people are not dump. They could see where retail was going, especially with the advent of the internet and Amazon. Restaurants on the other hand, were thriving. There were opportunities for advancement and tips along the way. People eat out as much as they love to shop. It became a job magnate.
Problem?
Most restaurants went where the shoppers went: malls, shopping centers, etc. As those locations suffered due to loss of anchors like Sears, J. C. Penny, et al. those shopping districts became less desirable. Restaurants became collateral damage. This is part two to the growing Armageddon in retail. Part three would be the individual shops like a tailor, shoemaker, repairman, etc. Stats on those failures or successes are difficult to assemble, but they too are going by way of the Dodo Bird. I like the idea of small business Saturday. This concept is to support small business on the day after Black Friday. However, once a year is to little and probably too late.
Anyway, I see two other problems in what is taking place in the market. The first and foremost is the advantage of the internet over foot traffic. No sales tax. Congress better make up and give brick and mortar a equal playing field. The second is more subtle. The growing use of the I-phone to pay a purchase. Money is financial independence. We have been led by convenience of checking, credit and now, digital over a cash transaction. People, this is setting you up for a serious crisis. If the banks shut off your credit line, you are broke. Repeat that! You will have no financial freedom. You will be subject to state control. This is evil beyond comprehension.
Enough said. The collateral damage to restaurants is alarming. Here is a list that are on the same road as Radio Shack. There are other reasons for failure among the primary is overexpansion, menu change and changing demographic core customers. Some are not going out of business, but are declining in nature as competition is fierce.
*Fuddruckers - not closing, but severe sales decline.
*HomeTown Buffet - loss of customers by demographics.
*Ruby Tuesday - collateral damage in shopping area.
*Friendly's - changing demographics and competition.
*Tim Horton's - overexpansion from Canada.
*Papa John's - descension.
*Eat 'n Park - declining sales, competition.
*Quiznos - declining sales, demographics and competition.
*Carl's Jr. - declining sales, demographics and competition.
*Steak 'n Shake - demographics and competition.
*O' Charley's - declining sales, competition.
*Starbucks - Yes, the coffee chain is safe, but sales are falling rapidly and competition is growing.
*Polo Tropical - overexpansion.
*Pizza Rev - Kramer's idea - make your own. Sorry, Cosmo. This is a no go.
*IHOP - declining sales, demographics and menu change.
*Johnny Carino's - location.
*PDQ (People Dedicated to Quality) - overexpansion.
*Subway - menu and corporate pricing with franchises, declining sales, demographics.
*Papa Murphy's - variation of Kramer's idea with the same results - no go.
*Village Inn - demographics.
*Pie Five - overexpansion.
*Potbelly - same problem as Subway and declining sales.
*Luby's - location and declining sales.
*Applebee's - in transition, sales falling.
*Chipotle - health scare, repeatedly. Management, expansion and competition.
The list is long and keep in mind that these are chains which means you have to multiply the number of locations with the number of workers. Not Good!
Wednesday, July 3, 2019
Hypocrites and Phonies
The big G-20 Summit in Japan has come and gone. The politicians returned to their respective nations and all declared that things are getting better: if you only do as I say, excuse me, suggest. President Trump made a gambit to use for his re-election in 2020. He was very close to North Korea. Why not try and get some future relations with that nation after the two non-fruitful meetings? He succeeded in one aspect, now he can say during his re-election campaign that he is the only sitting president to step foot in North Korea. However, did he get any results in the nuclear arms agenda? No! This is BS! Dear Reader, this is baseball season. In baseball if you whiff after three swings, you're out. Trump struck out!
North Korea has played this nuclear card threat game for 50 years. They know that they have their big Communist brother, China backing them up. This takes me back to the political games just prior to the summit.
Bullying!
The Chinese premier, XI stated that China would not be bullied into any trade deals. Without naming names, we all know that he was referring to President Trump and his use of tariffs. This guy has gall beyond gall! He is the poster child for Hypocrites!
China demands that any company wishing to enter the Chinese market, agree to become a Chinese company. This means that Apple in China is a Chinese company as well as Mercedes and every other entity that does business in China.
The demands get worse! Every company must transfer its technology or blueprint of their
product to which they may manufacture to sell there or export. This is how the Chinese steal product knowledge and by-pass patents. Our government was corrupt in allowing our companies to do business with China with those demands. The guilt is in both the Republicans and Democrats to which is why we say here at Evolution of Democracy that we need a third political party in the US. That party should begin with two basic ideas: Protect US workers and end our military use at our border.
By the way, China has some of the highest tariffs in the world along with Japan and the EU. They are all BS artists! If you are keeping score, this is the third time tariffs swing for a hit in the trade talks. The negotiations struck out. That's two down or two outs, whatever you prefer.
The bond market has been screaming inversion! Alan Greenspan just said, "The bond market is in a bubble. This will be the crisis." Folks, the inning is over because this is the third out. Recession is coming! If you doubt that prediction, here is a recap of the democratic debate.
Democratic Debate
Did you watch any of this? I tuned it in. To be honest, there is only so much crap that I can bear to hear. With that said, I found these two points that I want to rant upon.
1) The moderators are programmed idiots! You can see that after you realize the questions that they ask and how the many issues inter-relate.
2) There was no one there that should be our president. The only member of the ten among the Democrats that showed any truthful and thoughtfulness behind her answers was Maryanne Williamson.
Where to begin?
Healthcare...
was a topic for both nights. My rants is addressed to the second night. Every candidate had a motion about healthcare. Biden still backs the Obama, ACA. The rest pushed a variation of Medicare for all. This is where I enter. Neither the moderator nor any candidate explained the facts about Medicare.
First of all, Medicare is a paid plan. When you reach the age of 65, you must pay into the plan whether you use it or not. If you delay collecting Social Security, this expense is costly. Bernie says his plan is like the First Payer Plan. My understanding of that plan is that it is a free medical program that is paid by the government for everybody and it covers everything. Medicare only covers 80% and it does not cover everything. By the way, Bernie says that taxes will go up to pay for his version to which has not been revealed as of yet.
None of the candidates or the moderators ever mentioned the fact that Medicare is like medical insurance. You have to pay into it and it does not cover every medical need with a 20% gap that the individual must cover.
The next issue shows the complete phoniness of senator, Kamala Harris and congressman, Beto O'Rourke.
The moderator changed the topic to the illegals at the Southern Border. She asked, "Would you allow medical to illegals?" The question is not even a question. The moderator should know that any illegal who enters a US hospital will receive health care at the US taxpayer's expense. In addition, the two states that suffer the most expenses due to this medical aspect is, California and Texas. Neither candidate that I mentioned above answered this question truthfully. Why, you ask? Because they want the Hispanic vote. They should have stated the truth. Many illegals enter the US to receive free medical. They know this. They also know if a woman gets pregnant and she can slip across the border, the pluses multiply. She gets free medical. Her child automatically becomes a US citizen to which she can use to enter the US. You read it here, but you didn't hear it there. God help America because none of the Democrats will.
North Korea has played this nuclear card threat game for 50 years. They know that they have their big Communist brother, China backing them up. This takes me back to the political games just prior to the summit.
Bullying!
The Chinese premier, XI stated that China would not be bullied into any trade deals. Without naming names, we all know that he was referring to President Trump and his use of tariffs. This guy has gall beyond gall! He is the poster child for Hypocrites!
China demands that any company wishing to enter the Chinese market, agree to become a Chinese company. This means that Apple in China is a Chinese company as well as Mercedes and every other entity that does business in China.
The demands get worse! Every company must transfer its technology or blueprint of their
product to which they may manufacture to sell there or export. This is how the Chinese steal product knowledge and by-pass patents. Our government was corrupt in allowing our companies to do business with China with those demands. The guilt is in both the Republicans and Democrats to which is why we say here at Evolution of Democracy that we need a third political party in the US. That party should begin with two basic ideas: Protect US workers and end our military use at our border.
By the way, China has some of the highest tariffs in the world along with Japan and the EU. They are all BS artists! If you are keeping score, this is the third time tariffs swing for a hit in the trade talks. The negotiations struck out. That's two down or two outs, whatever you prefer.
The bond market has been screaming inversion! Alan Greenspan just said, "The bond market is in a bubble. This will be the crisis." Folks, the inning is over because this is the third out. Recession is coming! If you doubt that prediction, here is a recap of the democratic debate.
Democratic Debate
Did you watch any of this? I tuned it in. To be honest, there is only so much crap that I can bear to hear. With that said, I found these two points that I want to rant upon.
1) The moderators are programmed idiots! You can see that after you realize the questions that they ask and how the many issues inter-relate.
2) There was no one there that should be our president. The only member of the ten among the Democrats that showed any truthful and thoughtfulness behind her answers was Maryanne Williamson.
Where to begin?
Healthcare...
was a topic for both nights. My rants is addressed to the second night. Every candidate had a motion about healthcare. Biden still backs the Obama, ACA. The rest pushed a variation of Medicare for all. This is where I enter. Neither the moderator nor any candidate explained the facts about Medicare.
First of all, Medicare is a paid plan. When you reach the age of 65, you must pay into the plan whether you use it or not. If you delay collecting Social Security, this expense is costly. Bernie says his plan is like the First Payer Plan. My understanding of that plan is that it is a free medical program that is paid by the government for everybody and it covers everything. Medicare only covers 80% and it does not cover everything. By the way, Bernie says that taxes will go up to pay for his version to which has not been revealed as of yet.
None of the candidates or the moderators ever mentioned the fact that Medicare is like medical insurance. You have to pay into it and it does not cover every medical need with a 20% gap that the individual must cover.
The next issue shows the complete phoniness of senator, Kamala Harris and congressman, Beto O'Rourke.
The moderator changed the topic to the illegals at the Southern Border. She asked, "Would you allow medical to illegals?" The question is not even a question. The moderator should know that any illegal who enters a US hospital will receive health care at the US taxpayer's expense. In addition, the two states that suffer the most expenses due to this medical aspect is, California and Texas. Neither candidate that I mentioned above answered this question truthfully. Why, you ask? Because they want the Hispanic vote. They should have stated the truth. Many illegals enter the US to receive free medical. They know this. They also know if a woman gets pregnant and she can slip across the border, the pluses multiply. She gets free medical. Her child automatically becomes a US citizen to which she can use to enter the US. You read it here, but you didn't hear it there. God help America because none of the Democrats will.
Wednesday, June 26, 2019
Odds and Ends: June 2019
May has passed; June is about to join it with the book on the Federal Reserve to be opened. It will confirm what J P Morgan has stated, "There is an 85% chance that the Fed will cut rates this year." The day after the June meeting had Fed governors saying that they feel a cut is needed due to the usual suspects: trade tensions and tariffs, geopolitical concerns, etc.
Morgan Stanley Business Condition Index...
is an example of information that is more consistent in data value than the political dangers of tariffs and regional conflicts. Granted, it is not the only business index. Bloomberg has a great commodity index and there are many more out there to draw conclusions as the real character of our economy. Anyway, according to the index, it fell an astonishing 32 points. Anything with that type of change is eye opening. This index hit the same level as in 2008 and we all know what that translates too. The normal range in this index is 55 and Morgan Stanley says it is now 13! This is a serious red flag. By the way, if you are keeping score, this goes next to the inverted rate yield for a double bogey.
Speaking of Interest Rates
The US ten year note is falling and I mean falling. It dropped below 2%. The Fed has not as of yet changed course, however the market reacts as if it had. The ECB is ready to cut rates. Japan is the poster child for low rates. Switzerland leads everyone in the race to negative bonds. At the moment there are $12 trillion in negative bonds circulating. The most are in the EU and Japan with 50% in government bonds and another 20% in corporate notes. The contagion is spreading. Our ten year could reach 1.73% next year. Yeah, you lock up your money for ten years. You put $1,000 in the bank and you make $1.73 in interest. This is proof that fiat money and the Fed has failed! End the Fed!
P.S. lowering of interest rates is also a form of currency manipulation. For those of you who watch the dollar as we do at this blog, you will notice this: 3 Black Crows formed in the recent dollar retreat. This is a negative pattern in the dollar. It also indicates that even if the dollar rallies, it will again test the lows.
Cyber Warfare
a little known component to the defense bill says, "...the military can use its own discretion and without presidential approval to deter and eliminate any dangerous cyber actions." This is the type of dangerous authority that can lead to war when with a little more thought prevention, an internet roadblock can be found. Idiots!
Picture Tells a Story
in the 1990s, we were addressing our national deficits and even had a surplus. China was not an economic power or threat and our exports were as high as 57%. Today, our national deficit is in a technical bankruptcy level. China is an economic power and threat. Our exports are down to 16%. The reason behind all this economic disaster is outsourcing, military budget and a lack of taxes to the wealthy or tariffs to protect workers. The political parties can attack each other until it all falls apart or take a look at the big picture and do something that will benefit all Americans and our way of life.
Keep in mind that Republicans were against Medicare and its costs. Wake Up! The interest alone in the 2020 budget will exceed the costs of Medicare. We are entering Doo-Do Land.
Oil Tanker Attacks...
was in the news. The US was quick to put the blame on Iran. Dear Reader, the answer is simple. For years industry has used the "Clad Melt." You use an explosive charge to weld two metals. There is metal in mines, torpedoes and all higher explosive charges. The explosion of the charge will melt into the metal of the oil tanker. All that is needed is to dissect the remains. Then, you can see where the metal was forged and have a clearer picture of who the culprit might be rather than using the medium as a platform to support political views or worse. Facts speak louder than BS!
S & P at Record High
This reborn rally is very dangerous. Four tech stocks (Facebook, Microsoft, Amazon and Google) account for 25% of the rise in prices. If there is no trade deal, these four will decline to which could translate into a serious correction to the entire market. The real safe choice and one that benefits with a declining dollar is gold. A word to the wise...
Sky Sail
Have you heard of this new idea in freight cargo carriers? The ship extends a kite-like sail very high above the carrier as it floats on the water. The sail gathers wind like wooden ships of old to pull the boat along the water. Crazy as it sounds, it works! This technique could save cargo ships $2 billion a year in fuel costs. This is a beautiful idea.
Catch 22 in Housing
The lowering of interest rates has caused a resumption to the housing and real estate market. Lower rates help buyers afford the high price of homes, however more buyers in homes makes for still higher prices. Home sales surged in May, but the price rise was also the best in two years. This could be a blow-off rally because the spring season was a failure and summer is the last, best shot this market has to make this year an up market. The data yesterday does not look good in the tea leaves at the bottom of the cup.
Trucking...
was one of my many jobs in life. The state of trucking shows revenues in serious decline. Retail is suffering due to the dangers of tariffs and competition with e-commerce. This has caused the spot prices for truck cargo to drop. Keep in mind that the trade amount between the US and Mexico is $347 billion and 85% of it moves through trucking. I guess the Grateful Dead are dead!
Taxes...
nobody likes them, but they are a necessary evil. Here is one that I can get behind. Tax the foreign earnings of US companies that outsourced their plants to other lands. The only chance America has to right our ship is to bring back good, high paying jobs. This will also help state and federal government with revenues and hopefully, somebody gets a bill out there to balance the budget. In fact, I would go even further to get jobs back in the US. I would declare that any company that has outsourced its factory to be a foreign company. Then, I put a tariff tax on all their products that they
make elsewhere and import to the US market. If it's not made in America, it is not American!
Morgan Stanley Business Condition Index...
is an example of information that is more consistent in data value than the political dangers of tariffs and regional conflicts. Granted, it is not the only business index. Bloomberg has a great commodity index and there are many more out there to draw conclusions as the real character of our economy. Anyway, according to the index, it fell an astonishing 32 points. Anything with that type of change is eye opening. This index hit the same level as in 2008 and we all know what that translates too. The normal range in this index is 55 and Morgan Stanley says it is now 13! This is a serious red flag. By the way, if you are keeping score, this goes next to the inverted rate yield for a double bogey.
Speaking of Interest Rates
The US ten year note is falling and I mean falling. It dropped below 2%. The Fed has not as of yet changed course, however the market reacts as if it had. The ECB is ready to cut rates. Japan is the poster child for low rates. Switzerland leads everyone in the race to negative bonds. At the moment there are $12 trillion in negative bonds circulating. The most are in the EU and Japan with 50% in government bonds and another 20% in corporate notes. The contagion is spreading. Our ten year could reach 1.73% next year. Yeah, you lock up your money for ten years. You put $1,000 in the bank and you make $1.73 in interest. This is proof that fiat money and the Fed has failed! End the Fed!
P.S. lowering of interest rates is also a form of currency manipulation. For those of you who watch the dollar as we do at this blog, you will notice this: 3 Black Crows formed in the recent dollar retreat. This is a negative pattern in the dollar. It also indicates that even if the dollar rallies, it will again test the lows.
Cyber Warfare
a little known component to the defense bill says, "...the military can use its own discretion and without presidential approval to deter and eliminate any dangerous cyber actions." This is the type of dangerous authority that can lead to war when with a little more thought prevention, an internet roadblock can be found. Idiots!
Picture Tells a Story
in the 1990s, we were addressing our national deficits and even had a surplus. China was not an economic power or threat and our exports were as high as 57%. Today, our national deficit is in a technical bankruptcy level. China is an economic power and threat. Our exports are down to 16%. The reason behind all this economic disaster is outsourcing, military budget and a lack of taxes to the wealthy or tariffs to protect workers. The political parties can attack each other until it all falls apart or take a look at the big picture and do something that will benefit all Americans and our way of life.
Keep in mind that Republicans were against Medicare and its costs. Wake Up! The interest alone in the 2020 budget will exceed the costs of Medicare. We are entering Doo-Do Land.
Oil Tanker Attacks...
was in the news. The US was quick to put the blame on Iran. Dear Reader, the answer is simple. For years industry has used the "Clad Melt." You use an explosive charge to weld two metals. There is metal in mines, torpedoes and all higher explosive charges. The explosion of the charge will melt into the metal of the oil tanker. All that is needed is to dissect the remains. Then, you can see where the metal was forged and have a clearer picture of who the culprit might be rather than using the medium as a platform to support political views or worse. Facts speak louder than BS!
S & P at Record High
This reborn rally is very dangerous. Four tech stocks (Facebook, Microsoft, Amazon and Google) account for 25% of the rise in prices. If there is no trade deal, these four will decline to which could translate into a serious correction to the entire market. The real safe choice and one that benefits with a declining dollar is gold. A word to the wise...
Sky Sail
Have you heard of this new idea in freight cargo carriers? The ship extends a kite-like sail very high above the carrier as it floats on the water. The sail gathers wind like wooden ships of old to pull the boat along the water. Crazy as it sounds, it works! This technique could save cargo ships $2 billion a year in fuel costs. This is a beautiful idea.
Catch 22 in Housing
The lowering of interest rates has caused a resumption to the housing and real estate market. Lower rates help buyers afford the high price of homes, however more buyers in homes makes for still higher prices. Home sales surged in May, but the price rise was also the best in two years. This could be a blow-off rally because the spring season was a failure and summer is the last, best shot this market has to make this year an up market. The data yesterday does not look good in the tea leaves at the bottom of the cup.
Trucking...
was one of my many jobs in life. The state of trucking shows revenues in serious decline. Retail is suffering due to the dangers of tariffs and competition with e-commerce. This has caused the spot prices for truck cargo to drop. Keep in mind that the trade amount between the US and Mexico is $347 billion and 85% of it moves through trucking. I guess the Grateful Dead are dead!
Taxes...
nobody likes them, but they are a necessary evil. Here is one that I can get behind. Tax the foreign earnings of US companies that outsourced their plants to other lands. The only chance America has to right our ship is to bring back good, high paying jobs. This will also help state and federal government with revenues and hopefully, somebody gets a bill out there to balance the budget. In fact, I would go even further to get jobs back in the US. I would declare that any company that has outsourced its factory to be a foreign company. Then, I put a tariff tax on all their products that they
make elsewhere and import to the US market. If it's not made in America, it is not American!
Wednesday, June 19, 2019
On Your Mark, Get Set, Go!
The days of being on the track team are long gone. The title is not a prep for track and field, but a call to anyone out there that would like to get on a shooting star before it crosses the sky.
On the internet you see adds every day from hawkers about their new find. They claim it will be like buying Amazon at $3 per share or getting in on an IPO like Google. In a way, I and this piece is not any different except my readers know that I rarely push a stock. If I do recommend something, I put my money where my digital letters form on the page (in this case, WPM).
Dear Reader, it is time to put on your gold chains because the chains of manipulation on precious metals is coming to an end. Even the naysayers of yesterday are waiting at the station to get on the train.
The list grows every day and former naysayers are even adjusting their price range. This is basically covering your ass and a last gap method to limit the price rise of gold. You know the shills for the Fed and fiat money. No need to recap their names. On the positive side: Steve Sjuggerud, Bank of America, Stanley Druckenmiller, Paul Tudor Jones, Doug Casey and the crew of this blog.
Love Train - O'Jays
...Tell all the folks in Russia and China, too
Don't you know that its time to get on board
And let this train keep on riding, riding on through
Join hands - Start a love train
You may recall the song. John Lennon said he thought it was one of the best rock songs ever even though the O'Jays were a disco group.
You might think that this is all well and good, but you want some fundamental facts or maybe you would like to know what the charts are saying. People, it's all good.
On the positive list Doug Casey offers these four points:
1) Basel III - the Bank for Settlements(BIS) issued a new accord for transactions. It said that gold holdings by central banks will be classified as a 0% risk asset. This is huge! This is recognition of gold by a leading central bank for the first time in 50 years.
2) Central Banks - are buying gold. This aspect changes both perception and character of gold. Russia and China are the biggest buyers. This is seen as nations look for an alternative to US dollars which carry excessive debt and politics.
3) Oil for Gold - Yes, you read that right. China, seeking to avoid US dollars will pay an equivalent amount of gold for oil suppliers as an exchange in the transaction. Keep in mind that the oil market is 10x larger than the gold market and China is the largest importer of oil.
4) Fed - no longer looking to raise interest rates, but they may cut. If this happens, it lowers the value of the dollar and raises the price of gold.
Excessive Debt
Sebastian wants readers to remember that the US is technically bankrupt. Japan is worse. Don't forget the EU with its phony pledge of just 3% over budget with debt. In fact, all fiat based economies which includes Russia and China too. They all have excessive debt and they all are just one false derivative away from financial Armageddon. Gold will retain its value.
One Negative
At the moment, Bitcoin is seeking to gather investors to it by claiming this non-political aspect. It is the only stumbling block to gold's advance. Don't fall for this siren call. Bitcoin is worthless digital print. You lose your code; you lose your money. If there is a run on the firm selling these coins, they will go under as they have no tangible backing other than the internet. Hackers can steal or destroy a website. All central banks oppose it. As they say on Arthur Ave. in the Bronx, "Forget about it!"
What the Charts say...
Gold is above its 50 and 200-day average. Gold rallied in January 2018, but failed at resistance. It declined all the way to $1200 in October 2018. Then, it began another rally which took it to $1350, resistance. It retraced and now, it is approaching resistance again except with stronger volume. More people in the store, more sales.
For those of you that like patterns, my stock of choice, WPM is displaying a bull flag which is a continuous of trend pattern.
The future looks as shiny as a gold chain. When $1350 is breached, the next point of resistance is $1400. If this rally has enough strength and breaks the $1400 level, there is no resistance until $1650.
Now, that is a train you want to ride...
...if you miss it, I fell sorry, sorry for you. Everybody! Got a love train, love train...
On the internet you see adds every day from hawkers about their new find. They claim it will be like buying Amazon at $3 per share or getting in on an IPO like Google. In a way, I and this piece is not any different except my readers know that I rarely push a stock. If I do recommend something, I put my money where my digital letters form on the page (in this case, WPM).
Dear Reader, it is time to put on your gold chains because the chains of manipulation on precious metals is coming to an end. Even the naysayers of yesterday are waiting at the station to get on the train.
The list grows every day and former naysayers are even adjusting their price range. This is basically covering your ass and a last gap method to limit the price rise of gold. You know the shills for the Fed and fiat money. No need to recap their names. On the positive side: Steve Sjuggerud, Bank of America, Stanley Druckenmiller, Paul Tudor Jones, Doug Casey and the crew of this blog.
Love Train - O'Jays
...Tell all the folks in Russia and China, too
Don't you know that its time to get on board
And let this train keep on riding, riding on through
Join hands - Start a love train
You may recall the song. John Lennon said he thought it was one of the best rock songs ever even though the O'Jays were a disco group.
You might think that this is all well and good, but you want some fundamental facts or maybe you would like to know what the charts are saying. People, it's all good.
On the positive list Doug Casey offers these four points:
1) Basel III - the Bank for Settlements(BIS) issued a new accord for transactions. It said that gold holdings by central banks will be classified as a 0% risk asset. This is huge! This is recognition of gold by a leading central bank for the first time in 50 years.
2) Central Banks - are buying gold. This aspect changes both perception and character of gold. Russia and China are the biggest buyers. This is seen as nations look for an alternative to US dollars which carry excessive debt and politics.
3) Oil for Gold - Yes, you read that right. China, seeking to avoid US dollars will pay an equivalent amount of gold for oil suppliers as an exchange in the transaction. Keep in mind that the oil market is 10x larger than the gold market and China is the largest importer of oil.
4) Fed - no longer looking to raise interest rates, but they may cut. If this happens, it lowers the value of the dollar and raises the price of gold.
Excessive Debt
Sebastian wants readers to remember that the US is technically bankrupt. Japan is worse. Don't forget the EU with its phony pledge of just 3% over budget with debt. In fact, all fiat based economies which includes Russia and China too. They all have excessive debt and they all are just one false derivative away from financial Armageddon. Gold will retain its value.
One Negative
At the moment, Bitcoin is seeking to gather investors to it by claiming this non-political aspect. It is the only stumbling block to gold's advance. Don't fall for this siren call. Bitcoin is worthless digital print. You lose your code; you lose your money. If there is a run on the firm selling these coins, they will go under as they have no tangible backing other than the internet. Hackers can steal or destroy a website. All central banks oppose it. As they say on Arthur Ave. in the Bronx, "Forget about it!"
What the Charts say...
Gold is above its 50 and 200-day average. Gold rallied in January 2018, but failed at resistance. It declined all the way to $1200 in October 2018. Then, it began another rally which took it to $1350, resistance. It retraced and now, it is approaching resistance again except with stronger volume. More people in the store, more sales.
For those of you that like patterns, my stock of choice, WPM is displaying a bull flag which is a continuous of trend pattern.
The future looks as shiny as a gold chain. When $1350 is breached, the next point of resistance is $1400. If this rally has enough strength and breaks the $1400 level, there is no resistance until $1650.
Now, that is a train you want to ride...
...if you miss it, I fell sorry, sorry for you. Everybody! Got a love train, love train...
Wednesday, June 12, 2019
50 Years Ago - Could it Happen Again?
My friend asked me the question in memory of the 1969 Mets. When I was a kid, my answers were always clouded with my own personal hopes. Today, I look at the big picture. His fun question activated something deeper in my mind.
D-Day...
was in the news with the 75th Anniversary of the turning point in WWll. Our fathers fought so bravely and well. They had a cause and a will because they believed in their effort would be best for all. Sadly, our government has abused the thought what is best for all to what is best for the bureaucrats of the pentagon.
Following Aristocratic Model
If you study Europe, you can see that our government is making the same mistakes that developed by the egos of the aristocrats and elite of Europe. The first real world war was against Napoleon.
After Napoleon was defeated in 1815, the concept of "Balance of Power" emerged on the continent. This was like our present nuclear power standoff. The idea was no nation alone could dominate. You needed allies and politics kept all allies on equal footing. The exception was Russia. They were determined to become a power. They wanted a warm naval port to increase trade and grow their economy. On the map they saw a weakness in the Ottoman Empire and a location of a warm trading port on the Black Sea. Their egos went to war. They lost. They still want the warm naval port and Putin grab it last year.
Anyway, Germany and Italy along with a few other European nations began their battle for unification which was to become one nation state. Their success had many ramifications. Germany was the center of it all. Unification was only the beginning.
Germany or Prussia as it was called at the time also wanted to expand. Keep in mind until recently, the winner of a war wanted a spoil which meant land. France objected under balance of power. Result: war. France lost and the concept of balance of power began to fade.
Dark Continent...
was spotted next by every ego driven, aristocrat in Europe. This led to taking of land in Africa and countless wars so the elite could get richer. Then, they looked elsewhere.
Asia...
became the next target. Their disease of imperialism spread to America. Our nation got infected with the concept except we called our version, Manifest Destiny. We went to war with Spain and we got Hawaii. We also got involved with Puerto Rico and Cuba along with the Philippines. We got entangled with the Boxer Rebellion in China. Our military began to exert power in government. The problem for the military was our society believed in what our founding fathers preached, peace at home and peace abroad. Switzerland showed you could be neutral and we copied that model.
War to End All Wars...
is what Woodrow Wilson said as he pushed the US into World War 1. This is the worst president. His bullshit, elite thinking help make the military a power in our government. He backed the formation of the Federal Reserve which he knew was against the idea of the gold standard as expressed by our founding fathers. These two points is the root cause in the decline of the philosophical concept of America and Liberty.
Before the 20th anniversary of WWI, the world was at war again and every twenty years or so, the pentagon pushes us into another useless, wasteful war that destroys our freedom, our lives and our way of life under the banner of our national interests. These idiots are bankrupting our nation and yet, they claim that they are keeping us safe. The founding fathers knew not to get involved with other
nations affairs and that is our national interest.
These were the thoughts that surged through my mind as the numbers triggered other thoughts. To answer his question, no way are the Mets going to win the world series. In addition, baseball is no longer our national past time. Today, football reigns supreme. With that said his question is something that no one is talking about. How cosmic vibes become alive in the culture. He is right about one thing. In 1969 our nation was in transition. Protests in the streets was a daily accord along with the body count from the wasteful, stupid war in Vietnam. The year began with the Super Bowl. The old AFL began to battle the original NFL for the championship. The N. Y. Jets were the biggest underdog ever. Nevertheless, they won. Their league was equal to the NFL. Change was in the air.
The Vibe of 1969
The vibe was in the air. The protesting kids against the war, for the climate and for civil rights were labeled, "hippies." "They" love to put labels on things as if that explains everything. Todays label is populism. They get you to talk about the label and not the ideas. Anyway, the kids gathered in upstate New York. They closed the interstate at Woodstock, New York. The Mets completed the trifecta. The change in the air would result in a change in our society.
Today
Maybe the first sign of a vibe is in the NBA. If the Toronto Raptors beat the more powerful and champion Golden State Warriors, the vibe will connect with society. A parlay could emerge if the Cleveland Browns of the NFL win the Super Bowl. These dogs have been last forever, but the vibe is out of the bottle. However, there needs to be the third leg to complete the triple crown. Who knows? Maybe the trade tensions will lead to new formations like a trade zone in North America whereby we coordinate to protect each others economy and jobs versus the global community? Maybe the transition from gas engines to electric along with a new appreciation for alternative energy that protects the earth, climate, water and soil? Maybe something else? Who knows? Time will tell.
D-Day...
was in the news with the 75th Anniversary of the turning point in WWll. Our fathers fought so bravely and well. They had a cause and a will because they believed in their effort would be best for all. Sadly, our government has abused the thought what is best for all to what is best for the bureaucrats of the pentagon.
Following Aristocratic Model
If you study Europe, you can see that our government is making the same mistakes that developed by the egos of the aristocrats and elite of Europe. The first real world war was against Napoleon.
After Napoleon was defeated in 1815, the concept of "Balance of Power" emerged on the continent. This was like our present nuclear power standoff. The idea was no nation alone could dominate. You needed allies and politics kept all allies on equal footing. The exception was Russia. They were determined to become a power. They wanted a warm naval port to increase trade and grow their economy. On the map they saw a weakness in the Ottoman Empire and a location of a warm trading port on the Black Sea. Their egos went to war. They lost. They still want the warm naval port and Putin grab it last year.
Anyway, Germany and Italy along with a few other European nations began their battle for unification which was to become one nation state. Their success had many ramifications. Germany was the center of it all. Unification was only the beginning.
Germany or Prussia as it was called at the time also wanted to expand. Keep in mind until recently, the winner of a war wanted a spoil which meant land. France objected under balance of power. Result: war. France lost and the concept of balance of power began to fade.
Dark Continent...
was spotted next by every ego driven, aristocrat in Europe. This led to taking of land in Africa and countless wars so the elite could get richer. Then, they looked elsewhere.
Asia...
became the next target. Their disease of imperialism spread to America. Our nation got infected with the concept except we called our version, Manifest Destiny. We went to war with Spain and we got Hawaii. We also got involved with Puerto Rico and Cuba along with the Philippines. We got entangled with the Boxer Rebellion in China. Our military began to exert power in government. The problem for the military was our society believed in what our founding fathers preached, peace at home and peace abroad. Switzerland showed you could be neutral and we copied that model.
War to End All Wars...
is what Woodrow Wilson said as he pushed the US into World War 1. This is the worst president. His bullshit, elite thinking help make the military a power in our government. He backed the formation of the Federal Reserve which he knew was against the idea of the gold standard as expressed by our founding fathers. These two points is the root cause in the decline of the philosophical concept of America and Liberty.
Before the 20th anniversary of WWI, the world was at war again and every twenty years or so, the pentagon pushes us into another useless, wasteful war that destroys our freedom, our lives and our way of life under the banner of our national interests. These idiots are bankrupting our nation and yet, they claim that they are keeping us safe. The founding fathers knew not to get involved with other
nations affairs and that is our national interest.
These were the thoughts that surged through my mind as the numbers triggered other thoughts. To answer his question, no way are the Mets going to win the world series. In addition, baseball is no longer our national past time. Today, football reigns supreme. With that said his question is something that no one is talking about. How cosmic vibes become alive in the culture. He is right about one thing. In 1969 our nation was in transition. Protests in the streets was a daily accord along with the body count from the wasteful, stupid war in Vietnam. The year began with the Super Bowl. The old AFL began to battle the original NFL for the championship. The N. Y. Jets were the biggest underdog ever. Nevertheless, they won. Their league was equal to the NFL. Change was in the air.
The Vibe of 1969
The vibe was in the air. The protesting kids against the war, for the climate and for civil rights were labeled, "hippies." "They" love to put labels on things as if that explains everything. Todays label is populism. They get you to talk about the label and not the ideas. Anyway, the kids gathered in upstate New York. They closed the interstate at Woodstock, New York. The Mets completed the trifecta. The change in the air would result in a change in our society.
Today
Maybe the first sign of a vibe is in the NBA. If the Toronto Raptors beat the more powerful and champion Golden State Warriors, the vibe will connect with society. A parlay could emerge if the Cleveland Browns of the NFL win the Super Bowl. These dogs have been last forever, but the vibe is out of the bottle. However, there needs to be the third leg to complete the triple crown. Who knows? Maybe the trade tensions will lead to new formations like a trade zone in North America whereby we coordinate to protect each others economy and jobs versus the global community? Maybe the transition from gas engines to electric along with a new appreciation for alternative energy that protects the earth, climate, water and soil? Maybe something else? Who knows? Time will tell.
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