A "Golden" Time

- There are no good or bad stocks - only rising and falling stocks.

- Nicolas Darvas

King $Dollar

We expressed our concern about the dollar many times. We advised you to keep an eye on it. Have you? Well, it recently broke its support level at $104.99. It also broke its up trendline and on strong volume. This is big. The underlying problem for the dollar is debt. We all know the stated inbalance of revenues and expenditures. The government says that our debt stands at $31.46 trillion as of May 2023. Dear Reader, it is triple that figure. The debt report does not include benefits like social security and medicare. There are countless off the books billions to the military and other clandestine activities. There is also the little discussed fact that with higher interests rates, the compound total of debt multiplies rapidly. The Federal Reserve has put us in a dangerous position. 

Furthermore, we read that China is seeking to develop an alternative to the dollar in global trading. The BRICKS are real even though their efforts have not dented the dollar's strength and value in trading. However, it shows opposition. It shows change. To overlook threats is like Marie Antoinette, "Let them eat cake!" The poor in France had no bread and could not afford what was available. History has more than one reference to complaints by citizens about their government and their standard of living. The Czar in Russia. King George 111 in England with the American colonies. Our present leaders put the threats out of the news and on the back burner. We don't. There are many others who share our concerns. Central banks have been buyers of gold to have a reserve if something disturbs the market and the dollar. We know what could cause that disturbance. It is debt. 

Gold

It is in our constitution. The greedy and corrupt got us off the gold standard and away from the ideas and values of our founding fathers. The short sighted military leaders (read Pentagon) influenced presidents to appease allies to use our nation as a dumping ground for their exports. They threw a bone to producers by allowing outsourcing. Deficits became normal. After all, we are the reserve currency for the world. There is nothing to worry about. Ask the idiot, Dick Cheney, "Deficits don't matter."

We have abused the privilege. However, there is one refuge for our economic well being. It is the pecious metals. All the negatives about our foreign policy and deficit spending are pointing to a moment. Whatever happens, one thing is for sure, the staus quo will do anything to maintain power and gold will hold its value. It is not just that. It will return to prominence. It will rise in value. With that said, how does it stand with Darvas's quote?

Consolidation

Gold rises and then, it falls. Why, you ask? Because the fiat forces conspire against it. It is a constant battle that forms a lid on gold's advances in price. We always fear when JP Morgan Chase says, "That gold's time to shine is now." They just declared that. There brother in fiat arms is Goldman Sacks. They buy gold to use it later in a shorting process. This is their playbook. They sell the gold that they purchased and at the same time, short the precious metals.

Update Alert: Last weekend the overnight price action in gold burst to a new all-time high. When gold opened in New York, it immediately fell by $50 bucks. This is fiat attacking gold before it gets into everyone's radar. 

It will not work this time. The charts tell us that gold has broken out of a four year consolidation pattern. We also know that the longer the consolidation, the greater the breakout. When you combine this data with the recent price drop in the dollar, we see a floor in the price of gold. We also see a relationship in the falling dollar to the rising price in gold. It appears for each one point drop in the dollar, gold rises $100 dollars. Keep an eye on this coorelation. If we are corrct, the dollar should test its next resistance point at $101.5. If it does, gold should break to a new all-time high around $2290. 

If you cannot afford the bullion, we like Barrick Gold (GOLD) Wheaton Precious Metals (WPM) and a inexpensive, small miner, Argonaut Gold (ARNGF), 

While this may be great for us as investors, I worry about ordinary cirizens. Folks, whether the market rises or falls, people need to make ends meet. A falling dollar will put inflation back into our lives. It will make poor people fall to poverty. The rich like Marie cannot grasp the conditions of the poor until they protest on the street. It could be too late by that time.      Peace.  

Odds and Ends: November 2023

The year is almost over. This holiday season we, at Evolution would like you to remember all the information that we provided. Our predictions to which the majority of them, were correct and free of charge. We say this not to toot our horn, but keep it in mind because we have decided to self-publish our book. We need your support when it happens. Thank you.

LEI

The conference board of leading indicators has now fallen 19 months in a row. This only backs up our conclusion that we are in a "stealth recession." Everything is skewed by the government to make whatever administration is in power, to look good. They massage and manipulate all the data. We don't. How about unemployment? The shenanigans began in the 1930s. Look at the...

Population

The estimate is 333.29 million citizens. We have no idea on how many undocumented people are living among us. Anyway, the labor bureau says the current labor force is 164.29 million strong. Dear Reader, that figure drops to 132.34 million full-time employees to which means that there are more people without work (169 million) than are working. We did some math. There are 69 million receiving social security and or, benefits. This leaves us with around 100 million or more than any country in Europe less Russia. There are 73 million young people, but the stat includes all students. This means that 27 million citizens are unaccounted for and as far as the government is concerned, do not exist. So much for the labor stat of 3.9% unemployment. How about...

Inflation

The government says it has dropped to 3.2%. We say this is a lie because it does not provide the compound rate of inflation. It means that prices have risen another 3.2% to the previous inflated level from 2022 and does not show how this ingrained menace adds costs when you look at the previous years 2021 and 2020 and 2019. Milton Friedman said it best, "Inflation is always and everywhere a monetary phenonmenon". The Federal Reserve has been on a 6.5% trendline of money printing since 2011. In 2019, they exploded by adding another $5 trillion. The printing press now sits at $4 trillion over the trendline. Inflation is not going away. Will you join our chorus, "End the Fed!"

King $Dollar

It broke support at 105. The next stop is 101.5. This is great for commodities. See next week's info on projections. Each full percentage basis tick adds to inflation. With that said, those low gasoline prices will soon spike. 

Last Tidbit

Filings show that 50 more firms are no longer in operation. Gone. Over. Belly-up. The total for the year is 561 and counting. This represents more than 2-per day every business week. This is another indicator that reflects the weakness in our economy. After you read and digests these facts, one must realize that we need a new political party that supports citizens and workers. One party that does what is best for all Americans and gives the truth. One that explains what it does and why.   Peace. 

Changed Outlook

We stated last December that our nation and economy is in a "stealth recession." One of our decisive indicators was the labor participation rate. It stood at a little over 62%. When we added inflation to those poor numbers, we knew people were hurting no matter what President Biden or Jerome Powell of the Federal Reserve said. 

We also knew that 48% of our labor force is in service be it trucking, retail or similar. We put two-and-two together. The conclusion would be a slow-down in these firms that would result in layoffs and bankruptcies. We were correct on that aspect. However, what we didn't know until now is this: what happened to those employees who lost their job?

Do the Math

We did. Beginning from a full employment level which correlates to a 69% participation rate and the actual 62% rate. Our estimate is 10-12 million workers. We also knew many women left the labor force due to COVID. Many have not returned. They are among the lost workers. So, how did these people adjust to a life without a paycheck?

Disability

Ambulance lawyers fill nighttime television on smaller channels with ads. One of their best and most repeated sound bites concerns unemployment, "Maybe your lost job has caused you mental distress and or, other internal problems? Maybe you filed a claim and you were rejected? No longer. We're here to help." These type of lawyers are gaming the system. We all lose.

They take a piece of your benefit, and they generally win. We now have the answer to where all those who lost a job have gone. There are 12 million people in the age group of 18-64 who collect on the dole. This has nothing to do with unemployment insurance. This is a separate agency. Even if a new plant came into their district that offered employment, these check-living souls would not seek to reenter for employment. Why risk a sure thing when this company may pack up and leave after a few years? This new psyche is terrible. It goes against our American character of self-reliance. It goes against our optimistic outlook. This is very sad.

It Gets Worse

The above disability claims are predominantly men who are over 30. The younger group (18-30) are wasting away in their parents home. They found a hobby that makes them happy in their present state. They are not on drugs, per se. They are abdicted to video games. They have friends locally, nationally and internationally on the internet. They will wake up one morning to their 30th birthday with no job, no relationship skills and no future. There are untold millions like this who are not looking for work or continuing with ther education. Many cannot afford college and living in the present does not force them to feel that they need to change their lifestyle.

3.9%

That is the stat released by the government for our unemployment rate. It really is around 15%. This lie is covered with disability payments. Then, you add the millions of immigrants on the border and we will go from the most productive nation ever, to one that is living by government subsidence. This will lead to a more declining standard of living. When neighborhoods decline in value, people will burn their homes for insurance to flee because no one will buy them. These potential negative spiral needs action now before it is too late. We have nothing against compassion, but people need more than meeting rent and food on the table. We need to feel safe. We need a purpose. We need to know and trust our neighbors. We need belief in a better tomorrow. When you outsourced jobs, you put a nail into a coffin for our American way of life. The greedy, the Republicans, the Democrats and the Federal Reserve are all guilty.  

We Conclude:

The market bulls are placing bets that the Fed is done with rate hikes. They see a return to the way "things get done." We don't. The market may continue to rally, but our economy is built on sand. There are too many problems for everyday people to make ends meet. $King Dollar has peaked. This will help the market, but hurt the rest of us. Inflation is now ingrained and all it needs and what we see is this: more worker unrest and more strikes in 2024. One geopolitical disturbance like one that affects oil and a wave will disrupt the market's present thinking. We believe that the haves will sell at the next high. If you look for distribution selling, this will confirm our belief. If we enter a recession by government standards, things will take a turn for the worst. AI and robotics will take millions of jobs. This will not be an overnight occurrence. It will be like the weather, sunny in some places and raining in others. The result is danger. It could lead to social unrest. Let us hope that the government stops using our nation as a dumping ground for foreign products. We need more tariffs on all imports. There are other options. Our water solution could be the answer, but first our book needs to be published.  Even with this pessimistic outlook, be of good cheer and try to have a wonderful and blessed Thanksgiving. Peace.

Fed, Market and Peace Killers

We promised some more jabs at the Fed this week, as well as some market views, however, we feel some comments on the conflict in the Holy Land are in order.

Fed First

With every crisis they seek to expand their power and control over our economy and lives. They now can buy from the marketplace mortgage-backed securities, courtesy of the latest disturbance in the economy. Soon, they will seek to purchase stocks. The lie will be to save the nest egg of many. They will be covering the big boys. 

We predict that as many as (5) five more banks will need to be bailed out in the coming months. Of course, they will cover their asses. This is their real purpose. They will probably arrange for the largest banks to gobble them up and become even bigger. Remember too big to fail? This is what they are doing. Anyway, we further predict that within six months large commercial management firms and building owners will file for bankruptcy. The Fed realizes this too. This is one reason for their pause and possible rate cut. The coming debt on loans to these firms is coming due. It exceeds $17 trillion. All their actions weaken the value of the dollar which makes our standard of living decline even further. When these things happen, don't think that we have a crystal ball. There are many who think like us, but we all need to get on the same meme, End the Fed!

Near-term Market Outlook

The Dow as well as the NASDAQ rose higher than we thought. Thinking about this price action, we concluded that the market feels the Fed is done in interest rate hikes. They began placing bets. However, the charts tell us that resistance volume is stronger than the upward volume. We could be wrong. The target resistance points will seal the decision. We stated that the economy is in a "stealth recession." We feel that we are correct as we see inflation is ingrained and the dollar's rise has peaked. Here are our price levels to watch and study the volume in the movement.

INDU = 35,000. On a weekly chart this is in the upper range, consolidation level.                                      Trans = 15,200.  On a weekly chart this too is in the upper range of consolidation.                                    SPX = Strong resistance at 4500. This is also in the upper range of consolidation on a weekly chart.        NASDAQ = This has been the strongest index. It has resistance at 14,500. Upper-level consolidation.

Peace Killers

The Middle-East region has been in conflict ever since the creation of Israel. After years of murdering attacks on each other with open conflict of war on many occasions, peace seekers found their voice. Israel's greatest warrior, Yitzhak Rabin led the charge. Yasser Arafat was the leader of Palestine in resistance to the very idea of Israel. President Clinton pushed both sides to the peace table. After many ups and downs, the two finally made a deal. What happened, you ask?

Old Palestine Observation

- Palestine will never miss a chance to lose an opportunity.

Arafat recognized Israel's right to exist and recognized their borders. Rabin pulled back expansion land that previously was recognized as Palestine. He would recognize Palestine as a nation. 

Many Palestinas called Arafat a traitor. A group called; Hamas began. These extremists stated that they would never accept Israel as a nation. They call for continuous war with Israel until it ceases to exist. Arafat lived the remainder of his life like a prisoner in his compound because Hamas would seek to assassinate him.

In Israel, many called Rabin a traitor. Before peace could be given a chance, a Jewish extremist assassinated Rabin. 

This only shows that there are extremists on both sides.

Luke's Gospel

He writes what Jesus said, "A man who cannot be just with little, can never be just with much."

Prime minister Netanyahu was just starting out during Rabin's peace effort. He was against the peace treaty. He had little power, but now he has much power. There will never be peace with him calling the shots. Israel needs to elect a peacemaker. 

With that said, the real problem is idiots and extremists are on both sides. I suggest "Tough love."

Why do we offer Israel $114 billion in aid when Hamas does not have one tank or aerial aircraft? Our support should have been tied to a peace effort. Now, what JFL suggests is not in the tradition of love, but it is logical. We should not provide humanitarian aid or any assistance to Palestine. We should not provide any assistance to Israel. Let the idiot radicals kill each other off. Then, when each citizen in each domain has had enough bloodshed and the peacemakers find their voice again, let us offer a table to find what He commands, "Love thy neighbor as thyself."                            Peace. 

Fed Speaks, Now Us

The Federal Reserve is bluntly obvious. They have resorted to this technique for the last six months. One month prior to their scheduled meeting, they take turns addressing the media. They are using the media as their BS, bully pulpit.  Here is a sample from October. Of course, we know that they did nothing at the meeting with rates, but BS to the nation.

Philly Fed President, Patrick Harker:

"Absent a stark turn in what I see in the data and hear from contacts...I believe that we are at the point where we can hold rates where they are."

Fed Chairman, Powell:

"Additional evidence of persistently above-trend growth, or tightness in the labor markets is no longer easing, could put further progress on inflation at risk and could warrant further tightening of monetary policy." 

Atlanta Fed President, Raphael Bostic:

"I really do try to keep people focused on what inflation is still at 3.7%. Our target is 2%. We have to get a lot closer to the 2% before I would consider any relaxing of our posture."

Fed Chairman, Powell:

"Financial conditions have tightened significantly in recent months, and longer-term bond yields have been an important driving factor in this tightening. We remain attentive to these developments because persistent changes in financial conditions can have implications for the path of monetary policy."

Minnesota Fed President, Neel Kashkari:

"It is certainly possible that higher long-term yields may do some of the work for us in terms of bringing inflation back down, but if those higher long-term yields are higher because their expectations about what we're going to do has changed, then we might actually need to follow through on their expectations in order to maintain those yields."

Dallas Fed President, Lorie Logan:

"If long-term interest rates remain elevated because of higher term premiums, there may be less need to raise the fed fund rate. However, to the extent that strength in the economy is behind the increase in long-term interest rates, the FOMC may need to do more."

Fed Reserve Member, Christopher Waller:

"While there is some basis for expecting inflation will continue to fall, let me remind you, as I have done repeatedly, that we have seen a string of good inflation reports evaporate multiple times in recent past. So, I will be watching the next several reports for clearer indications that inflation is on a trajectory to 2%." 

Boston Fed President, Susan Collins:

"With rates in restrictive territory, I do expect that payroll growth and economic activity more generally will slow in the coming months."

Our Two Cents

What the Fed members did not address or mention is this: Interest of US debt is now over $1 trillion. This is destroying our nation. This growing negative now consumes 15.9% of the entire budget. They never admit or address their role in the "boom and bust" economic policies instituted by them. They make interest rates artificially low for the boom and then raise them high for the bust. They will be the reason as to why the global community will seek to end the dollar as the world's reserve currency. It is why we say, "End the Fed!"

Our View on Inflation

Workers at Chipotle earn $20 bucks an hour in California. We predicted last December that in 2023, workers would strike, mainly because of inflation. We see many more strikes in 2024 with this news.

Is your oil a little low in your vehicle? Well, a can of oil that used to sell for less than a dollar, now costs $5.99 Ouch! Remember the Christmas Hess truck? When they raised the price from $2.99 to $4.99, I thought no one would buy. I was wrong. Flash forward to today. The Christmas truck goes for over $42. Are you kidding me!? Inflation is not only not going away, but worse, it is ingrained. When you check your oil and decide on a different present at the gas station, as your vehicle fills up, don't let the lower price fool you. The winter blend for gasoline is cheaper to produce, but OPEC still controls 40% of the product and they want higher pricing. The two wars will not help the situation.

The recent rally in the market should stall. It is at resistance. The dollar is central for the next market move. We will have more on the Fed and our economy and inflation next week.    Peace.

Choice of the Founding Fathers

- Sun, sun, sun here it comes...

- George Harrison

Gold

People ask people who buy gold, why? We will only answer for ourselves. We realize the wisdom of the founding fathers who chose the precious metal to back our initial currency. It would provide stability in pricing (read anti-inflation). It would ensure that future leaders of the nation kept spending in a balanced form (read no deficit spending). It would be accepted everywhere and the thrifty would be rewarded with social mobility. There are other reasons. They are all good. However, the corrupt understood the limitations it placed on them to expand, control and of course, get rich. Many came to America with money from their aristocratic families. They sought the easiest way to get money, through banking. It is why the attempt to form a national bank was opposed. The founders knew debt is a danger in all its forms. Nevertheless, the rich keep plotting. They keep trying. In their heart they do not believe that all men are created equal. They fight against social mobility and workers to be paid fairly.

Flash Forward

The nation experienced a series of bank runs that ended up as recessions for the nation. Looking back at those boom and busts situations, we see two basic reasons. One, banks buy into each other's investments. Two, they leverage to the hilt to maximize their investments. Before the introduction of the Federal Reserve, there were no rules. All their profit is basically from debt. The more loans that can be serviced along with government notes, the three o'clock country club cocktail life is a sure thing. Until more and more people seek that style of life by any means. Enter fraud. Word gets out. Bank run. Bank collapses. Enter recession.

Enter J.P. Morgan

He realized that leverage is a weak link. If there was a "special bank" like they had in Europe, it could provide capital to cover a crisis. This would stop a run. He pushed the idea. He got a Rhode Island senator on board by having the daughter marry a Rockefeller. He got a weak president (Wilson) to sign the bill which created the Federal Reserve. This was the first nail in the coffin for our currency and gold. Clouds began blocking the sun.

Enter FDR

The new president realized that he needed to get people back to work in order to get the economy going again as the Depression was on hand. His first act was to ban gold. He knew deficit spending would be needed and gold kept the government in check. Gold died on that day. The sun no longer shined in America. Since then, our dollar has lost 95% of its value. This is inflation and what it does to our standard of living. It has declined. We were number one until deficit spending became a way of life. Today, the liability column exceeds $50 trillion. Dear Reader, the US is no longer number one in the world. We are number 22 in reality. 

How can that be and why, you ask? 

Because we are innovative. Because we have a strong military. Because intrinsically, we offer what no one else offers. An immigrant to America can become a citizen. This is not the case everywhere else, although some of the obstacles to citizenship are changing. However, the rich keep plotting. They fought unions by outsourcing. The wealth gap began. By controlling the media, citizens are misled for the cause of problems in our economy, our standard of living, in America.

The cabal started by JP Morgan controls our currency. The military got on-board because most of the deficit spending went to them. The world trades in US Dollars, however this is being challenged. 

Outlook

We have nations seeking to break the control of the dollar being the world's reserve currency. We have record deficits with even more "off the book" liabilities. We have the reckless danger of world war, and we know one thing, gold will retain its value. We told you in previous pieces that gold will rise. Last week, it went past the $2000 level. If you look at a daily chart for the last month, it reveals a cup and handle chart formation. This is very bullish. We see it rising to $2129. We get a second support from both the XAU and HUI gold indexes which also showed a cup and handle pattern on the weekly chart. When gold tests this projected level, we will reevaluate. Keep in mind, in 2022 as the Federal Reserve began raising interest rates, the word against gold was it did not pay a dividend and higher rates would cap any advancement in price. Folks, many growth stocks do not or did not offer a dividend, but they advanced in price. Gold fights the Fed and they know it. They are Fiat. They are fake money. No matter what they do with interest rates today, gold is the real thing. It is why we are for gold. 

- Little darlin', it's been a long, cold, winter                                                                                                    Little darlin', it feels like years since it's been here                                                                                        here comes the sun, doo-doo-doo-doo                                                                                                            here comes the sun, and I say, it's alright.

Thank you, George Harrison. Miss you. RIP...Peace.  

Odds and Ends: October 2023

In last month's piece on odds and ends, we opened with distress. We included a report from the US military that stated, "...war with China is coming by 2027." We also talked about the market and the false propaganda coming out of China about the islands off their coast. One month later, we find ourselves thinking about the expression, "A New York Minute." It means things are going along in a normal manner and suddenly, something dramatic happens.

Middle East

It became the New York Minute. We stated our concerns last week. No need to repeat except this point. We stated that the status quo loves this conflict. It gives them an opening to repeat all their negative claims to continue military spending, to continue debt spending and this is money in their pocket.

Meanwhile...

The average citizen suffers from inflation and stress about their job, their future. Consumers are tapping credit to make ends meet. Total credit card debt is over $one trillion. People looking to purchase a home or sell their home and seek their retirement location face 8% mortgages on expensive housing.

Repo-Man

We found a report that says car owners are falling behind in their payments at a new record level. Then, the media declares the consumer, "resilient." We know why. The status quo controls the media. We are glad that Google offers us this freedom of expression in this blog space. We turn to the market...

Rapid Price Swings...

...indicate a change in perception. This will direct the future outlook since the market likes to peer out six months in advance. We noticed two important trendline rapid price swings with changing direction.

King $Dollar

It has broken its upline channel for a higher price. It can either consolidate or fall. Keep your eye on it.

Gold

It has tested its lows. It also broke its downtrend. It needs to break $2009. Keep your eye on it.

Oil

We told you in our last discussion on the commodity that it needs to pierce $93. It tested that figure, but it could not hold price. We feel another test is coming due to two factors. One, it ran out of energy rising to that price from the low consolation level ($83). Secondly, it had high volume at the peak price ($95).

Last Thought

Do not believe the hype about November being a top month to get into stocks. Buy some time with short-term CDs or bonds. Things can change in a New York Minute.  Peace.