Deflation of a Mania

The enormous rise in prices which ended in year 2000 was a Mania, a Stocks Mania. The first move down after the end of the Stocks Mania marked the beginning of a new major trend, a downtrend this time, which has many months – perhaps extending into years - yet to run. That first move down ended with the 2002 lows. The subsequent high which ended in October 2007 was the first bounce in the...

Buy, Sell or Hold Insight: GM Remains a High Risk Profit Play – Even as it Files its Turnaround Plan Today

With America’s “Big Three” automakers all due to submit turnaround plans to Congress today (Tuesday) – a requirement if General Motor Corp. (GM), Ford Motor Co. (F), and Chrysler Corp., are to receive $25 billion in government loans – I couldn’t help but recall the moment eight years ago when I realized the U.S. auto industry was skidding toward a financial c...

Fixing the Monetary Unfixable

Dec. 1 (Bloomberg) — Treasuries rose, pushing yields to record lows, as Federal Reserve Chairman Ben S. Bernanke said the central bank may purchase Treasuries and target long-term interest rates to combat the deepening recession. …and the monetizing of debt begins. I’ve talked extensively in several issues of Bourbon and Bayonets about the coming turmoil in long dates U.S. tre...

Don’t Give Up on Gold

If you were counting on gold to boost your returns this year, chances are you’ve been cruelly disappointed. In fact, when it comes to gold-related investments, virtually every category is down, making this one of the worst years in history for gold investors. So, why is it that the largest of the large futures traders have some of the lowest net short positions in years? And what does thi...

California in crisis

The ongoing saga of the people who refuse to live within their means. Federal Bailout on the way? Yahoo: Gov. Arnold Schwarzenegger declared a fiscal emergency Monday and called lawmakers into a special session to address California’s $11.2 billion deficit. The state’s revenue gap is expected to hit $28 billion over the next 19 months without bold action. The emergency declaration a...

A Slippery Slope Ahead for Oil

Dr. James Schlesinger says the U.S. attitude towards oil “has only two modes – complacency and panic.” Schlesinger should know. In the 70’s he closely watched the Middle East as the U.S. Secretary of Defense. Then he would move onto become the first U.S. Secretary of Energy when oil prices were really starting to move up during the Carter Administration. He was in the th...

November Unemployment Statistics to Highlight Economic Reports This Week

This week’s economic reports will be highlighted by Friday’s unemployment report, which analysts expect will illustrate the 11th straight month of declining job ranks in the U.S. economy. Non-farm payroll employment fell by 240,000 in October, and the unemployment rate jumped to 6.5%, up from 6.1% the month before, the Bureau of Labor Statistics reported in early November. October&r...

WALL STREET THANKSGIVING

As Americans this week sat down to their traditional Thanksgiving dinner, the real feast was once again being enjoyed by the Wall Street elite. Citigroup received a heaping helping of government aid from the world’s two most famous turkeys – Bailout Ben Bernanke and Handout Hank Paulson. The US government is now guaranteeing over $300 billion worth of Citi’s loans. It is obvio...

EQUITIES LOOKING AT A NEGATIVE SESSION AS TRADERS SCALE BACK RISK AHEAD OF RATE CUTS

The Dollar and yen hold their stature as safe haven currencies, as investors brace themselves for a selloff in the US trading session. The EurUsd fell 85 pips to the low range of 1.26, while the UsdJpy dropped 140pips finding support near 94. The GbpUsd collapsed 400pips pushing the pair through 1.50 currently trading with a 1.49 handle. Equities in the US declined with the Dow down 360pts or 4...

Stocks fall sharply on consumer spending worries

By SARA LEPRO AP Business Writer (AP:NEW YORK) Investors uneasy about the holiday shopping season gave Monday back some of Wall Street’s recent gains, sending the Dow Jones industrial average down more than 360 points. While initial reports about the start of holiday shopping this weekend suggested sales were better than some retailers and analysts expected, Americans are clearly extremel...