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#141 romans holiday

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Posted 23 February 2010 - 10:44 AM

Ian Gordon: Ignore the Illusion of Spring

http://news.goldseek.../1266874951.php
QUOTE
IG: I am very much a deflationist. Taking the debt out of the system is in itself a deflation process. You can see it in falling housing prices. As debt comes out of the housing and mortgage markets, it deflates prices. We're going to see the same in stock prices. Wealth is being reduced considerably, and that is deflationary.

A lot of people who argue for inflation say that all the money being printed eventually has to go through the banks back into the economy. But it's like being on a treadmill. You running as fast as the treadmill goes, but you don't get anywhere. The Federal Reserve is printing copious amounts of money trying to re-start the economy. Unfortunately, the rate of debt being taken out of the system eventually will overwhelm their ability to do that.

TGR: Your Winter Warnings indicates that as we move through this collapse, China will become a scapegoat in terms of other governments implementing policies that will harm Chinese exports. If the Chinese GDP is growing and they're already becoming less reliant on exports, could they have a milder Winter than Europe and the U.S.?

IG: I think perhaps the Chinese Winter will be the worst of all, and again we have a parallel. China is the U.S. of the '20s. The U.S. came out of World War I as the world's largest creditor nation, with a major significant growth in its industrial prowess—all of which China is today. At that time, the U.S. government was paying down debt, and it wasn't that significant anyway. And now, the Chinese government doesn't have much debt; either. But in the U.S., corporations and consumers of the "Roaring '20s" built up huge amounts of debt. You see parallels in the housing market in the '20s to what we see today in China. A lot of suburbs were developed because people had automobile or railway access to the suburbs. At the same time, we had a major development of skyscrapers in city centers, monstrous buildings carrying monstrous debt.

China is in that kind of process. What happens when you get so wealthy, you're exporting so much, particularly to the United States, the Chinese government takes the U.S. dollars and credits the bank with renminbi. The bank has all this money on hand. So a local businessman goes to the bank and says, "I want to build a factory and build toys for Toys 'R' Us in the United States." The banker says, "Fine." He has all this money; he makes the loan; the borrower goes and builds his factory. Somewhere across town, someone else goes to another bank and does the same, and again and again with different borrowers and lenders. It's the mal-investment that occurs when you have so much money floating in the system.

TGR: And then what?

IG: Eventually, the United States, the biggest importer of Chinese products, cannot continue buying at that level. Despite the pace of growth in China's economy, it still takes probably at least 50 years, maybe more, to develop a middle class. Those are the people who have the wherewithal to spend. So, it's going to take China a long, long time; it's still very much an agrarian economy.

For these reasons, I think China's banking system will go the way the U.S. banking system did in the '30s, and the whole economy will go into a collapse. But out of it, she will rise as did the U.S. as the greatest economic, financial and political power. She will be the world leader.
...
TGR: So, it's a combination of owning gold and gold stocks. Or should we say precious metals—we'll expand it out to silver. Should our portfolios consider other elements?

IG: As for silver, it didn't really work as a monetary instrument in the early 1930s. Although at that time U.S. coinage from the dollar to the dime was minted in silver, so there was certainly hoarding of silver coinage during the last depression. During this depression silver may well take on a monetary role, since the price of gold might take that metal out of reach of many people. I think only the precious metals work—again because of the stock market debacle that I see occurring. We know that investing in precious metals worked in the '30s. People were pushing their money into gold stocks because they wanted to be in gold in any shape or form.

TGR: Because you're suggesting that all gold companies will increase in value during this timeframe, should the average investor be concerned about which specific gold companies to invest in?

IG: Certainly the producing companies will go up with the rising price of gold. Don't forget in the early '30s the gold price was fixed at $20.67 and it wasn't raised to $35 until 1934. But even so, people were investing in the gold companies, both explorers and big producers.

Today, I tend to put my money into the juniors because that's where I see the leverage to a rising gold price. But you've got to be very, very selective and very cautious. You have to evaluate management of these companies. In Canada, particularly in Vancouver where most of the junior precious metals companies are situated, we're living with these people. It's very tough in the United States, where you have to rely much more on what others tell you. Fortunately, a lot of very reputable newsletter writers and so on are trying to do a good job in their recommendations.

Modern money "shorts" the currency, and is backed by debt. The debt is real. A debt deflation will lead to a prolonged period of deleveraging, where the short-covering of currencies will strengthen currencies relative to asset prices. At the global level, in the FX market, central currencies will benefit from deleveraging at the expense of peripheral currencies. Due to instability and uncertainty, gold will benefit against all currencies as it continues to be re-monetized.

Hold on to your hats for hyper-deflation, where cash is king, and gold the King of cash.
[Silver? A Volatile Queen].

#142 Jake

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Posted 23 February 2010 - 01:14 PM

Great article as ever from IG. Funnily enough I was staring at the 'wheel within a wheel' chart thinking that just about all the conditions for 'spring' in the Kondratieff cycle are looking to be met. 'Have we blinked through winter', I wondered, 'is this a 'false' spring in some way. Come home and here is this article, so thanks for posting.

'TGR: Will this Winter end in 2012 then?

IG: No, it's just the bear market bottom. Remember the bear market bottomed in 1932. But the Great Depression didn't really end until World War II. The Winter continued even though the bear market had bottomed.'


So some fun in store for us lot. Chuck in possibility of Kunstlerian peak oil and the years 2012 to 2025/30 sound like a load of laughs. Never mind I am going to have some scottish single malt now and quit thinking till tomorow. Its been a long day.


BTW here is the 'wheel'.

http://www.longwaveg..._Wave_Cycle.pdf
"We are reaping what has been sown over the last three decades of creating a grotesquely unequal society with an ethos of grab as much as you can by any means. A society of looters created by MPs and their expenses, bankers and their bonuses, tax-evading corporations, hacking journalists, bribe-taking police officers, and now a group of alienated kids are seizing their chance. This is not to condone but to understand." - John McDonnell MP


"Things got a bit out of hand & we'd had a few drinks. We smashed the place up and Boris set fire to the toilets."
David Cameron, 7th June 1986.

#143 GTG

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Posted 23 May 2010 - 08:04 PM

My preferred count on the S&P500:



If it's correct we could see sideways action posssibly in a range of 1088-1051 carving out a triangle over the next few days, a close above 1117.50 would invalidate this count but the bear count would still be in place unless a close above 1178.75. Next resistance level is 1099.25 which conicides with the 50% fib RT of wave iii. Target for the end of wave v would be around 1028-1038 based on it being equal in size to wave i and a maximum RT of wave iii to the 50% RT level.
The entire modern financial system is based upon a very small group of people having the power to create money out of thin air.

#144 GTG

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Posted 24 May 2010 - 05:28 PM

Wave iii correction may be over -




Anyone know why I've been receiving an "authorisation mismatch" error message when I try to post?
The entire modern financial system is based upon a very small group of people having the power to create money out of thin air.

#145 GTG

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Posted 26 May 2010 - 02:40 PM

I've counted this an impulsive move because of the acceleration of wave iii. Target for a turn is 1092 although it's possible that wave v is done here. If so a more complex corrective structure should play out.

If 1092 is breached we will most likely have zigzag with turn targets of 1099 and 1117, in which case it is possible that the down trend could resume at these points.




The entire modern financial system is based upon a very small group of people having the power to create money out of thin air.

#146 GTG

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Posted 27 May 2010 - 02:10 AM

Diped a toe in on the short side, wave (2) may have completed.



A zig zag or less likely a triangel is a possibility, in the case of a zig zag turning point around 1102.


The entire modern financial system is based upon a very small group of people having the power to create money out of thin air.

#147 GTG

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Posted 27 May 2010 - 02:40 PM

Zigzag based on C being 61.8% of A (1:1= 1108)maybe complete, negative divergence on the RSI possible resumption of downtrend.

The entire modern financial system is based upon a very small group of people having the power to create money out of thin air.

#148 GTG

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Posted 28 May 2010 - 03:25 PM

Zigzag played out to the 1:1 ratio to within 1.5 points - wave c with and extended fifth - AB=CD pattern. Negative divergence on the RSI in place. Let's see if it's straight down from here or a more complex correction. The personality of wave 2 favours the correction is over. Whatever, the chances are, is that the high is in place if it is only a correction. Hence I'm short 2/3 of a full postion, keeping some powder dry for the unexpected.


The entire modern financial system is based upon a very small group of people having the power to create money out of thin air.

#149 GTG

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Posted 13 June 2010 - 05:08 PM

The correction has turned out to be more complex. I think we are now in a five wave impulsive move to complete wave c of a flat correction back to resistance at the 50% fib retracement of the preceding 5 wave impulse down i.e. 1106 on the E minis. It's very possible that the terminus of c could hit the 61.8 retracement at 1122 if shorts are forced to cover on a move above 1106.

To add to the bearish case the trend has been strongest on the downside moves since the peak in the index. By the end of Tuesday 15th June the correction would have taken 1.618 of the preceding move down time wise. Although time in EWP are not as significant as price movement ratios it may well give an indication as to when a turn may occur. A break of 1174 would invalidate my count.


The entire modern financial system is based upon a very small group of people having the power to create money out of thin air.

#150 DrBubb

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Posted 20 June 2010 - 03:09 AM

Free Week !
/ Click here:
http://www.elliottwa...ources-FreeWeek

Elliott Wave Forecast - US Markets 14th June 2010


Robert Prechter & the Severe Bear Market - RickSantelli.tv

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#151 Catflap

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Posted 20 June 2010 - 10:38 PM

Oops.... wink.gif

Guru Accuracy Rating 26% - this is below average


#152 DrBubb

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Posted 20 June 2010 - 11:06 PM

QUOTE (Catflap @ Jun 21 2010, 06:38 AM) <{POST_SNAPBACK}>

From there:

From Mark Hulbert in MarketWatch (11/25/09): “…Prechter’s advice over the last couple of years has been top-rated. …On the other hand, …the newsletter’s timing advice for traders is in last place for performance over the last 20 years among all stock market timing strategies tracked by the Hulbert Financial Digest.”

Listen to his thinking, but dont be a slave to his timing ideas
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#153 Catflap

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Posted 20 June 2010 - 11:39 PM

QUOTE (DrBubb @ Jun 21 2010, 12:06 AM) <{POST_SNAPBACK}>
Listen to his thinking, but dont be a slave to his timing ideas


I agree with a lot of his thinking and do now try and listen to him when stock markets are getting ahead of themselves and have advanced for 8 to 10 weeks.

Eg. (not that I watch this muppet show - just Googled)

http://www.cnbc.com/...63714869&play=1

You don't want to be like these guys - too bullish after a big advance and too arrogant to listen to what Robert Prechter was saying. I give him credit for seeing this top and wish I had seen the video at the time as I would have raised more cash - I am now making a point to see what he is saying when things get too bullish again.

#154 GTG

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Posted 29 June 2010 - 07:33 PM



Bear flag break out, took profits on half my short position at the old lows in case this is just a corrective "x" wave.

EDIT: i and ii just around the break out should be in parenthesis to show a waves of a higher degree.
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#155 GTG

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Posted 01 July 2010 - 07:10 PM

Well, I'm sticking to my count as I'm seeing black figures in my accounts. In true elliottwave fashion I'm trying to shut out the news and letting the waves, sentiment and confirming technicals direct me in my trading.



I added to my position today and I'm staying short on the basis that we are now in a third wave down just having completed the first of a third. I expect there to be a shallow retracement possibly testing the break out area around 1038 in the e minis and have my stops placed above the highs at iv around 1045. If my count is correct then tomorrow possibly Monday I expect to see an explosive move down. We've got non farm payrolls tomorrow so that should stir the markets if there's a significant divergence from the forecast, I suspect there will be.
The entire modern financial system is based upon a very small group of people having the power to create money out of thin air.

#156 DrBubb

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Posted 05 July 2010 - 02:41 PM

A Market Forecast That Says ‘Take Cover’

By JEFF SOMMER / July 2, 2010 / NY Times

WITH the stock market lurching again, plenty of investors are nervous, and some are downright bearish. Then there’s Robert Prechter, the market forecaster and social theorist, who is in another league entirely.

If Robert Prechter is right, one market analyst said, “we’ve basically got to go to the mountains with a gun and some soup cans.”
Mr. Prechter is convinced that we have entered a market decline of staggering proportions — perhaps the biggest of the last 300 years.
. . .
His advice: individual investors should move completely out of the market and hold cash and cash equivalents, like Treasury bills, for years to come. (For traders with a fair amount of skill and willingness to embrace risk, he suggests other alternatives, like shorting the market or making bets on volatility.) But ultimately, “the decline will lead to one of the best investment opportunities ever,” he said.

Buy-and-hold stock investors will be devastated in a crash much worse than the declines of 2008 and early 2009 or the worst years of the Great Depression or the Panic of 1873, he predicted.

For a rough parallel, he said, go all the way back to England and the collapse of the South Sea Bubble in 1720, a crash that deterred people “from buying stocks for 100 years,” he said. This time, he said, “If I’m right, it will be such a shock that people will be telling their grandkids many years from now, ‘Don’t touch stocks.’ ”

The Dow, which now stands at 9,686.48, is likely to fall well below 1,000 over perhaps five or six years as a grand market cycle comes to an end, he said


/more: http://www.nytimes.c...amp;ref=general
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#157 confounded

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Posted 05 July 2010 - 06:52 PM




#158 DrBubb

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Posted 05 July 2010 - 10:45 PM

Thnx, C. That fits with the following:
QUOTE (DrBubb @ Jul 4 2010, 09:39 PM) <{POST_SNAPBACK}>
Some great help by Confounded on HPC !

Thanks for all that hard work, Confounded!



Let me summarise in my own way, adding some nearby dates:

0 / ???? (1348) : The Black Death, 1348-50 kills 1/3 of Europe's population
1 / 1495 (1492) : 1492-Columbus discovers America (and "new markets" for Europe)
2 / 1688 (1694) : Glorious Revolution begins- William & Mary / BofE establised-1694
3 / 1744 (1749) : British fleet defeated by Fr.&Sp. at Toulon; High infl., Mass. 1745-49
4 / 1800 (1800) : Act of Union, creating UK; Prices jump 36% in 1800, highest on record*
5 / 1866 (1865) : US Civil War ends 1865; reopening American market,1866
6 / 1915 (1918) : World War I / WW1 Ends 1918, reigniting World trade

*(note: the chart shows "real prices", so earnings were discounted at inflation rates)

THE BIG UPWARDS THRUST since 1800, was basically the "Industrial Revolution",
and the usage of various forms of energy to increase living standards and real earnings.

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#159 wottwotril

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Posted 05 July 2010 - 11:27 PM

Good thread.

Again, as a refresher...

http://www.marketora...rt-image005.png

With the adjusted 80 year K wave we could be on the cusp of the mother of all crashes..

#160 DrBubb

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Posted 05 July 2010 - 11:31 PM

lines added

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix




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