Three Blind Mice

Or, The Blind Leading The Blind.

AP

Bush Confident of Market Recovery

Wednesday August 8, 8:16 pm ET By Jeannine Aversa, AP Economics Writer

President Bush Believes Stock Market Will Make a 'Soft Landing' From Recent Turbulence

WASHINGTON (AP) -- President Bush struck a reassuring tone Wednesday about recent turbulence on Wall Street, saying he believes the markets will work their way through the turmoil safely and achieve a "soft landing."

Bush, in his most extensive remarks on a gyrating stock market that has sent investors on a rollercoaster ride, expressed confidence that investors would eventually calm down. The president said he expects investors to reassess their risk and begin to focus more on the economy's fundamentals, which he said are solid and sound.

It's 5pm est. DOW -387, NASDAQ -56, S&P -44. A casual observer would have to conclude, Mr. President, that a market sear you are not. The economy's "fundamentals" are solid and sound? They're flimsy at best, and as solid as a handful of sand. The stock market has about as much chance as an egg hitting the floor of having a "soft landing". The President has spoken people...believe his lies at your own risk.

They all lie. Bernanke...he's the biggest liar of the lot. He continues to talk out of both sides of his mouth:

"...the economy seems likely to continue to expand at a moderate pace over coming quarters, supported by solid growth in employment and incomes and a robust global economy."

"Although the downside risks to growth have increased somewhat, the Committee's predominant policy concern remains the risk that inflation will fail to moderate as expected."

This from the text of the Fed Statement on Tuesday (you can read it here:http://biz.yahoo.com/ap/070807/fed_text.html?.v=1 ) There's a sucker born every minute, but this blah-blah is obvious hogwash. How can the economy grow, if growth risks have increased Ben? How damn it, how?

The risk that inflation will fail to moderate? Ben, you and your cronies continual printing of US Dollars out of thin air is what's causing inflation. How can it moderate if you're growing the money supply by 13% a month? Ben! Inflation has failed to, and will continue to fail to moderate. Ben, your credibility is shot...you and the Exchange Stabilization Fund have lost control of the markets you have attempted to manipulate since 9/11. The jig is up. Gold, the Truthsayer, is knocking on your door. And Gold is going to huff and puff and blow your house of cards down. Gold is going to expose your lies, Hank Paulson's lies, and George Bush's lies. The US Economy is on the brink of total collapse, and the Three Blind Mice just go on their merry way...whistling past the graveyard.

The lemmings ran away from their Gold and Silver investments today to avoid risk...fools the lot of 'em. The savvy investor once again swooped in to buy a little "wealth protection" at sale prices. Buyers lined up at Gold's 50 day moving average, and said "thank you very much" to those that parted company with their Precious Metals that are too risky to own. Silver got whacked, just because the paper pushing Vermin of the COMEX could whack it. There are shorts in Silver absolutely desperate to get out at a price. These dips are buying opportunities. They are noise in a market to those that comprehend The Big Picture. The fundamentals for owning Gold and Silver were only strengthened once again by today's news that a French Bank suspended three hedge funds with ties to the US subprime neutron bomb.

For a closer look at where we stand at this hour, please click on the charts above.

Recession On The Horizon?

My cable modem bit the dust last evening and closed my little window on the World. I could scream all I wanted to, but the cable store wouldn't be open until 9AM this morning. And now for more in the continuing saga of the Dissipating Economy of the USA...

Amusing to say the least. The Dow falls 260 points on Friday and rises 280 on Monday. Pathetic. Oil comes tumbling down on Monday on "speculation" that a weakening economy will weaken demand for Oil. I hate to point this out, but the rest of the world uses Oil too. And the demand for it across the globe is unlikely to shrink much in sympathy to the poor and despondent USA. The World Economy revolves less around the USA as each day passes. And besides, if the economy was going to get so weak, why was the Dow up 280 points? Clown in Colorado predicts one less hurricane in 2007. Yeah guess it's okay to sell all my Oil contracts and go whistling past the graveyard.

The destitute US Dollar takes another peak at the cliff below 80 on the USD Index. Crawls back from the ledge and looks over it's shoulder.

The 10-year Treasury Note, suddenly a "safe-haven" for those seeking safety from the chaos and carnage in the stock indexes is about to start taking on water very soon. The price of the10-year note has reached the downtrend line established off it's Spring 2005 high. Resistance there at the downtrend line and at the 38% retracement of that same high combined with resistance at the old, and broken, uptrendline off the July 2006 low spell SHORT OPPORTUNITY. OR outright sell call for the 10-year note.

Recession is not far off. And with recession, those fleeing stocks AND Treasuries will begin flocking to Gold and Silver in ever increasing numbers as growing investment demand drives gold higher in this "second phase" of Gold's secular Bull Run.

The Fed is about to speak. A hush falls across the boob tubes talking heads... Oh my, from green to red in a hurry.. Tune in tomorrow.

The Day The Music Died

The Federal Reserve has lost control of the financial markets...

In the game of musical chairs, when the music stops, if you don't find a chair before all the others do...you're out of the game. How many hedge funds are about to be caught without a seat as the music dies, and booted from the game? Not enough...

Friday August 3, 2007 my be looked back upon in history as the "Day The Music Died" for the US Dollar, the Dow, the US Economy, and hedge funds across the globe. Many will ask, "Who kicked the jukebox?" And the answer will be in chours, "Sam Molinaro, CFO of Bear Stearns."

Poor Sam. Forever labeled a traitor for simply uttering the truth. "The turmoil in the credit market is the worst I've seen in 22 years," said Sam Molinaro, CFO of Bear Stearns on Friday. Sam opened the door and shined a light on the all the cockroaches of the credit industry. The Big Lie, Dow 14,000, is now forced to deal with the truth.

It’s the Fundamentals Stupid By: Peter Schiff, Euro Pacific Capital, Inc.

Amid the recent stock market weakness, the pundits are virtually unanimous in their claims that good underlying economic fundamentals are being trumped by irrational fear. However, if investors understood just how bad the fundamentals for the U.S. economy really are, they would dump stocks even faster. So, contrary to the rhetoric, it is not that investors are being too fearful, but that they are being too complacent.

During the recent stock market rally investors ignored some very disturbing underlying economic fundamentals. Therefore, the current weakness in the market is not in conflict with the fundamentals, but completely consistent with them. Unfortunately for the overall economy, the re-assertion of fundamentals is not exclusive to the stock market. Here is a look at what will likely happen to other asset classes and our economy should investors refuse to blindly follow the Pied Pipers of Wall Street:

http://news.goldseek.com/EuroCapital/1186166376.php

Down We Go Again

http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=2E9A048E-17A4-1130-F5F933343AEDFD7C

A good does of the truth in this report.

Crude prices fall on revised hurricane forecast

Crude oil prices declined on Friday as investors decided to take profits and as Colorado State University weather forecasters cut the number of hurricanes they expect in the Atlantic this year from nine down to eight overall, and reduced from five to four the number of major hurricanes they believe will form.

http://www.oilmarketer.co.uk/2007/08/03/crude-prices-fall-on-revised-hurricane-forecast/

This is just one more example of how clueless and stoopid Oil Traders are. I told you weeks ago Oil could see 77.10 by Labor. We just hit 78.40 and it's ONLY August 5th. I live in Wilmington, North Carolina. Bulls eye for Hurricane Alley. Trust me, nobody around here is letting their guard down because some quack in land locked Colorado of all places is predicting there will be ONE less hurricane this year than he thought. LOOOOOOOOL, how absurd. Hurricane season is really just starting to gel...they're out there, lurking. Only a fool believes otherwise. Besides, it ONLY takes ONE hurricane to devastate the Oil refining industry of the gulf coast. Just One!

Nothing in the supply/demand fundamentals of Oil has changed because of this "news", has it?

Hiring Cools in July; Jobless Rate Up

WASHINGTON (AP) -- The nation's unemployment rate inched up to a six-month high of 4.6 percent in July as hiring simmered down. Workers' wages, meanwhile, grew modestly. Wall Street tumbled.

The latest snapshot of conditions around the country, released by the Labor Department Friday, showed that new job creation has slowed. Employers increased payrolls by 92,000 last month, down from 126,000 in June. It marked the fewest add-ons in a month since February.

"Although slightly lower than the previous month ... we still think of these as good, solid numbers," said Edward Lazear, chairman of the White House Council of Economic Advisers. The labor market, he said, has been a "shining beacon" even as the economy has made its way through a sluggish spell over the past year.

http://biz.yahoo.com/ap/070803/economy.html?.v=25

If this clown offers to share his drugs with you, please decline...this goof has lost his mind. With Economic Advisers this out of touch, we as a nation are certainly doomed. Only the Truthsayer, Gold, can save you now. "Save yourself! Buy Gold Now!"

From Bob Chapman, The International Forecaster

They simply couldn’t hold back the flood. The Dow fell 281 to 13,182 wiping out two days of contrived gains created by the Fed and the “Working Group on Financial Markets.” Using our formulas the S&P FELL 355 and the Nasdaq fell 388 Dow points. In the last hour it was a massacre.

Gold responded by rising $8.10 to $672.70 and silver jumped $0.14 to $13.09 to make Friday a great day. The pros have finally realized that the elitists’ attempts to control all markets is not working well anymore and that the Fed had not only been lying about inflation but they had no intention of trying to correct it.

http://news.goldseek.com/InternationalForecaster/1186326120.php

We got what we wanted and asked for Friday morning. Gold not only moved thru 668, but 672 as well. Silver bulls have regained control of the metals 50 day moving average. Things are definitely beginning to look up for the precious metals now. The Dollar was crushed Friday and was DOWN 48 pips to close at 80.19. Should the Fed foolishly come to their hedge fund and banking buddies rescue with a rate cut on Tuesday, the Dollar will implode and Gold will be on it's way to the Moon.

Gold has been trading in a Rectangle pattern now since January 22, 2007. Bounded on the low side by Gold 640 and on the high side by Gold 690.

As defined at stockcharts.com

http://stockcharts.com/school/doku.phpid=chart_school:chart_analysis:chart_patterns:rectangle

Rectangles represent a trading range that pits the bulls against the bears. As the price nears support, buyers step in and push the price higher. As the price nears resistance, bears take over and force the price lower. Nimble traders sometimes play these bounces by buying near support and selling near resistance. One group (bulls or bears) will exhaust itself and a winner will emerge when there is a breakout. Again, it is important to remember that rectangles have a neutral bias. Even though clues can sometimes be gleaned from volume patterns, the actual price action depicts a market in conflict. Only until the price breaks above resistance or below support will it be clear which group has won the battle.

A breakout to the upside from this Rectangle at 690 projects to Gold 740. This is certainly realistic as the clouds over Wall Street darken. Couple this Gold projection with Silver's potential Reverse Head & Shoulders bottom and projected upside from a breakout there to 14.70 and the next several weeks in precious metals have the potential to enrich the faithful.

Under The Radar

Gold Provided The Only Glitter For Sectors In July
Aug. 2, 2007 (Investor's Business Daily delivered by Newstex) --

It looked simple. Stocks and stock funds were down. So gold funds rose in July.

They gained 3.73% on average, according to Lipper. It was the group's first month in the top spot since November.

In a bruising month for the overall market, it was the only sector to gain ground.

http://money.cnn.com/news/newsfeeds/articles/newstex/IBD-0001-18632665.htm
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Gold gains as outlook looks positive

Gold held by StreetTRACKS gold ETF surged more than 10 tonnes to a record high of 506,69 tonnes today from a day earlier, data showed.

Japan’s first exchange-traded fund tracking a gold price index was launched with initial assets of ¥5,096bn today.

http://www.businessday.co.za/articles/markets.aspx?ID=BD4A530922
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'Remarkable' speedup in gold miners' dehedging

LONDON -- Gold miners accelerated their de-hedging programs during the second quarter, drawing down hedges by another 5.4 million troy ounces to 31.2 million ounces, metals consultancy Virtual Metals said Thursday in a joint report with Mitsui & Co. Precious Metals.
This cut, a record 15% decline, was the 21st successive quarterly reduction, and means gold hedging worldwide is now 70% lower than its peak in the third quarter, 2001.

http://gata.org/node/5312

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Why the gold market is an investor's best friend

They say diamonds are a girl's best friend. For investors right now, I'd change that to the gold market.
Let me kick off with a couple of juicy statistics…

• Industrial demand for this popular metal hit a record 458 tons in 2006.

• Investment demand soared 45%

• Gold supplies fell almost 15% in 2006.

The Lear report says producers in countries like South Africa are simply unable to keep up with the sizzling demand from Asia and the Middle East. The jewelry industry is a mega global business in both regions, with sales hitting $44 billion last year.

It's not often you hear the phrase "a gold supply shortage." But that's changing now. Having socked away vast gold reserves for decades to diversify their holdings, the world's central banks are now changing their tune.

Their collective gold stash is dwindling rapidly, causing them to have less control over the gold market. As a result, private investors are jumping in with a vengeance, confident that less central bank control over buying and selling means less price volatility.

In fact, private investors have gobbled up 7,500 ounces of gold over the past five years - and now control more of the supply than central banks, according to CPM Group. That's huge!

http://www.moneyweek.com/file/33065/why-the-gold-market-is-an-investors-best-friend.html

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Clearly, demand for Gold is rising. And "investor" demand is apparently leading the pack. Investment demand is what will ultimately lead Gold to and through $1000. Investment demand will overwhelm any and all central bank shenanigans and absolutely crush the Vermin of the Comex. Too find headlines and stories like these you have to dig. The general media would rather have you believe that Gold is an asset of Risk. Why has Gold been labeled a risk by the media anyways? Because most of the buffoons writing in the financial press have little, if any, real understanding of Gold. Too many believe Gold to be a commodity. Gold is a metal. Copper, nickel, and zinc are metals too. They may all be metals, but is the fools choice to lump Gold in with all metals and consider it "just another commodity". Gold is honest money. Gold is a store of wealth. Gold is the Truthsayer. Gold rides through the streets by day and by night with just one clear message: "Save yourself. Buy Gold Now!"

Gold and Silver had a relatively quiet day today. Our near term goals remain the same: Gold Bulls must regain the ground above 668, and Silver Bulls must regain positive control of its 50 day moving average. As an ominous sign for Silver Bears, the Reverse Head & Shoulders Bottom developing on the Silver chart should have all dem Rat Bastids on HIGH ALERT. The neckline is falling as we mover forward in time. And that means the price [now at 13.34] at which Silver breaks higher falls by the day. A break above the neckline could catapult Silver towards 15 and severely singe the hides of the paper pushing Vermin of the Comex. I will post a chart of the Silver Bulls WMD daily until this pattern is resolved.

More Monkey Business

But what if The Fed cut interest rates next week? That would certainly be a shock to the system. And man Gold would catapult as the Dollar sank like a stone in the ocean. Somebody pinch me...

The Stock Markets here in the good 'ol floundering U.S. of A. are the ONLY thing attracting foreign held funds into the country. Me thinks the Fed would sacrifice the Dollar to further prop up the stock markets here...it'd be cheaper than printing money. Well..., maybe.

The rising cost of Oil is savaging the Dollar. And this price rise in Oil could be the straw that breaks the donkey's back.

The dollar and oil tend to move in opposite directions. This is partly to be expected if the price of oil is in US dollars. If dollars depreciate then commodities priced in dollars will tend to rise. However, that doesn’t begin to explain it all. The dollar has dropped 33% in value since 2002 but oil has not increased by 33%, but rather has almost quadrupled in price as oil gets more expensive to extract and China leads explosive Asian demand.

-Roland Watson http://www.kitco.com/ind/watson/aug012007.html

Please read Roland's entire essay to get the real picture of Oil's influence on the Dollar's demise.

Jim Willie CB, GoldenJackass.com has another scathing essay up for your entertainment this week. Fed Funds & Other Signals, you can read it here: http://news.goldseek.com/GoldenJackass/1185998400.php

A quick review of signals surely can be both encouraging and confusing. They point to higher physical prices, calmer stock prices, and a continued housing crisis & mortgage debacle. The big banks and Wall Street broker dealers are breaking down very badly. The USDollar bounce is already running out of steam, hampered by a restored expected interest rate cut. Remember: whatever is vigorously and repeatedly denied is almost surely to occur!!! Deception sells products.

Today in Gold and Silver. More laughter really as more fools run from the metals across the globe seeking safety in the US Dollar and an aversion to risk. Yeah, well, whatever...fools. And look, the metals were higher in the after hours market? Oh, and look at this...a late afternoon rally in stocks. Coincidence? And the air leaked out of the Dollar after the sun came up today. What a crazy world we live in. Predictions right now are useless...a lesson learned long ago: "When your unsure of what to do in the market, it's best to do nothing." Yup, it ain't a lot of fun... and often uncomfortable, but sitting on your hands is sometimes the best thing to do in a volatile market. Volatility often precedes a change in trend as the Bulls and Bears duke it out for control of the trend. Gold and Silver are caught in the vortex. Remain confident that no matter which side of the fence the dust settles...Gold and Silver will be moving higher. They have been for the past 6+ years, and the fundamentals to sustain a move higher are stronger today than when this Bull Market in Precious Metals began in 2001. It just amuses me how the price of Oil has hit "record highs" and the media has basically turned a cold shoulder to this lurking economic bone crusher. $80 Oil should change that...$100 Oil could ignite a panic.

Interesting that Gold and Silver's after market rise hit a wall hard as the Asian Markets opened this evening. What this could portend is anybody's guess. But last nights drop in the Asian/London markets was unusually "extreme". Then again, their Stock Markets got pasted overnight. Fools running from their risky Gold holdings? I suspect more monkey business...remember, every seller has a buyer and every holder still has his Gold and Silver. Hang on to yours!

Briefly... Gold did well to hold 659 and it's daily uptrend line off it's June 26th low. 50 day moving average on my charts is 660.28. Though pushing on it for the past six trading days, it has so far held up as support. A move though 668 could put a little pressure on the paper pushing Vermin on the Comex.

Silver, below it's 50 day moving average at 13.00 has kept it's head up, but would do well to open up that 6-pack of Whip Ass stashed in the trunk. A Reverse Head & Shoulders bottom has developed on the daily chart of Silver. Silver shorts will get pasted on a break of the neckline near 13.40 . Just an observation...paper pushers be damned!