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Domestic Debt, Dollars, Derivatives and Dumbies

By Roger Wiegand      Printer Friendly Version
Jun 27 2008 9:15AM

www.webeatthestreet.com

Politicians appeal to a large contingent of confused people. Give me security and a free lunch and you’ve got my vote and eternal political love forever after.

Domestic debt both public and private now seems immeasurable. Diluted dollars diminish purchasing power raising prices. The dumbies who’ve instigated this mess have addresses at the Federal Reserve, New York’s investment banks and our United States Treasury. They have other economically retarded friends in similar government posts throughout the world. All are energetic proponents of skinning the Sheeple by skimming cash using inflation and writing fraudulent paper. This accelerating event has been in process for years but new heights were achieved as derivative boldness took it over the top.

The Hangover Began in 2006 With Housing

As the current unraveling process evolves, horrific and sometimes economically fatal mistakes have surfaced to the light of day. Crack-ups in credit, housing, autos and other consumer related disasters led the way. As usual the fallout gave us inflation and racing rallies in commodities, which immediately caught the attention of our mentally-challenged congress. Always looking for an issue to burn more cash and buy votes, these dopy dorks plunged ahead lashing out, attacking oil executives, and disparaging commodities traders and agricultural businessmen. These attacks proclaim they are “doing something? when a mirror easily and correctly points the blame. Seemingly, everything they touch is trashed. Their tragically inflicted results affect not only America but other innocents’ over the globe. We are in for a sure recession and in my view headed for a depression. Their party line is denial.

Fault Lies In Plain Sight

Virtually all of these nasty problems, we’re convinced, are a direct result of subnormal intellectual development. Their logic, common sense and brain power seems arrested by too many years in the hollow halls of law-making. We’ve also noticed a larger portion were educated at Ivy League schools located in the northeastern USA. We can’t define the problem, but perhaps it’s a misaligned gene pool, bad air, or water, or some other contagious familial mental aberration. These dudes and dudettes, suffer from foolish utterance, imbedded in their genes or bent by an economic DNA cerebral hemorrhage strategically originating from lowest measurable IQ ranges. Why are they all from Yale, Harvard and the like? Are the think tanks of the world imbedded with incestuous political-economic education? The precious few with any common sense seem to arrive from an ethical, solid working background easily discovered throughout the middle section of our country. Residence near an ocean likely creates aberrant eco-politics at least compared with strict rules found in the U.S. Constitution and Bill of Rights.

US Representative-Dumbos cruise state capitals and Washington accompanied by that Deliberative Senatorial Body of dazed idiots; economic party crashers determined to leave a pile of consumer-business people behind in catastrophic smoking commerce wreckage. Sadly for our citizens their political agenda mental illness-craziness is remarkably successful. It works because the confused Sheeple want and think they deserve a free lunch.

In watching this year’s presidential primary dancing we’ve spotted another disaster in the making. It seems to us this is a prelude to old-style treacherous political business as usual. The new and not so new Republicrats (That’s a brain-dead, deranged genetic cross between a Republican and a Democrat) promises change and offers nothing. It will not matter in the least who’s elected; congress and big business hold the power reins telling any new president how to dance. And, believe me they can make him, or her do the Crush-The-Sheeple-Two-Step, or it’s adios political career.

Compare 1930’s Germany with America today.

That was a fascist state ideologically defined as “belligerent nationalism.?

“Fascism is a system of government that advocates or exercises a dictatorship of the extreme right, typically through the merging of state and business leadership together with an ideology of belligerent nationalism.?

-American Heritage Dictionary

 Is that accurate or what? Basically it’s a marriage between big government (a puppet of big business) and our government’s masters working in big banks, and other corporations whose un-American issues are advanced through efforts of highly paid capital lobbyists. There is no allegiance to country, the common man, or woman, their employment, personal or national debts, compassion for the poor and as of late, education of the masses. War is a tool for greed not necessarily for national security. Iraq is about big oil. Iran will be about big oil. Domestic social programs are about votes, make-work jobs and advancing corporate control over law, or lack thereof. It’s all about let’s-make-a- deal-and millions, and pound others (most of the world) into the fiscal dirt. We say the chickens are coming home to roost and they are big nasty, dirty birds infested with a host of economic maladies. We have no compassion whatsoever for these treacherous instigators. What goes around comes around. Next comes pure socialism. What’s after that?

New Power For Inflation Markets

Primary drivers of inflation are rising oil and gas prices coupled with a sinking US Dollar.

On Thursday, June 26, 2008, the Dow Jones Industrial Average sank -358.41 points as traders scrambled to exit mainstream shares. The all important S&P 500 skidded -38.82; an extremely negative session to say the least. In our view this terrible day on the exchanges for non-commodity markets was a reaction to the prospect of rabid forthcoming inflation and the inability of our hapless, helpless Federal Reserve to repair any of this. They are in hot water with no escape but to print more dollars, delaying the inevitable, producing eventually, hyperinflation.

After crude oil closed at $139.00 and change, adding +$5.09 to its most active futures contract, oil rose even more, to over $140+ in after hours trading. We forecast major markets intervention for Friday, June 27 in an effort to stop the selling. How effective these fiddling efforts can be we’ll discover on Friday. With each new heroic effort induced by the Plunge Protection Team it takes more manipulation and propping to obtain the last event’s results. It is obvious they are swimming against the tide and losing this battle in preparation to finally drown in their own tragic mistakes.

The US Dollar index took a pounding from the pre-open on Thursday all the way to the close at 72.80. As the USA’s financial troubles deepen, fallout is spreading into the middle and eastern Canadian provinces. Since we trade the Canadian Dollar long and it has been good to us we watch it closely. Now, however, the C$ is selling more often when the US Dollar is selling. Previous to this time the C$ would not do this but would inverse rally. On the other hand, the last bastion of safer currencies seems to be the Swiss Franc that opened at .9664 this morning and in after hours is up over one full point adding +1.17 to .9779 on September futures. The world at large views the Swiss Franc as their last chance to preserve wealth along with gold and silver.

The all important 30-year bond though trending lower in price bounced back today as share traders fled equities and bought the bonds adding a huge +2.85 points as traders scurried to safety. Natural gas had been selling back but in today’s wild session did a pivot reverse rallying to 13.268.

Gold and silver had a fabulous trading day as December, 2008 daily gold futures added +$36.80, up a whopping +4.1%. Silver was busy too as it closed at $17.4 on December, 2008 futures adding +$.66, up +3.9%.

Watch what happens to commodities this summer with more bad weather and potential hurricanes.

Farmers have been pounded with inflation costs hitting them in gasoline, electric power, diesel fuel, seeds, fertilizer and their household cost of living. December corn was $7.88 just $.12 from our forecast annual high price. November soybeans closed at $15.614 nearing our trading goal of $16.00 per bushel toward our final 2008 higher price prediction of $18.00. The weather, fundamentals, technicals, global reserves and a potentially disastrous harvest all say higher prices ahead. Unfortunately, we forecast food rationing in the grains and for several other very poor nations. People are going to starve to death and the blame can be placed directly at the feet of government stupidity. Cheer-up, its gets worse in 2009 with crashing markets, and hyperinflative higher food and energy.

Gold and silver traders, shares’ investors and those with enough foresight to prepare will endure this mayhem without too much disruption and can in fact be handsomely rewarded.

Gold didn’t wait forthe August 2008 breakout cycle. It took off nicely today.

Spring Buying Cycle Has Arrived

Watch for new rallies in most all commodities markets in late August after an interim shorter term rally and profit-taking event. We should see channelized mini-rallies in gold and silver this summer. The bloom is off the rose and our off-schedule, nasty “Sell-in-May-And-Go-Away? arrived this day of June 26, 2008. However, our summer forecast is a mild haircut in most stock shares including precious metals. The only action to prevent selling is our stunningly time-worthy Plunge Protection Team who had multiple recent failures propping shares. Will they win during the June push-‘em-up event? We think with all the other market dangers they will prop their little hearts out and not permit the Dow and S&P 500 to get out of control. In our newsletter, Trader Tracks, we provide weekly guidance and extra e-mail alerts to report our best new trades and offer suggestions for trade management. Visit our website at (webeatthestreet.com) for more information on our spectacular futures and commodities trading record.

Whatever you do, make a concerted effort to stay with the trend and hang onto your core holdings of preferred shares, cash, and coins. Physical gold should never be sold or, traded but rather accumulated steadily on a monthly savings plan and squirreled away. Big traders are always ready to buy on the dips and normally never sell their gold and silver. You would be amazed how quickly your physical gold and silver will accumulate using this strategy. - Traderrog

Roger Wiegand
Editor Trader Tracks Newsletter
& The Rog Blog at webeatthestreet.com

 

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Roger Wiegand is Editor of Trader Tracks Newsletter for gold, silver and energy traders. Roger provides recommendations for short and longer term traditional stock shares and futures- commodities trading with specifics for individual trades.  See www.webeatthestreet.com for more information.

Contact Claudio Bassi, at Trader Tracks New York City publishing offices for a modestly priced trial subscription 718-457-1426 Monday through Friday, 9:30am to 5pm or, e-mail Claudio at cbassi@miningstocks.com