A comprehensive market wrap with Doc, Chris and LPG
We have a nice round table market wrap today featuring Doc, Chris Temple and LPG. Topics covered include the US equity markets, gold, oil and the US dollar. Chris brings up some astute comments on the US dollar at the end so make sure you listen the whole way through.
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My personal belief Tad, is conventional equities down.
I am sure China wants Yuan down more but not to the level which crashes confidence. Chinese products need lower Yuan to compete with heavily devalued Yen and Won.
Corys stepfather runs exeter gold….
Agatha, that’s an interesting bit of info but what is your point. Are you implying something or is it just an immaterial observation?
Cory I believe is an accountant and mining companies do have accountants as all publicly and non-publicly traded companies do.
And your point is?
My comments on commodities and the dollar were not received well Dec 2014.
I was a Bear on commodities big time. CRB smashing to new lows today.
Sitting in cash at 2.5% doesn’t look so bad when markets crater 10-20% and stocks China is going to fry in time. The YUAN is toast in time….Careful out there folks….Preservation of capital is FIRST!
Have you looked at yen and euro? Are they more toast? Yuan gained about 40% against yen in the last few years.
Similar percentage to euro
Your looking in the review mirror….
Euro had its Crisis so did Japan……started in 1989. There no interest in Japan because they fell into deflation eons ago….China is brewing for a blow out….
Every banker is shit scared of another never never Japan scenario…
I graduated from Chinese university in early 80s and from graduate school in late 80s. Most of my classmates are still working and many of them are in very senior levels. By senior level I mean they are leader of multi billion dollar companies or administrating cities of millions of people. The china collapse theory goes extreme nowadays in the west. However, not only ordinary people don’t feel any contraction, these high level people know the problems very clearly and don’t feel any worry about collapse. Chinese are known to be pessimistic about themselves but I feel this is the first time people inside china is far more positive than the west. I have been communicating with my relatives and friends for the last year in order to see the problems. I will write something later when I get a better picture. I know western media has always been wrong about China and there is no reason it is right this time. to be fair, this is a period that the top leaders have got some real support from the people and first time i heard my father says the president is an okay person. To get that comment, he has to do a lot of good things. I heard there is an famous author in US who became famous by writing a book predicting china will collapse. He started in 2000 and predicted china will collapse that year and he revises his book every year. This year he predict the 16th time that China will collapse this year. His name is Gordon something. I think valentine was using his prediction last year in this show. How much credibility do you think he has? I would like to know many people really know China and verify what is happening in china instead of just following media?
Dragonite – Good thoughts on the actual Chinese marketplace, versus people’s perceptions of China based on media biases and misinformation. They are 2 different things…
Always nice to have an inside look………….thanks…………..
Happy to bring different view. The consensus I got from more senior people is that there are a lot of challenges in industry structure reform and some more political changes required. They are facing a tough time but if the nation gets over this and able to get rid of unhealthy industry sectors and practices, it might be a good thing. One person also mentioned that so far china has not chosen QE route. If worst comes, a QE can really shift wealth from people to the nation and save the economy but it will be very unpopular since people are savers there.
Many thanks for you insight Dragonite.
thank you Dragon… I have found this site to be a china basher… so I am glad to hear your side of things. First hand.
Birdman, please maintain your position here.. you are highly valued & in your own category.
Or – start up your own site (blog).. that would be awesome.. let Moriarty know and we will all pile in..!! We need first hand insight into africa… miss you Bird…
No China bashing from me. I have always differed with many I respect when it comes to China. Thanks Lawrence for showing me that I might not be wrong.
Sorry my Kid was messing around name / email change I didn’t even notice. Kids!
You got me all wrong on China…It won’t collapse but the YUAN is heading for more serious trouble. It creates huge distortions in the market place. Some will do well and many won’t.
Just like Canada…NO ONE thought oil could collapse like this and the econmy face plant this hard….The trend is still in force now. China has a great deal to do with it of course….
We will see how China’s banking does with their over priced housing and slow economy. Like Canada the pain has not tricked down yet.
These things take time.
If you can figure out the repercussions of a Currency depreciation you can capitalize on it!
Not unlike Canada’s smack down….Its a currency war. We will survive but it there will be road kill in the process….
I has nothing to do with bashing. I was first to bash Canada and I live here….for now…
We have complete morons running things. 15year commodity boom/windfall and the money has been spent and we are broke….
China is no different. You can only push a string so far…..
If China is great you should live there. I was born in Canada and I can’t stand the BS politics and propaganda. $7 Cauliflower…..wonderful
Dragonite.
You Bring up a good point.
Ive been hearing that’s the worlds going to collapse for years….
Nope. Just pain for everyone. Kinda like dominoes falling and each getting their own..
Ya see Canada is on the ropes but I just picked up another $400k in business this morning…I have more work then I know what to do with…
Not all are affected…
The airlines profits must be way up as fuel is way down and ticket prices never dropped…
See what Im getting at?
PS Dagonite
I’m sure Huawei will be doing fine in China 😉
Rogers is going all Huawei Cell technology this year.
They pretty much took over. Nortel is dead. ;-(
Thanks Bill, I know Huawei is a very good communication company. Both their cell phone and equipment are doing well.
We deployed the first Nortel CDMA….Sad as 100k jobs lost in Canada cause they got lazy and failed to innovate.
I helped deploy the first UMTS and LTE networks as well. I was amazed at how cheap the equipment was and how well it stood up.
Nortel site $300k 15 yrs ago
Huawei $35k
New sites should be must more powerful. Sad for Nortel. They got too comfortable due to government force feeding. My wife used to own NT stocks and I talked her out of it.
Al, ask your esteemed guests what my point is..
they will tell you…
I believe that my question is directed at you.
The Case For Gold With The World On The Edge Of Chaos —KWN
January 12, 2016
The Case For Gold With The World On The Edge Of Chaos
After a chaotic first week of trading to open 2016, today King World News is featuring a powerful interview with one of the greats in the business that discussed the case for gold with the world on the edge of chaos.
James Turk: “As we start the new year Eric, I have been seeing a lot of wrongheaded thinking about gold and silver. Typical is this quote from a Canadian newspaper:
“Gold, which pays no dividend, shines as a store of value when other investments also produce no yield in real, or after-inflation, terms. However, it loses luster as competing assets begin to offer higher payouts.”
It sounds compelling on the surface, but this journalist is actually doing his readers a disservice. Gold is not an investment; it is money. So it should not be compared to investments…
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Gold is a sterile asset that does not generate cash flow, just like a stack of hundred-dollar bills does not generate cash flow. They are money, and one uses money to make an investment.
We hold money to store the purchasing power we have earned until we are ready to spend it. Because gold is money, to determine its relative usefulness, gold should be compared to other forms of money — namely, national currencies.
As we saw from the tables included in the interview we did last week, gold and silver over the past 15 years have done far better in preserving purchasing power than any national currency. That’s the important point everyone should be focusing on.
Everyone should also be focusing on gold’s valuation, and in this regard I would like to go back to the interview we did in early December where I said, “it seems reasonable to conclude that gold and silver prices have fallen as far as they are going to fall.”
In the 25 trading days since it closed in New York at $1,054.20, gold has risen about 4.5%. Gold has risen on 14 of those days, about 25% of the time. The cumulative gain on these up days is $144, or an average of $10.29. On the 11 down days, gold dropped $9.12 on average.
The point of looking at these stats is to provide more evidence supporting the possibility that gold did indeed bottom in early December. These advance/decline stats show how gold is making good upside progress. Gold is demonstrating the follow-through necessary for it to be in a bull market.
So did gold actually bottom on December 2? Well, there’s the rub. We don’t know for sure, which is why they say a bell is never wrung at market tops or bottoms. All we can do is rely on the evidence as it presents itself over time.
So far at least, the evidence is turning more positive than negative. But there are still things to worry about. For example, silver has not done as well as gold. The gold/silver ratio since December 2 has risen from 75.4 to 78.9.
I get concerned when I see relative weakness like that in one metal’s performance compared to the other. Generally, in a precious metals bull market, the gold/silver ratio should be falling, not rising.
King World News – A Stunning View Of The War In The Silver MarketThe next big hurdle that we should be watching for is if gold can finally break above $1,100 while silver does the same thing at $14. These events will provide more solid evidence that the low is in place and the long-term bull market is finally resuming after their four-year correction.
Anyway, there is a simple answer to all of the above. It is a recommendation, Eric, that you and I have discussed many times before. In my view people should be accumulating gold on a regular dollar cost-averaging program.
You may not hit the exact low in gold or silver with your monthly purchase, but over time you will be pleased with the average price at which you accumulated your gold and silver. After all, what you are in effect doing is saving real money, and safe savings are an important asset in today’s uncertain world that is full of overvalued asset classes built upon a mountain of debt.” To hear more on the gold market from the man who advises
James has Ben b a good friend for a long time.
Seven years after he authored a doomed-to-fail executive order to close the Guantanamo Bay detention center, President Barack Obama is making the closure of the facility a priority for his final year in office, a top aide said Sunday.
“He feels an obligation to his successor to close that, and that’s why we’re going to do it,” White House Chief of Staff Denis McDonough said on Fox News Sunday.
Kranzler on global bubble bursting:
https://www.youtube.com/watch?v=2Q034s7HnH0
Thanks Professor.
GLD weekly:
Can it fill last weeks opening gap? It sure can but it never did fill a couple of gaps that happened in December, 2008. One was about 1% and the other nearly 3%….
GDX left a whopping 8% gap in 2008 that took many years to get filled:
A Kuwaiti news report says that Barack Obama is plotting to replace Ban Ki Moon as U.N. Secretary General in late 2016
Now, explain to me just why he would do that.
It’s been almost 13 years since anyone has had the chance to buy gold at its 12 year moving average…
Zoomed-in:
The Canadian dollar is very oversold:
http://schrts.co/cZRC7D
Fork based on closing prices.)
Cnd $ is a derivative of raw materials especially oil. It has to go lower to make oil E&P companies to survive. Otherwise Canada loses its core industry.
Agreed. The Oil / Loonie correlation is fairly close, and oil down making new lows is not doing the Canadian dollar any favors. “When I dip, you dip, we dip….”
Here is Oil with the Canadian dollar plotted behind:
http://stockcharts.com/h-sc/ui?s=%24WTIC&p=D&yr=5&mn=0&dy=0&id=p02173434372
Yes, and they’re both close to major lows, in my opinion and both are very oversold even on the monthly chart. Oil could spike lower but it doesn’t have to.
I hope you can see a monthly chart because the C$ just fell to support provide by a huge Schiff fork. If that breaks, then we have some modified Schiff fork support at 67.50 (this month).
So what you’re saying is now is good time for me to book a hotel stay in Canada and eat and travel on the cheap converting from dollars to loonies. Right?
Absolutely correct, Excelsior!
Yes! That’s what it’s all aboot, eh?!
😉
Thanks guys.
So equities sideways to down.
Oil & Gold down … until they go up.
Yuan going down. Do you think the Yen will follow suit?
Sterling is the weakest it’s been for a long time..