What is the mentality of investors right now?
On today’s market wrap we chat with Doc and Chris covering a number of markets. The biggest question is with some of the breakouts in oil and silver is should we be chasing these sectors higher?
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I think that the Fed just lost its independence with the recent meeting between Obama and Yellen. That is the unsaid message we all got when news broke he would meet with her following the Fed emergency meeting. Politics will rule over CB desires again and again because what motivates each are quite different from the other even if on the surface they should align. Basically it does not matter what conclusions the Fed came too. The President is going to have told her what she needs to do next (or not do as the case may be). And I think further rate hikes have been nixed.
farmer if yellen does not hike stocks will rise and commodities fall.Gold yields nothing.
It could also be the case of buy the rumour sell the news.Who knows.We are living in a weird world were traders have to anticipate to make money albeit I think that many investment banks have inside information.I scratch your back you scratch mine.I fund your electoral campaign and you disclose all the confidential info that you have and legislate loopholes that grant me immunity i.e. the freedom to rip off everyone on earth
So sad Don C that we are where we are!
My take is, gold does well from here on (of course, not in a straight line) no matter what the decision is, but will do far better if they hike.
Stewart Thomson:
“Both the Bank of Japan (BOJ) and the US Central Bank have major announcements coming on April 27. HSBC economists are forecasting that Japan could announce what I’ve dubbed a “QE For The Citizens” program. The BOJ may actually print money and give it to the citizens to spend. That’s very inflationary.
Institutional buying of gold stocks in anticipation of such a program may be adding fuel to the current “rocket rally”. Also, savers are one of the main backbones of capitalism. I think Janet Yellen probably wants to raise rates in America on the same day that the BOJ’s Kuroda announces what is essentially a helicopter money drop.
A rate hike in America on April 27 could cause a horrific US stock market sell-off. Janet’s first rate hike caused a major equities market meltdown, and a surge into the yen and gold.
A second hike, against the background of helicopter action in Japan, could see the yen ignored as a safe haven. Gold and silver may stand alone, as the safe havens for institutional liquidity flows.”
http://www.321gold.com/editorials/thomson_s/thomson_s_041216.html
I think you are probably correct Bird.
GREAT WRAP GENTLEMEN……………….
+1 It is great to hear the guys wrap up the markets. Many good thoughts on Oil, Gold, Silver, the Fed, the dollar, and the macro picture.
Energy has got to be a “staple” of every bodys portfolio?
For the long term that is what I believe.
Energy has definitely always been a staple in my portfolio. Oil, Nat Gas, Nuclear, Lithium, and Renewable energy sources like Solar, Wind, Geothermal, Hydroelectric, and Tidal.
So much for focusing on the most undervalued asset.
What? Uranium and Lithium were down 90-95% by the end of 2015 and were by far some of the most undervalued sectors on the planet (more so than even the PMs). Oil has had a landmark slide from $115 a barrel to $26 a barrel blowing almost all analysts minds with how far it fell. Renewable energy got started on hot air, then was decimated by government scandals and the 2008 financial crisis, and had to completely reinvent itself with real companies that are making real progress. Nat Gas is the dumper, and heating oil and Kerosene have never been so decimated.
I’m not sure I understand your comment B – or maybe you just don’t understand how beaten up the energy sector is.
Also, diversification of assets is part of any wise financial planning and investing strategy. I’m not just going to buy a bathtub full of gold coins and bath in them….
FIC;
Yellen was NEVER going to hike rates again, whatever she said.
The ONLY muddle through mechanism for the US is create inflation, and pray that sooner or later the economy can outgrow the inflation.
I don’t think there is a mindset among the “progressive” politics of either party to decrease spending AND decrease taxes, without which the death spiral will continue.
(Progressive sounds so good, but it could be just as well replaced by the word moronic.)
You could be right CFS. Maybe it was one and done as others averred. Yet still, in the back of my mind I cannot imagine the President met with her for just minor chit chat. There are obviously worries and I suspect he needs to be sure the Fed won’t do anything to tip the apple cart leading into the elections.
In other words….he was heading her off at the pass.
The Big Zero is very worried that the stock market will drop and thus virtually the only positive aspect of his economic policy will demonstrate that he really is a divisive economoron.
He is hoping to pass on to the next administration the complete mess he has made of the country and escape the blame that will be heaped upon him.
CFS, Econodevil in my sight, but yet that is the spirit of deception that envelopes both DC & Wall St.
I agree with both of you Marty and CFS
Doc, on thursday show you was mocking a analyst (gary) because he thought oil was going to 50, now a couple of days later you are saying oil is going to 50 weird
Let’s put this in the correct time frame my friend. If you do that you will understand the total lack of any truth to what you are saying. Sorry!
Al, do not understand this response, doc say he see oil going to 50 soon then a retracement, but on thursday he was saying no way we going to see 50 . What i am asking is why the 360 reverse in less than two days what technicals has change to make Doc so bullish
Anybody have any ideas on Titan Oil recovery?
“Revitalizing Oil Fields with State of the Art Microbially Enhanced Oil Recovery (MEOR) Technology
— Proprietary, Proven and Specific”
This is a bit long but it poses some interesting questions.
http://www.bloomberg.com/news/articles/2016-04-12/imf-warns-of-global-stagnation-as-it-cuts-growth-outlook-again
SORRY…Did not mean to post that.
Ha Ha…what if you had accidentally posted naked pics of celebrities instead. Now THAT would be funny!
Reminds me of the time I worked for a silicon valley internet firm and a senior VP, doing a global web meeting, forgot that his browser was on a hardcore porn site. When it came to his turn to talk and show some powerpoint up popped his browser on everyone’s screen from San Jose to Sydney to London.
There was a moment of pause follwed by a bunch of Brits, Kiwis and Aussies laughing out loud down the lines… and then a pause before an American lady was heard to say:
“I don’t appear to have that slide.”.
Hilarious.
Life’s memorable moments!
Apology, of course is not accepted!
Don’t give him an inch to wiggle Big Al. 😉
Thanks Guys.
That’s a zillion yen, a month.… and it still keeps getting stronger!
Bought more GYEN today. It’ll pay off some day soon I reckon.
Have not listened to the wrap yet but, boy, that crude build seems a tad devious doesn’t it.
Not read beyond the headlines yet but that could be a game-changer for crude tomorrow.
This rigged Fed controlled market is a complete joke, so I’m just buying more silver and waiting out in OTM options for an all out crash.
I still suspect massive deflation will prevail this year despite endless central bank interventions.
Gold products used in Islamic finance would need to be physically-backed and allocated to the underlying asset, according to a draft of a standard for Shariah gold being developed.
“We are almost there” with a final proposal, said Mohd Daud Bakar, a Shariah scholar who is writing the draft for the Accounting and Auditing Organisation for Islamic Financial Institutions, the Bahrain-based industry group that sets Shariah standards in finance. The committee formed to develop the gold standard will meet once more next Sunday and then submit the proposal to AAOIFI’s Shariah Board, he said in an interview in Dubai on Sunday
I just saw this as kinda funny, goldbugs agreeing with a little shariah law.
It’s even funnier that the “sophisticated” people of the West don’t demand honest money themselves.
Oil has probably risen too much based on hopes of an agreement. It has the potential to quickly drop 10% if nothing significant happens and there is a good chance of no agreement and further future talks.
I agree that’s why I shorted it, but then it rose to a ridiculous level. Doc has me concerned now because he mentioned it may shoot up to $50. Looks like I’ll be up in the early morning watching the pre-market trading so I don’t get my clock cleaned.
I’ve had 6 good Oil trades in a row, and I was hoping for Lucky 7, but Oil just kept running and running today. I was planning on it to double top or stop short of double-topping. The strength really surprised me because there is no reason for Oil to be up over $42 again. Yes the US dollar has been very weak, but still, the supply glut is at record levels and the summer driving season isn’t going to make a dent in the gasoline reserves either.
I feel stupid taking profits on my big BP position a day too early and missed another 9 or 10k in gains. It is time for the dollar to rally and that might encourage traders to start selling gold and oil. There was a sharp drop by some major traders after the close yesterday to take down oil and they will try to put a lid on any rallies now.
Oil has been relatively easy to trade the last 2 months, but this last week has been quite volatile and unpredictable. I may just go to the sideline until it makes up its mind.
This is interesting. Rigged options could get smoked. I wouldn’t be long just yet.
http://www.zerohedge.com/news/2016-04-12/gold-options-traders-extend-longest-bullish-streak-2009
Is that mean another wash out on gold before going up your opinion?
This headline caught my eye. Whether it’s worthy of consideration, you have to decide: http://www.mineweb.com/articles-by-type/analysis/85-dollar-crude-oil-by-christmas-an-interview-with-mike-rothman/
Lots of people suggest it’s gambling to invest in mining stocks. Here’s a chart to show them that quite a few ‘normal investors’ are obviously gambling in the conventionals with OPM! http://jugglingdynamite.com/wp-content/uploads/2016/04/NYSE-margin-debt-SPX-growth-since-1995.gif
Thanks Silverdollar. I like that chart. See that head and shoulders top on the margin debt (red line)? That’s what I was talking about yesterday. The markets going down. Timing it is another issue of course but it feels like a breakdown is getting close.
Good chart on margin debt. I am amazed but not surprised that it is that high in the conventional stock markets. Yes, in their minds this kind of “gambling” is endorsed, but it is actually far riskier than buying the miners at their low levels today compared to where the where 4-5 years ago.
Here is an article that is an absolute “must read” for those ding-dongs who keep bleating that inflation is in our future. The article is written by David Stockman who is in China at this moment and trying to absorb the evidence of the single largest economic excess in human history.
His conclusions should be sobering for those who think we might escape the noose when the tottering edifice of credit comes falling down around our ears later this year. And it IS coming. Make no mistake about that. A true commodities recovery seems almost unthinkable with China as the backdrop.
Rather, we could have depressed prices and flaccid global demand for more than a decade in the future. There is no V-shaped recovery in store for most of the industrial materials and resources that China has until now been using at a break-neck speed.
And if that is true and if gold still functions as a commodity then this deflation is going to run a few more innings before even scant signs of recovery show green shoots again. Meanwhile, you all ought to be cautious when buying Chinese firms. The defaults should be epic and yet they have hardly begun. In all liklihood the carnage on the Shanghai will not end until it has retraced to the 1500 level.
It is depressing beyond measure. Buyers beware.
The New Middle Kingdom Of Concrete And The Red Depression Ahead – -David Stockman
http://www.zerohedge.com/news/2016-04-12/new-middle-kingdom-concrete-and-red-depression-ahead
SantaCruz Silver (V.SCZ)
Still cheap! Only around .40 a share bought has double in the short term.
In production!
http://www.santacruzsilver.com/s/home.asp
Thank Chad. I’ve been noticing Santacruz Silver making a comeback lately. It is about time as they were way oversold. A good reminder and much appreciated.
We will get inflation. The Fed WILL cause inflation. The question is how soon and will it destroy the dollar in producing inflation.