And how you can join the party
by Franklin Sanders, SilverBearCafe.com:
Over the course of the present bull market in silver and gold, probably another 10 years, silver should rise about four times as fast as gold. That forecast arises from silver’s historic performance, especially during the 20th century, as well as its present fundamentals. The best way to profit from that trend is to swap back and forth from silver to gold with the rise and fall in the gold/silver ratio. That strategy will convert a sterile investment into one that pays dividends, and possibly double the ounces you own over the life of the bull market.
GOLD vs. SILVER
Alas, poor silver is the Rodney Dangerfield of precious metals—it can’t get no respect. It certainly should merit respect, since its 20th century performance has far outpaced gold. It’s volatility and superior fundamentals ought to make it much more attractive than gold.
The fact is, gold bugs (with their blind, monomaniacal devotion to gold) miss the point. They are so ideologically wedded to the yellow metal that they overlook both history and facts.
Read More @ SilverBearCafe.com
In addition to the daily NEW QE/LSAP/ZIRP On again/Off again rumors, one of the most memorable aspects of a vacation-heavy August was the pervasive weakness in corporate top lines, coupled with a substantial portion of the S&P guiding lower into a very uncertain future. Perhaps this explains why when looking at the best performing asset classes of the past month, it is precisely those 'barbeque relish' vqrietals silver, and gold that shone, despite offering no dividends, and despite having not a single earnings call or forecast revision between them. Or perhaps in spite of.
Between
the thinness of European bond markets during the summer doldrums and
the hair-trigger momo-monkeys, it would appear that all the hopes and
prayers of the Draghi "promise" have been more than priced into the
Spanish bond curve already. Of course, short-dated yields could drop
further on ECB buying; but where exactly 'should' that risk premia be?
Of course, longer-dated yields could compress but does anyone really see
a solution here, as opposed to short-term support to get through some
debt maturities and avoid a catastrophic contagion? The
critical point being - for all the anticipation of Draghi's bond-buying
plan and its implicit conditionality, the Spanish yield curve has
priced it all in and more - as the 2s10s curve is now at all-time (pre-
and post- Euro-era) record steeps. We have seen this pattern
before - into and during LTRO - that did not end well; and the crowd is
getting larger and doors smaller in this one (and don't forget Corzine
won't be your fall-guy this time)...
by Franklin Sanders, SilverBearCafe.com:
Over the course of the present bull market in silver and gold, probably another 10 years, silver should rise about four times as fast as gold. That forecast arises from silver’s historic performance, especially during the 20th century, as well as its present fundamentals. The best way to profit from that trend is to swap back and forth from silver to gold with the rise and fall in the gold/silver ratio. That strategy will convert a sterile investment into one that pays dividends, and possibly double the ounces you own over the life of the bull market.
GOLD vs. SILVER
Alas, poor silver is the Rodney Dangerfield of precious metals—it can’t get no respect. It certainly should merit respect, since its 20th century performance has far outpaced gold. It’s volatility and superior fundamentals ought to make it much more attractive than gold.
The fact is, gold bugs (with their blind, monomaniacal devotion to gold) miss the point. They are so ideologically wedded to the yellow metal that they overlook both history and facts.
Read More @ SilverBearCafe.com
Silver Is Golden In August, As Gold Bests S&P Returns In Last Month
In addition to the daily NEW QE/LSAP/ZIRP On again/Off again rumors, one of the most memorable aspects of a vacation-heavy August was the pervasive weakness in corporate top lines, coupled with a substantial portion of the S&P guiding lower into a very uncertain future. Perhaps this explains why when looking at the best performing asset classes of the past month, it is precisely those 'barbeque relish' vqrietals silver, and gold that shone, despite offering no dividends, and despite having not a single earnings call or forecast revision between them. Or perhaps in spite of.
Socialist Lampoon's European Vacation Is Over As Merkel Calls To Order
Ahead of this week's 'critical' game-changing events - or not - it seems Europe's true overlord-ess is back, and now, tanned and relaxed, she is making clear that nothing about her (or her country's) view of the world has changed - no matter how much Draghi, Monti, Hollande, Rajoy or Samaras jawbone about it. It would seem by her words that expectations are being set and conditionality remains key - which means no matter what the ECB does - it is a can-kick no nearer an end-solution; and the market in its wisdom will price through that can-kick (after knee-jerking first of course): (via Bloomberg)- *MERKEL SAYS `DEBT MEANS DEPENDENCY'
- *MERKEL SAYS EU MUST ENSURE THAT IT FIRST EARNS WHAT IT SPENDS
- *MERKEL SAYS `ECONOMY THERE FOR PEOPLE, NOT PEOPLE FOR ECONOMY'
- *MERKEL SAYS EUROPE HAS TO LEARN TO ONLY SPEND WHAT IT TAKES IN
- *MERKEL SAYS TOO MANY IN EUROPE HAVE LIVED BEYOND THEIR MEANS
- *MERKEL 'ABSOLUTELY CONFIDENCE' ECB TO WORK WITHIN ITS MANDATE
Draghi's "Promise" Sends Hope Off The Charts
Between
the thinness of European bond markets during the summer doldrums and
the hair-trigger momo-monkeys, it would appear that all the hopes and
prayers of the Draghi "promise" have been more than priced into the
Spanish bond curve already. Of course, short-dated yields could drop
further on ECB buying; but where exactly 'should' that risk premia be?
Of course, longer-dated yields could compress but does anyone really see
a solution here, as opposed to short-term support to get through some
debt maturities and avoid a catastrophic contagion? The
critical point being - for all the anticipation of Draghi's bond-buying
plan and its implicit conditionality, the Spanish yield curve has
priced it all in and more - as the 2s10s curve is now at all-time (pre-
and post- Euro-era) record steeps. We have seen this pattern
before - into and during LTRO - that did not end well; and the crowd is
getting larger and doors smaller in this one (and don't forget Corzine
won't be your fall-guy this time)... European Safe Havens Bid As Big Three Questions Remain
Despite
a green showing in European equity indices this morning (aside from
Spain that is) - as they shrug off the dismal China/Aussie data
overnight in the incessant belief that bad is good and worse is better -
there is a bid in a number of the major AAA safe-haven assets in
Europe. Swiss 2Y rates are dropping notably this morning,
German and Danish 2Y rates are stable to dropping, and Dutch and
Finnish rates remain extremely low. It seems that between Merkel's
comments this morning and the following big three unanswered questions -
it's not all risk-on in Europe, and expectations for a squeeze in
EURUSD - with net shorts at 2012 lows and USD longs basically neutral -
seem exaggerated for now. Summing up on the euro area debt crisis, SocGen notes the issues remain the same;
the periphery faces an uphill battle to meet targets that few private
forecasters (including ourselves) expect can be reached, the EFSF/ESM is
still too small with Spain and Italy combined facing around €800bn of
funding needs over the coming three years and while the ECB can be
helpful, it alone is not enough.Carpe Diem, Quam Minimum Credula Postero
Tomorrow
the Battle of Frankfurt begins. Make no mistake in your thinking as
America ends its holiday weekend; it will be a battle and there will be
bodies littering the field of engagement. Spain and the rest have aims,
plans, schemes if not hopes and ambitions in direct opposition to
Germany and her side. The outcomes prayed for are a demand for money and
a resistance to those demands. The pleas of Spain are about to be
answered; first from the ECB and then from Germany’s acceptance or
rejection of the Draghi plan. The “Game of Muddle” will be ended and real answers to real insistences will be given.
It all comes down to this; money and how much of it and under what
circumstances and whether the nations with capital are willing to hand
it to their neighbors and watch their credit ratings, their own cost of
funding, their standards of living decline to a mean for all of Europe.The real story behind those Ron Paul delegates from Maine (Video of march from floor)
Eric De Groot at Eric De Groot - 3 hours ago
The public’s growing realization that the sovereign debt crisis cannot be
solved by either political party after the 2012 election increases the
probability that a formable third party will emerge for the 2016 election.
Headline: The real story behind those Ron Paul delegates from Maine (Video
of march from floor) TAMPA, September 2, 2012 – By the time of Marco
Rubio’s speech at the...
[[ This is a content summary only. Visit my website for full links, other
content, and more! ]]Global Manufacturing Update Indicates 80% Of The World Is Now In Contraction
With
the US closed today, the rest of the world is enjoying a moderate rise
in risk for the same old irrational reason we have all grown to loathe
in the New Normal: expectations of more easing, or "bad news if great
news", this time from China, which over the weekend reported the first official sub-50 PMI print declining from the magical 50.1 to 49.2, as now even the official RAND() Chinese
data has joined the HSBC PMI indicator in the contraction space for
the first time since November. Sadly, following today's manufacturing
PMI update, we find that the rest of the world is not doing any better,
and in fact of the 22 countries we track, 80% are now in contraction territory. True, Europe did experience a
modest bounce from multi-month lows of 44 in July to 45.1 in August
(below expectations of 45.3), but this is merely a dead cat bounce, not
the first, and certainly not the last, just like the US housing, and
now that China is officially in the red, expect the next shoe to drop
in Europe. Also expect global GDP to eventually succumb to the
manufacturing challenges faced by virtually every country in the world,
and to post a negative print in the coming months.Frontrunning: September 3
- Germans write off Greece, says poll (FT) - Only a quarter of Germans think Greece should stay in the eurozone
- As predicted here two months ago: ECB chief and Spanish PM on collision course (FT)
- Gold Wagers Jump To 5-Month High As Fed Spurs Rally (Bloomberg)
- Euro zone factories faltering as core crumbles (Reuters)
- Those who expected more China easing, beware: PBOC Has No Short Term Intention for Loose Money Policy (Financial Market News)
- French jobless tops three million, minister says (AFP)
- Spain Leads Europe’s $25 Billion Gamble Before ECB (Bloomberg)
- US investor is Ireland’s biggest creditor (FT)
- Draghi May See Silver Lining In Disappointing Investors (Bloomberg)
- China's steel traders expose banks' bad debts (Reuters)
- NY probes private equity tax strategy (FT)
Today’s Items:
More and more people are talking about a
gold standard. The Republicans, talking out their backside, are
calling for a so-called gold commission; however, the genie has already
been let out of the bottle. Returning to a gold standard, if not done
properly, could make things worse for many. Remember, if there is a way
for politicians to do the right thing or the self-serving thing, they
will choose the later every time.
Bill Murphy makes the case that the
government has been manipulating the price of gold for quite some time.
He believes that international market forces will overwhelm government
attempts at suppression; thus, the answer to are gold markets
manipulated by the government can be answered with a simple question…
Does a bear shit in the woods?
Michael Pento believes that Central Banks
will do something in September that will cause fiat currencies to be
flushed down the toilet. The European Central Bank and Federal Reserve
are both about to announce, this very month, an incredible assault on
the Euro and the dollar. Barnanke believes that he has given the market
stability, despite the fact that oil prices have gone from $147 to $33
and back to $100 within four years. The good news in all this printing
will be that the failed global experiment in fiat currencies may be
quickly coming to an end.
There is no more denying that the arrogant
and self-centered mainstream media are in the tank for Obama. For many
in the mainstream media, they do not see the writing on the wall that
their lies are becoming more transparent. Whether it is CNN, MSNBC, or even FOX News,
they are all dying, as are their elderly viewers, and giving way to the
the new alternate media sources. More and more are seeing that Romney
is the same as Obama is the same as Bush… Period.
Well, it now looks like Eric Holder has
tried his best to end Sheriff Arpaio’s career; however,the witch-hunt
investigation is now over. So, it now looks like the Sheriff can
continue to press for more information on the missing idiot of a Kenyan
village.
Suzanne Barr, Janet Incompenano’s gal pal,
was forced to resign, after it became clear that she had an informal
“No Men Allowed” policy when it came to promotions within the ICE
division of the Department of Homeland Insecurity. Lawsuits have been
filed against the ICE agency, where she worked. It looks like ICE just
got just a little too close to the FIRE.
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