I did an interview with This Week in Money over the weekend about my outlook in regards to the stock market and gold for the rest of this year.
Stock Market News
Video update on the stock market and gold.
Enjoy the holiday!
The herd has formed.
The HUI gold stock index went into a bear market in 2011 and made a crash bottom this summer. It has since been going through a stage one base which acts as a transition phase between a bear bottom and new bull market.
We have now reached the point where the professionals are no longer using investment techniques to make their decisions in the US stock market.
Today the Drudgereport published a story saying that in just a few weeks Maria Bartiromo is going to leave CNBC to work for FOX.
Yesterday future Federal Reserve Chairperson Janet Yellen introduced herself to Congress and to the world and made statements that helped spur further buying in the stock market.
We have what you can call a cliff hanger chart for the S&P 500. This happens after the stock market runs up for several weeks and sentiment gets extremely bullish. You start to hear people say that valuations no longer matter and YOU MUST buy stocks for whatever new theories they come up with.
Even though the stock market had its dip in the United States thanks to the government shutdown markets all over the world are booming. Europe is taking off.
What we need to think about as investors is where to make money. And you do that by investing in early bull markets or markets that start new bull markets and not ones that are already years into one.
I do not expect the problems to be fixed today or anytime soon. And because of that I made the decision long ago not to expect the government to help me achieve goals in life.
Today I decided to do a video stock market update before the opening bell and show you what is the most dangerous part of the US stock market right now. This is where a bubble has been forming and is growing.
If you ignore the anger and look at what is actually happening today there is no big selling in world markets. Japan is up. A few of the markets in Europe are up and a few are down. But there is no big selling anywhere.
We don't know when the government will open back up or when a deal will be made. All the news was yesterday is that FINALLY after a week the White House and the Republicans in Congress are talking with one another. Up until now all they have been doing is playing to the TV cameras.
I really do not want to say much today, because I don't want to be a part of the TV conversation going on right now. They are all yelling and making partisan arguments, and I really have no interest in being a part of that.
Here is what you need to know about government shut downs. There have been seventeen of them since the 1970's and not a single one of them has caused a crash in the stock market. One of them lasted almost a month.
As we approach today's opening bell the S&P 500 futures are down over 7 points while gold is up 15. Markets around the world are mixed. Some are up and some are down.
Commodities and oil prices are in a position to go higher going forward no matter what, not because of Syria, but because they are in a position to resume their secular bull market. Syria has very little impact on oil prices.
This is going to promise to be a disgusting month of war and mayhem. We already got President Obama this weekend saying that he does not need a Congressional authorization to start a war, but he is going to give us a gift of allowing Congress to debate it and vote on it first.
Yesterday gold and European markets went up, but trading on the Nasdaq was halted throughout most of the day. Apparently there was a computer glitch and the rulers of the Nasdaq decided to shut all Nasdaq computer trading down.
Yesterday the S&P 500 fell 9 points and the DOW fell over 90. Thank goodness for the pullback. What we did not want see is the S&P 500 explode higher for a climatic crazy one day reversal. You see we did not want to see the S&P 500 go up 30 points on some "good" news yesterday and then close in the red, because that would signal the start of a big correction.
Yesterday the stock market rallied hard again after Ben Bernanke reaffirmed his QE money printing policies after the close Wednesday. He repudiated all his supposed tough talk about trimming back the size of QE last month.
The stock market is gapping up a little today as CNBC reports that Alcoa has beaten its earnings estimates. It does just about every single quarter as analysts always underestimates its earnings. That helps provoke good news for the company and gets them some media attention too. In reality the company lost a lot of money.
If you say that if he means what he says, then you believe in Father Christmas. He said if the economy does not meet the expectations of the fed in one years' time, they will consider additional measures. In other words, if the economy has not fully recovered by mid-2014, more QE will be forthcoming. As I said already three years ago, we are going to go with the Fed to QE99.
Markets got hit after Bernanke talked and everything is getting sold this morning. Gold is below its recent lows. I still think it is likely to turn around and begin a bull market soon so I am watching it closely. I want to see what it does by the end of the day.
There is a lot of talk that the Fed is going to stop buying bonds and get tight. I don't believe any of this, because I don't think it can.
Well we just saw two days of shaky stock market action. All the market did though was pull back off of its highs, but that is enough to get some Fed members to get on TV and proclaim that the Fed will not be ending QE anytime soon.
Hedge fund manager Kyle Bass has been pushing a short Japanese bond trade for years, eventually he may be right.
Here are some stories today that caught my eye.
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