• Monetary Metals
    05/02/2016 - 01:28
    The price of gold shot up this week, and silver moved proportionally. Headlines are screaming for gold to hit $10,000 or $50,000. Does this alleged new bull market have legs?

Some Cold Water In The Face Of A Manic-Depressive Market That Has Overdosed On Lithium

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Thu, 12/02/2010 - 20:22 | 773776 Atomizer
Atomizer's picture

History repeats.

Free To Choose: The Tyranny of Control

Government planning and detailed control of economic activity lessens productive innovation, and consumer choice. Good, better, best, are replaced by "approved" or "authorized." Friedman shows how "established" industries or methods, seek government protection or subsidization in their attempts to stop or limit product improvements which they don't control. Friedman visits India, Japan and U.S.

Watch both videos.


Thu, 12/02/2010 - 20:41 | 773819 Rainman
Rainman's picture

Tossing live grenades is fun. Catching a whole nother matter.

Thu, 12/02/2010 - 20:25 | 773777 razorthin
razorthin's picture

Not surprising really.  It is the tug of war between reality and pumpitude that keeps us in this trading range.  It's been pretty easy to trade as long as you expect neither a breakout nor breakdown.

Thu, 12/02/2010 - 20:27 | 773790 ghostfaceinvestah
ghostfaceinvestah's picture

The single most important chart for the stock market is the growth of the Fed's balance sheet. Since March of 09 there is a near perfect correlation between the two (and the price of gold, for that matter).

In April of this year the Fed's balance sheet not only stopped growing, it started shrinking, as MBS paid off.  And of course that sucked money out of the stock market which caused the selloff.

As long as the Fed balance sheet keeps growing, the stock market will continue to rise.

Of course, what happens once the balance sheet stops growing?  Timber.

Thu, 12/02/2010 - 21:18 | 773891 Bob Sponge
Bob Sponge's picture

I have to wonder about timing this week. Maybe the market has been pumped like crazy to divert attention from the Fed bailout data released this week. You can't be happy and mad at the same time, so maybe they are hoping people are happy about the market going up instead of being pissed at the Fed for bailing out foreign banks.

Thu, 12/02/2010 - 22:01 | 773958 tsx500
tsx500's picture

no, that was just a huge coincidence that the huge rally and fed bailout data came at the same time .......

Thu, 12/02/2010 - 23:03 | 774107 rocker
rocker's picture

Don't forget, it's the jolly happy season too.  Just buy something for Christmas.  How about stocks. Buy the Fukn Dip. LOL

Thu, 12/02/2010 - 20:34 | 773797 Spalding_Smailes
Spalding_Smailes's picture

Truck tonnage rose to 0.8% in October according to the American Trucking Association.  September’s reading was also revised up to 1.8% (via ATA):

American Trucking Association Chief Economist Bob Costello -

“October tonnage levels were at the highest level in three months, even after accounting for typical seasonal shipping patterns. These gains fit with reports out of both the manufacturing and retail sectors and show there is a little bit of life in this economic recovery.PragmaticCapitalism


WASHINGTON, D.C. – Dec. 2, 2010 – The Association of American Railroads (AAR) today reported for the week ending Nov. 27, 2010, U.S. freight railroads maintained traffic gains of 3.2 percent over the same week last year, originating 254,121 carloads. The comparison week from 2009 included the Thanksgiving Holiday. Intermodal traffic for the week totaled 183,790 trailers and containers, up 10.8 percent compared with the same week in 2009, with container volume up 11.7 percent and trailer volume up 6.1 percent.

Thu, 12/02/2010 - 20:33 | 773803 Clockwork Orange
Clockwork Orange's picture

Rosey is no match for Ben. 

And, old rules no longer apply.

When the Fed supplants Japan as the #2 buyer of Treasuries, an entirely new ball game is underway.

Thu, 12/02/2010 - 20:34 | 773806 TheGreatPonzi
TheGreatPonzi's picture

Participating in this market, even in the form of shorts or calls, is somewhat bringing liquidity to the Ponzi.

The governement sponsored-Ponzi can last an eternity, and the only thing you will gain trading this market or waiting for the collapse is your nerves broken.

Central banks and governments can make miracles when they refuse to let the reality win. Bailout to bailout, QE to QE, they can save a ridiculously fragile economy, facing total collapse each time the ECB or the FED does not announce exceptional measures, which they will announce, because they wake up each day terrified.

Dump your dollars, stop trading, buy gold and ammo, stop worrying and wait for the collapse, which can be postponed for a very long time, but will come after all in five years max.

Thu, 12/02/2010 - 20:38 | 773813 jm
jm's picture

or not.

Thu, 12/02/2010 - 20:50 | 773830 TheGreatPonzi
TheGreatPonzi's picture

Can you emphasize your answer, please?

It has already lasted 3 years and 4 months since the economy faced total collapse in the absence of governmental action, it can certainly last a few years more. Sorry to say that, but you have to be realistic.

Thu, 12/02/2010 - 22:18 | 773998 jm
jm's picture

"Dump your dollars"... reasonable enough.

"Stop trading"... hell to the no.

"Buy ammo"... seen enough of that crap in my lifetime already.

"Wait for the collapse which will come after all in five years max"... or not.


Thu, 12/02/2010 - 20:41 | 773820 putbuyer
Thu, 12/02/2010 - 21:29 | 773906 Implicit simplicit
Implicit simplicit's picture

Now we have 12/7 and 12/15 dates to watch.

12/7- bank withdrawals and wick BAC leak

12/15- tax cuts extension or not decision

Should prove interesting.

Thu, 12/02/2010 - 22:01 | 773959 billhilly
billhilly's picture

Hell, with all the insider selling going on I think folks are already preparing for the Cap-gains tax increase.

Thu, 12/02/2010 - 22:29 | 774022 prophet
prophet's picture

Definitely one for the math department but the gist of it is something like what follows.

Invested 100, now worth 160.  At 15% rate I pay 9 in taxes, net 51.  At 20% rate I pay 12 in taxes, net 48.

Juice my 160 to 163.75 (a 2.34% gain (oh yea that gone done in the last two days didn't it)) and I pay 12.75 in taxes, net 51.

Not a factor for the informed investor, just a tool for the industry to try and move money. 

Thu, 12/02/2010 - 20:49 | 773828 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

ISM I-S-shmem ...

Liquidity is sloshing around in the bowl. Notions of cause and effect can become traps at this point. The market is self reflexive and the economy is self reflexive because people are self reflexive and self referential.

All of this liquidity can certainly kick start a real economy. Lurching too and fro is the by product of liquidity which is compressing time frames. Money is available instantaneously, so decisions of risk on risk off need to be made instantaneously in order to keep up with the money ...

Thu, 12/02/2010 - 20:54 | 773841 no cnbc cretin
no cnbc cretin's picture

The U.S. ISM manufacturing index that came out yesterday, it actually came in below expected (bucking the regional indicators and dipping to 56.6 from 56.9). WTF, what isn't I don't get? I know we're in a depresson, soon to get worst, but why 56.6 vs 56.9 such a big deal? I would have thought 30 vs 56.9 would be huge. Not just .3 - and if just that small amount is huge deal, we're screwed, how stupid is that?

Thu, 12/02/2010 - 20:55 | 773846 erik
erik's picture

Does the same hold true for ISM Services?

Thu, 12/02/2010 - 20:57 | 773848 goldmiddelfinger
goldmiddelfinger's picture

This lines up with all the optimistic CEOs and PMs CNBC and Bloomberg parade on plus 250 and plus 100 days. They are putting inventory build on steroids with a specious bet that consumers will be back cards in hand.

Thu, 12/02/2010 - 21:14 | 773882 Don Birnam
Don Birnam's picture


Thu, 12/02/2010 - 20:59 | 773854 max2205
max2205's picture

TD it's too late dude, the vortex is about to hit terminal velocity. Everything will be suck in and spit out at much higher altitude (price).

Time to let go of the pole and wear a parachute so our fall will not hurt too much.

Thu, 12/02/2010 - 21:05 | 773866 greenewave
greenewave's picture

The Worst of the Financial Crisis Finally Over!!, watch this video "DICK Bove –“Worst of Financial Crisis Finally Over and Sarah Palin Reality TV!!" at (http://youtu.be/SCZ-uFwHvV4).

by Anonymous

HAha awesome video gives me hope that some people in this? country have their heads on their shoulder. People are really losing it.

Thu, 12/02/2010 - 22:40 | 774042 VisualCSharp
VisualCSharp's picture

Just curious. Why are you always posting URLs to youtu.be and not directly to youtube.com? Are you getting AdSense revenue from having links exposed on ZeroHedge? I'll continue to junk your posts as long as they have this stink.

Thu, 12/02/2010 - 22:43 | 774046 VisualCSharp
VisualCSharp's picture

Ah, I see. Youtu.be is Google's URL shortener for youtube.com.

Even still, your posts strike me as nothing but simple advertisements. And what's with the "by Anonymous" followed by a reply pretending as if you have no interest in "GreeneWave?"

Thu, 12/02/2010 - 21:08 | 773876 HedgeFundManager
HedgeFundManager's picture

The bullishness is making me puke. Listening to all these hedge fund clowns talking about stocks being cheap to bonds. What a scam.

Thu, 12/02/2010 - 21:14 | 773881 TheGreatPonzi
TheGreatPonzi's picture

These hedge fund clowns actually want to make money, not to provide profitable and moral investment advice to the sheeple. They don't care about making wrong forecasts.

They will recommend you to buy on CNBC, saying the economy is improving and all the shit, while accumulating a big short position behind the scenes.

Nobody will ever confront them.

Fri, 12/03/2010 - 01:08 | 774322 SheepDog-One
SheepDog-One's picture

Yea bullish over what....the conclusion Ben will now pump the markets as the 'new normal' is flawless, or can even work for a short time in the face of obviously horrible economic reality?

Thu, 12/02/2010 - 21:08 | 773877 Sokhmate
Sokhmate's picture

Lithium cures all. Arsenic,once we run out.

Fri, 12/03/2010 - 09:54 | 774918 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Interesting piece in WSJ about bacteria that use ARSENIC as a foundation for their DNA ...

If bacteria can do it, maybe bankers can too ...

Thu, 12/02/2010 - 21:12 | 773879 goldmiddelfinger
goldmiddelfinger's picture

You could post some charts of transport names here.

CSX and CHRW-just to name 2 starting with "c"

Thu, 12/02/2010 - 21:21 | 773896 Caviar Emptor
Caviar Emptor's picture

The economy, aka the paper pyramid, must suck at the teat of the Fed for any growth. That is one clear consequence of the crisis and the response. The US economy has definitively crossed the line out of capitalism and closer to the state run enterprise model of China. To lever up, Wall Street will be looking East to banks and investors interested in becoming the new partners in crime. Anyone looking for sleaze will find it. We're now fully committed to this course because growth in the real economy can never match the needed levels of gains to compensate for the amount of paper and debt incurred. Paper will back paper. Until it doesn't. 

Thu, 12/02/2010 - 21:32 | 773910 TheGreatPonzi
TheGreatPonzi's picture

China? Actually, when you look at the corporate and income tax rates, there is less statism in China now than in the USA now.

Thu, 12/02/2010 - 21:23 | 773897 Jim Billy Bob J...
Jim Billy Bob James IV's picture

Every action results in a reaction -



Thu, 12/02/2010 - 21:23 | 773898 Budd Fox
Budd Fox's picture

Tossing live grenades in Central Bankers' underwear! THAT is the ultimate fun

Thu, 12/02/2010 - 21:38 | 773900 Budd Fox
Budd Fox's picture

Sorry, fat impatient finger.

Thu, 12/02/2010 - 21:39 | 773909 gloomboomdoom
gloomboomdoom's picture



Hey, Bucky. "Here is a 60 inch plasma, for $500 dollars"

It is gonna bust folks. China. Collapse of price structure. Reboot. BAM new currency.






Fri, 12/03/2010 - 02:02 | 774424 trav7777
trav7777's picture

Whatever you say, Gen.

Sure, prices will fall below the energy cost of production...right; and the notes of a bankrupt state will become more worthful

Thu, 12/02/2010 - 21:46 | 773925 Cui Bono
Cui Bono's picture

Been watching a documentary on ABC about a family owned manufacturing concern that has run afoul of local law so they shut the factory down.... Very disturbing... I hope it has a happy ending......

BTW- One guy actually said "Release the Kringle"

Thu, 12/02/2010 - 21:48 | 773927 Paul Thomason
Paul Thomason's picture

Excuse me for 4. questions that might be naive, but I just can't work out what is happening any more and hope some wiser people than me can help me undertsand;

1. Is market manipulation illegal?.

2. Is what the Fed doing manipulation?. 

3. If the Fed says it is deliberately manipulating asset prices then if the answer to  question's 1. & 2. is yes, then I don't get it - isn't what they are doing illegal?.

4. My last question is, why is that when banks get caught committing fraud etc that they make a 'settlement' with the SEC?.  How come they can pay a fine and there is no criminal charges?, - clearly there is a counterparty that has been wronged and the law has been broken?.  Isn't a settlement just like a bribe?.

Sorry for these silly questions and this may be the wrong place but I just can't make any sense of what is going on?. 


Thank you in advance.


Thu, 12/02/2010 - 22:18 | 773999 TheGreatPonzi
TheGreatPonzi's picture

I don't have the pretention to be wiser, but I think I can answer these questions.

"1. Is market manipulation illegal?."

Yes. This is not in the FED mandate.

"2. Is what the Fed doing manipulation?. "


"3. If the Fed says it is deliberately manipulating asset prices then if the answer to  question's 1. & 2. is yes, then I don't get it - isn't what they are doing illegal?."

Because instead of manipulating the market itself, the FED uses intermediaries and shell companies. Then it becomes legal, but not more moral.

"4. My last question is, why is that when banks get caught committing fraud etc that they make a 'settlement' with the SEC?.  How come they can pay a fine and there is no criminal charges?, - clearly there is a counterparty that has been wronged and the law has been broken?.  Isn't a settlement just like a bribe?."

Because banks own the political and judicial system. You'll note that indeed, only banks can escape courts by a settlement.

Thu, 12/02/2010 - 21:51 | 773936 Rogerwilco
Rogerwilco's picture

I remember the last months of 1999 going in to 2000, and this all feels eerily similar. Different players and focus in that bubble, but the same BS from the talking heads and background pumping by the Fed. The markets were surging and all that mattered was momentum. We were in a "new" era where jobs were obsolete and stores would be open 24/7 to handle the flow of commerce. Hell, we even had a Home Depot that actually changed its hours to match Wally World. A few voices warned that the tech craze was likely overdone, but they were dismissed as out of touch with the new reality. Good ol' Alan Greenspan, scared of Y2K, had just dumped over $1T of liquidity into the system and that was like pouring gasoline on a campfire.

It was great until one day in March when it wasn't.

Thu, 12/02/2010 - 21:54 | 773944 QuantTrader
QuantTrader's picture

Give it a rest.  The double dippers got it wrong.  Time to celebrate this market is ripping and the economy will soon follow (wealth effect + obama capitulating on taxes = jobs).  To add the ISM "missed" to your litany of issues is absurd.  It was off by 2 tenths of a % but at a level associated with 5% GDP growth historically.

You can harp on for the sake of the readership but I'll take the 20 G's my PA was up today.

Thu, 12/02/2010 - 22:09 | 773985 No Mas
No Mas's picture


Rosie is articulate and convincing, but he is wrong.  If we see a sub 50 print within the next five years, I will cease to post on this board.

But just like a $10 loaf of bread (as called here on 11/4/2010), it ain't gonna' happen.

Fri, 12/03/2010 - 01:10 | 774327 SheepDog-One
SheepDog-One's picture

SURE you guys! All IS well! As long as 0% interest rates is the new nirmal forever, and Ben can continue monetizing $30 billion weekly pumping markets, beside the extra $9 trillion to banks under the table! Yea its all good! As long as a total fantasy world can be continued indefinitely!

Thu, 12/02/2010 - 22:13 | 773991 Rogerwilco
Rogerwilco's picture


Optimism is good, so tell us an optimistic story. Explain how the Fed unwinds its balance sheet and how interest rates go back to levels "associated with 5% GDP growth", without blowing the whole goddamned banking system to pieces.

Thu, 12/02/2010 - 22:31 | 774008 Spalding_Smailes
Spalding_Smailes's picture

..."The Federal Reserve has started talks with bond dealers about withdrawing the unprecedented amount of cash injected into the financial system the last two years, according to people with knowledge of the discussions.

Central bank officials are discussing plans to use so-called reverse repurchase agreements to drain some of the $1 trillion they pumped into the economy, said the people, who declined to be identified because the talks are private. That's where the Fed sells securities to its 18 primary dealers for a specific period, temporarily decreasing the amount of money available in the banking system.

There's no sense that policy makers intend to withdraw funds anytime soon, said the people. The central bank's challenge is to decrease the cash without stunting the economy's recovery and before it sparks inflation. Fed Chairman Ben S. Bernanke said in a July Wall Street Journal opinion article that reverse repos are one tool to accomplish that goal without raising interest rates.

"One thing the Fed has to figure out is if they can launch pilot programs without spooking the market and creating the perception that they are about to tighten," said Louis Crandall, chief economist at Wrightson ICAP LLC, a Jersey City, New Jersey-based research firm that specializes in government finance. "They are discussing things like accounting issues, and updating the governing documents to the volume of reverse repos the dealer community could absorb."...Bloomberg ~

Thu, 12/02/2010 - 22:40 | 774043 Spalding_Smailes
Spalding_Smailes's picture


Uncle Ben ~


....." the Federal Reserve could drain bank reserves and reduce the excess liquidity at other institutions by arranging large-scale reverse repurchase agreements with financial market participants, including banks, government-sponsored enterprises and other institutions. Reverse repurchase agreements involve the sale by the Fed of securities from its portfolio with an agreement to buy the securities back at a slightly higher price at a later date."....



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