Stocks rally to 5 month highs

[loosecannon]

The value of gold and silver really doesn't change all that much except by demand driven by fear.

Kids when I was a kid a silver dime bought a loaf of bread.

It STILL does given that a silver dime is worth about $3.00.

What really changed?

Not the bread and not the silver dime.

The currency's purchasing power changed.

You can make money investing (or divesting) in gold and silver IF you can intuit the FEAR ZIETGIEST before other investors do.

but gold and silver are excellent hedges against inflation, as your example illustrates. Long term anyway.

 

[Toro]

I think today was a near-term top in gold and silver, and liquidated all my holdings.

However, I think it is just a pullback, and that we'll hit new highs in the future.

If I'm wrong, though, I'll change my mind in a hurry.

 

[JWBooth]

Stocks rally to 5 month highs

Peter Schiff blew a hole in the bottom of this paper boat with this column:

Schiff Responds to Dudley, Fed

One telling quote from the article:

"Although the inflation being created by the Fed may not be showing up immediately in rising rents or auto prices, it is nevertheless pushing up asset prices in other areas. Many commentators are celebrating the "best September for the Dow and S&P in 71 years," rising 7.7% and 8.8% respectively. Well, it was also a pretty great September for soybeans (up 9.5%), rice (up 10%), oil (up 11%), corn (up 12.2%), orange juice (up 13%), cotton (up 17.5%), and sugar (up 19.3%). In fact, the whole CRB is up 8.7%. The Swiss franc is up 4.6%, the euro up 7%, the Aussie dollar up 9%. Gold is at all-time highs, silver at 30-year highs, and copper at 3-year highs.

In other words, the box of Uncle Ben's in my kitchen cabinet had a better month than the Dow Jones Industrials. The same could be said for the boxer shorts in my dresser. Could it be that the Dow isn't rising, but the dollar falling?"

it could be true, but tell that to the folks who say that the Fed hasn't pulled the trigger on QE2 yet. I think they have. Others disagree.

The fed hasn't been right about anything else, why should they be different here?

Inflation hasn't raised its head much anywhere else except the stock market, but how much bailout and other money's sitting in bank vaults are making it into the stock market instead of interest on savings and certificates of deposit? How much of this market run up is institutional investing?

 

[blu]

its amazing what positive things happen when congress goes away

 

[william the wie]

The there is the veto of the foreclosure challenge bill that was not called a veto but rather a request for public hearings prior to passage. I have no idea what effect that will have.

 

[Toro]

The market is going up simply because of government intervention. There is no other reason. The jobs data today was bad, but that's good for the stock market because it increases the odds of a bigger quantitative easing, which means more money for the Fed to buy assets with. Our capital markets have become a joke.

The stimulus affects are fading so the Fed believes it needs to flood the system with oceans of liquidity. They should just let the market clear. Instead they are massively intervening for little good. This will end badly.

 

[loosecannon]

they have been doing this since 2002

But I think in this case they intend to devalue the dollah and give that some teeth by forcing commodities and equities to rise significantly.

The USDA corn report today was a great clue about what is going on behind the scenes.