I smell a bounce. Covered my shorts.

Numerous sites talking that the Dow Futures are down 200 points for the am. If that holds another bad day if the credit default swaps go sour.
 
dwdollar said:
What's your thoughts about next week llepard?
Click to expand...

The system is broken. It cannot be fixed. The government cannot stop this contagious loss of confidence.

At some point it will bounce. I do not know when.

All bounces will ultimately be retraced and lower lows will be made.

Big picture: we are in a monster BEAR market. Do not be a hero. Get in cash and gold. Playing the long side of stocks is a risky game. Playing a bounce requires one to be nimble. I tried on Thur. Fri. and got my head handed to me.

It is too risky to be long anything except Gold.

It is also risky to establish new shorts because any bounce could be violent.

THINK. I do not want to make a fortune. I want to protect what I have.

They say in a Bear market he who loses the least wins. That applies here.

I think the intelligent play is gold. I am also lightly short some stocks that I have great conviction about. They could bounce, but I am prepared to ride out any bounce.

My current thesis on next week is further crash on Monday or Tuesday.

That will be a near term bottom. Then a two week rally. Then we go over the cliff again.

I am extremely bearish. The contagion from this liquidation is going to be enormous. We are operating under entirely new rules. Old rules about counter trend rallies may not apply. That is why the long side is too risky.

I am either going to be flat or short. And if I am short I will only be heavily short when it looks like countertrend rallies are fading.

I also continue to aggressively allocate assets to gold and silver.

I think we are going to have a total collapse of the fiat dollar standard. It is rolling from one asset class to the next. I think all paper currencies are doomed.

My bet is that at the bottom of this a gold based currency will emerge. Then things will get better.
 
llepard said:
The system is broken. It cannot be fixed. The government cannot stop this contagious loss of confidence.

At some point it will bounce. I do not know when.

All bounces will ultimately be retraced and lower lows will be made.

Big picture: we are in a monster BEAR market. Do not be a hero. Get in cash and gold. Playing the long side of stocks is a risky game. Playing a bounce requires one to be nimble. I tried on Thur. Fri. and got my head handed to me.

It is too risky to be long anything except Gold.

It is also risky to establish new shorts because any bounce could be violent.

THINK. I do not want to make a fortune. I want to protect what I have.

They say in a Bear market he who loses the least wins. That applies here.

I think the intelligent play is gold. I am also lightly short some stocks that I have great conviction about. They could bounce, but I am prepared to ride out any bounce.

My current thesis on next week is further crash on Monday or Tuesday.

That will be a near term bottom. Then a two week rally. Then we go over the cliff again.

I am extremely bearish. The contagion from this liquidation is going to be enormous. We are operating under entirely new rules. Old rules about counter trend rallies may not apply. That is why the long side is too risky.

I am either going to be flat or short. And if I am short I will only be heavily short when it looks like countertrend rallies are fading.

I also continue to aggressively allocate assets to gold and silver.

I think we are going to have a total collapse of the fiat dollar standard. It is rolling from one asset class to the next. I think all paper currencies are doomed.

My bet is that at the bottom of this a gold based currency will emerge. Then things will get better.
Click to expand...

Sorry about Thursday and Friday's losses...We were pulling for you. I think this analysis here you've made is dead on though.
 
llepard said:
The system is broken. It cannot be fixed. The government cannot stop this contagious loss of confidence.
Click to expand...

And the government (and the media) caused this loss of confidence! They spread fear and panic to get their precious banker's bailout passed. They started an avalanche of panic, and destroyed the entire stock market in the process. A panic requires a catalyst to get started, and our own government (and media) was that catalyst. Ignorant, selfish fools.

My only concern with gold at the moment (and I am a long time holder), is the effects of deflation. Until hyper-inflation catches up with us (eventually, but may take many years), cash may be better than gold, as gold might fall with everything else. Gold won't go to zero, but it can go down from current levels. But who knows, that's predicting the future...

My advise at this point is to dollar cost average into gold. We may have years to go before hyper-inflation.
 
Brian4Liberty said:
And the government (and the media) caused this loss of confidence! They spread fear and panic to get their precious banker's bailout passed. They started an avalanche of panic, and destroyed the entire stock market in the process. A panic requires a catalyst to get started, and our own government (and media) was that catalyst. Ignorant, selfish fools.

My only concern with gold at the moment (and I am a long time holder), is the effects of deflation. Until hyper-inflation catches up with us (eventually, but may take many years), cash may be better than gold, as gold will might with everything else. Gold won't go to zero, but it can go down from current levels. But who knows, that's predicting the future...

My advise at this point is to dollar cost average into gold. We may have years to go before hyper-inflation.
Click to expand...

What makes you think this? Even the fear mongers are saying gold is going to go up big, 1,500 to 2000, in the next few months. Then you have people like Schiff saying gold will be $5,000 within a year.
 
ItsTime said:
What makes you think this? Even the fear mongers are saying gold is going to go up big, 1,500 to 2000, in the next few months. Then you have people like Schiff saying gold will be $5,000 within a year.
Click to expand...

Nobody knows for sure.

Deflation is deflation. All asset classes fall to a certain extent. Hedge funds, mutual funds and Central banks may sell bullion for a variety of reasons. It's a balancing act. Will there be enough funds going into gold to offset sales? Especially when everyone has lost everything? If you lost all your "gambling" money in the stock market, you don't have any left to put into gold.

I am not selling or jumping out of gold. I wouldn't recommend it. But no one knows for sure when gold will take off.
 
Brian4Liberty said:
My only concern with gold at the moment (and I am a long time holder), is the effects of deflation. Until hyper-inflation catches up with us (eventually, but may take many years), cash may be better than gold, as gold might fall with everything else. Gold won't go to zero, but it can go down from current levels. But who knows, that's predicting the future...
Click to expand...

Yes, that's my concern too.

Excerpted from an article by the Aden sisters...

HYPER-INFLATION OR DEFLATION?

The Fed is spending money at an astronomical rate. It’s creating this money out of thin air by monetizing bad debts and whatever else it has to. Remember, this is on top of all the other ongoing government expenses and it’s extremely inflationary.

Normally, there is a lag of about a year or so between money creation and inflation but eventually, what’s recently happened will result in massive inflation, a much lower U.S. dollar and a soaring gold price. This is inevitable but as our dear friend Chris Weber points out… not necessarily.

The bottom line is this, if the banks start to lend again, then the economy will be on the road to recovery and inflation. But we know the banks are scared and they’re being extremely cautious, for good reason. So if the banks decide not to lend and instead just sit on their cash, then the inflation process will freeze.

In other words, the risk of deflation has greatly increased. Inflation is not a given and much will depend on what the banks do, or don’t do in the period just ahead. The Fed is providing the ammunition but the banks have to use it. If they don’t, the outcome could be much different than what most analysts feel is a done deal.

WHAT TO DO

At this point, it’s best to be prepared for either outcome. That means gold for inflation and cash for deflation, at least until we see how things unfold.

For now, important changes are taking place but that also means challenges and opportunities. This may all end up differently than what we initially thought, but we’ll adapt and keep an open mind. Whatever lies ahead, the current challenge is getting safely from here to there relatively unscathed and we’ll do our best.
Click to expand...
http://www.kitco.com/ind/Aden/aden_oct102008.html
 
Last edited:
Good nose LL. It looks like the market is setting the upside potential to the "batsh*t crazy" setting today.
 
Dow futures up almost 400 right now..insane...

I am still waiting for the updated LIBOR rate data in 3 hours and will be looking at the VIX indicator to get a better grasp on how this markets going to play out today..
 
Mixed reaction on Euro's open..

FTSE 100 4,158.31 -155.49 -3.60%

DAX 4,820.02 +275.71 +6.07%

CAC 40 3,382.93 +206.44 +6.50%
 
Europe up 7%, dow futures 400

Japan got hammered though. is it because they're not bailing out banks?
 
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