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TranceAddict Investors Club @ Marketocracy (pg. 92)
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| Capitalizt |
This dollar rally is a blip on a looooooong downwards slope...like a skier hitting a pebble.. ;)
And I believe the market rally of the past few weeks has been largely driven by short covering. There is no conviction behind it..no solid reason to be bullish. The real estate drain is still seeping through the economy, import prices soared up 20% last month, gasoline is still $3.50+, the national debt is $9.6 trillion, we are gonna have big tax hikes for investors and corporations next year if Obama wins, and the Bush tax cuts are going to expire regardless of who wins because the dems have both houses of congress.
Real estate bust + worldwide inflation + higher taxes + higher national debt = Not good for the dollar or the stock market. |
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| Krypton |
| quote: | Originally posted by Capitalizt
This dollar rally is a blip on a looooooong downwards slope...like a skier hitting a pebble.. ;)
And I believe the market rally of the past few weeks has been largely driven by short covering. There is no conviction behind it..no solid reason to be bullish. The real estate drain is still seeping through the economy, import prices soared up 20% last month, gasoline is still $3.50+, the national debt is $9.6 trillion, we are gonna have big tax hikes for investors and corporations next year if Obama wins, and the Bush tax cuts are going to expire regardless of who wins because the dems have both houses of congress.
Real estate bust + worldwide inflation + higher taxes + higher national debt = Not good for the dollar or the stock market. |
Our economy is doing bad, but so too is the Eurozone, Asia, and emerging markets. This is a worldwide economic slowdown. This slowdown hit the US first, now that the US has fallen close to or at a support level, now the EuroZone, and Asia are where the USA was 3-6 months ago, which means a dollar rise against the euro, yen, and other currencies.
Commodities are unwinding, gold/silver included. Gold does not trade only as a hedge against the dollar. It trades also as a commodity. You sum up the rise of the dollar against the euro and other currencies, plus, the unwinding of the commodities speculation, means gold/silver will be falling for the foreseeable future.
Remember cap, the USA isn't the only fiat currency economy. Yes, inflation slowly eats away at the dollar, but it does to the Euro, yen, and every other fiat currency. |
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| Capitalizt |
Gold isn't just a commodity krypt, and it's not just a hedge against the dollar. It's a hedge against all forms of government stupidity.. It's a bet against the idea of centralized power. That's why it kicks ass :wtf:
The dollar may rise against other paper currencies...but all paper currencies including the dollar will fall vs gold in my opinion. Inflation is everywhere today...It is baked into the global fiat money system. We can't stop it. Central banks around the world will never stop inflating, so gold will never stop going up in terms of the paper price.
Even if you have a hunch gold will keep going down, it's a good idea to have a fraction of your portfolio in it anyway for diversification. It's a good form of insurance and tends to balance out the volatility of an all-stock portfolio. Look at companies like SA, AEM, SSRI, SLW. The number of ounces they have in the ground per share gives them good exposure to rising precious metal prices. And if you prefer to keep it simple, buy GLD and SLV. Each share is backed by the physical metal. I'm tellin ya krypt, if we get another dip, sell your nvda and take advantage. |
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| Shakka |
| quote: | Originally posted by Krypton
Not with the dollar going higher and a stock bull market. |
While it's possible you could be right, I think it's a bit quick to be calling a stock bull market at this point. What is the new bull market leadership comprised of? |
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| mndeg |
definitely a bear market, the higher highs and higher lows won't be able to hold and we'll probably see a huge red candle soonish.
plus bearish divergence on the S&P 500.
financials are lagging the market and will likely pull the market down upon further unrevealing of bad news.
this rally is all fed and lower gas prices. |
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| Shakka |
| quote: | Originally posted by mndeg
definitely a bear market, the higher highs and higher lows won't be able to hold and we'll probably see a huge red candle soonish.
plus bearish divergence on the S&P 500.
financials are lagging the market and will likely pull the market down upon further unrevealing of bad news.
this rally is all fed and lower gas prices. |
I think you're probably right. The problem with these bear market rallies is that they go up, and go up violently until they hit some key technical level and they fizzle out. I mean the economic data has gotten worse, the housing situation is not better than it was. We have a heavily interventionist government and a witch hunt against short sellers among other things. Yeah, oil is coming down, but it's coming down because of a major global slowdown. Deleveraging of our massive credit bubble will take years, not months to work itself out. We've been in a secular bear market since 2000 with a couple of cyclical bull markets inside. The market will figure it out eventually (I think), but unfortunately the market likes to inflict the most pain on the most people possible. Bear markets are ugly and are not easy to make money in. Patience... |
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| jerZ07002 |
| quote: | Originally posted by Capitalizt
Inflation is everywhere today...It is baked into the global fiat money system. We can't stop it. Central banks around the world will never stop inflating, so gold will never stop going up in terms of the paper price.
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inflation is inevitable not because it is 'baked into fiat money,' rather it is inevitable because of pricing pressures caused primarily by (i) the limited availability of resources to supply a growing population, and (ii) people's desire to have bigger paychecks. So, unless we find an unlimited supply of everything we need, and people stop being greedy, you will lose purchasing power per dollar every single day. Interest rate changes brought about by central banks affect inflation indirectly through changes in demand caused by the changes. Fiat money is not the cause of inflation.
Inflation would exist even if we used a gold standard because inflation is caused by increasing prices. Gold can't stop increases in prices due to supply and demand, nor can it stop peoples desire to have higher wages. |
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| Capitalizt |
While there would be some price increases under gold, they would be much more closely tied to population growth than anything else. The natural course of things in the developed world is for the price of goods and services to go DOWN as productivity increases year after year. We should be paying record low prices for housing, automobiles, etc since these things take much less effort to produce than they did a few generations ago...but we aren't. Despite the recent correction prices are still near all time highs and it is largely due to monetary inflation. The amount of paper money across the globe has grown much faster than world population or GDP growth, so naturally the value of that money has gone down. This would be ok if wage increases kept up with the devaluation but they haven't. Just today in the US, news on CPI and wages were released that showed prices were up something like .8% and wages up .2%
Inflation > wages = lower standard of living. |
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| Krypton |
| quote: | Originally posted by Capitalizt
Gold isn't just a commodity krypt, and it's not just a hedge against the dollar. It's a hedge against all forms of government stupidity.. It's a bet against the idea of centralized power. That's why it kicks ass :wtf:
The dollar may rise against other paper currencies...but all paper currencies including the dollar will fall vs gold in my opinion. Inflation is everywhere today...It is baked into the global fiat money system. We can't stop it. Central banks around the world will never stop inflating, so gold will never stop going up in terms of the paper price.
Even if you have a hunch gold will keep going down, it's a good idea to have a fraction of your portfolio in it anyway for diversification. It's a good form of insurance and tends to balance out the volatility of an all-stock portfolio. Look at companies like SA, AEM, SSRI, SLW. The number of ounces they have in the ground per share gives them good exposure to rising precious metal prices. And if you prefer to keep it simple, buy GLD and SLV. Each share is backed by the physical metal. I'm tellin ya krypt, if we get another dip, sell your nvda and take advantage. |
I'll always have a hedge of gold/silver. I never said sell it. But I don't think they will touch their highs again in the near future. Demand is unwinding for commodities. NVDA is my intelligent speculation pick. Intelligent in that I've looked that fundamentals and they aren't the top 20 of my stocks. Speculation because I invest in an average stock I think is going up. Usually, I'm in investing the best possible stocks fundamentally, which I don't call speculation.
| quote: | Originally posted by Shakka
While it's possible you could be right, I think it's a bit quick to be calling a stock bull market at this point. What is the new bull market leadership comprised of? |
Technology, Consumer Goods, and Shipping in my opinion. Bull market in 2009. |
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| Shakka |
| quote: | Originally posted by Krypton
Technology, Consumer Goods, and Shipping in my opinion. Bull market in 2009. |
I'm personally holding out for infrastructure. I think once commodities and materials cool off, infrastructure will be able to take over and drive the next market. Just my personal guess though. |
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| Krypton |
NVDA up 12% today. 20% capital gain in just 2 days for me.
I called HANS in June at $35. It fell to the low 20's but bounced back with a vengeance from its low. If I were playing this, I would have waited for a support level and/or averaging this one down, then riding it on its way back up...
| quote: | Originally posted by Krypton
One of my premier picks of June 2008...
HANS - Hansen Natural Corp - $35.02
http://www.hansens.com/
Hansen Natural Corporation (Hansen) develops, markets, sells and distributes alternative beverage category natural sodas, fruit juices and juice drinks, energy drinks and energy sports drinks, fruit juice smoothies and functional drinks, non-carbonated ready-to-drink iced teas, childrenGÇÖs multi-vitamin juice drinks, Junior Juice juices and flavored sparkling beverages under the HansenGÇÖs brand name. It also develops, markets, sells and distributes energy drinks under brand names, such as Monster Energy, Lost Energy, Joker Mad Energy, Unbound Energy and Ace brand names, as well as Rumba brand energy juice. The Company also markets, sells and distributes the Java Monster line of non-carbonated dairy-based coffee drinks, natural sodas, natural sodas with supplements, organic natural sodas, seltzer waters, sports drinks and energy drinks under the Blue Sky brand name. Its fruit juices for toddlers are marketed under the Junior Juice brand name.
INTRINSIC STRENGTH: 83%
GRADE: B
RATING: BUY
INTRINSIC VALUE: $60.40
TAKE-OVER VALUE: $68.83
Great fundamentals such as 58% annual sales growth over the last 5 years. 118% annual profit growth over the last 5 years. Profit margin of 17% when the average for the Dow Jones is 11%. Returns on equity, assets, and capital all exceed 20%. Sales from the last 4 quarters is 764% higher than sales from 5 years ago. They have plenty of cash on the side to do whatever they want with (start dividend or invest in business). Additionally, the stock is greatly undervalued. I think it is worth almost twice the price it is trading for today.
Look at the HANS chart. The price is really close to its low.
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More research on HANS... http://investors.hansens.com/
Based in Corona, California, Hansen Natural Corporation markets and distributes Hansen's® Natural Sodas, Signature Sodas, fruit juice Smoothies, Energy drinks, Energade® energy sports drinks, E20 Energy Water®, multi-vitamin juice drinks in aseptic packaging, Junior Juice® juice, iced teas, lemonades and juice cocktails, apple juice and juice blends, Blue Sky® brand beverages, Monster Energy® brand energy drinks, Java Monster™ brand coffee energy drinks, Lost® Energy™ brand energy drinks, Joker Mad Energy™, Unbound® Energy and Ace™ Energy brand energy drinks, Rumba™ brand energy juice, and Fizzit™ brand powdered drink mixes. For more information visit www.hansens.com and www.monsterenergy.com.
Letter to the Shareholder's ... http://investors.hansens.com/common...s'%20letter.pdf
I highly recommend reading their 2007 Annual Report... CLICK HERE. Start on page 28. |
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| Capitalizt |
| Take your profits on NVDA krypt. I keep up with technology prices and there is a major war going on in the video card market. Prices have been plummeting on all Nvidia cards. I saw an 8800GT-overclocked edition on sale for $110 with no rebates a few days ago...70% below where it was last year. It is quite easy to find a high end video card for $120-130 these days, and these cards are powerful enough to last any gamer a good 3-4 years before upgrading. I doubt Nvidia will be able to keep sales growth on a good pace into 2009. The growth estimates seem wildly optimistic to me. |
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