Alarming

[Girchuck]

As far as I understand, when the rally is fake and synthetic, one need to find safe shorting opportunities quickly.
One idea that comes to mind would be ethanol manufacturers that rose in price much more than average. Ethanol producers depend on government subsidies for their profits. If government goes broke and reduces subsidies, their profits will go down, and if market rally cannot be sustained, they'll be overvalued and lacking momentum.
Does this sound about right?

[SlowStroke]

Where do you run to when the sky is falling?

I appreciate the warnings.

But what would be most helpful now is practical advice.

[mcb]

[ QUOTE ]
Conspriracy theorists are losers.

[/ QUOTE ]
wrong

[duk]

[ QUOTE ]
Where do you run to when the sky is falling?

I appreciate the warnings.

But what would be most helpful now is practical advice.

[/ QUOTE ]

Commodities are already way up, but should do well under high inflation or a weak dollar. Probably a little too risky right now, but I'd be happy to buy more gold on a pullback.

It seems to me that long term interest rates have to rise significantly. There are some inverse bond funds out there that can capitalize on this, but timing is tricky because they lose money unless rates are rising.

Consumer Staples tend not to suffer so much during harsh economic times. If people need stuff, they need stuff.

Those are the things I've been able to come up with. I'd love to hear other suggestions, or comments on these. I don't know much aside from what I read in papers and on the internet.

[Mr. Now]

Sniper aka MrModerator,

Mr.Now requests your insight regarding Later, please elaborate ... as soon as you are willing, and you have the time.

I look forward now, to reading your analysis on Later.


Thanks!

[cdxx]

[ QUOTE ]
As far as I understand, when the rally is fake and synthetic, one need to find safe shorting opportunities quickly.
One idea that comes to mind would be ethanol manufacturers that rose in price much more than average. Ethanol producers depend on government subsidies for their profits. If government goes broke and reduces subsidies, their profits will go down, and if market rally cannot be sustained, they'll be overvalued and lacking momentum.
Does this sound about right?

[/ QUOTE ]

i agree that you should find safe shorting opportunities, but it may be unsafe to bet against ethanol, just like it may be unsafe to bet against oil and natural gas.

it may appear that the rally in this sector is temporary, but pretty much the whole energy industry is very much tied to policy and the government. that's how they get their business, lower their costs, and improve margins. it is unsafe to bet against this particular government business, unless you are willing to outlast a presidency, a military conflict, or let's say the lobbying efforts of the whole sector.

[MrBlue]

I sold all my GLD at around 61.7 thinking the it will pull back before I add more. Should've put a trailing stop instead. Live and learn.

Anyway, my question is this: In the case of a severe downturn in the economy and people need to start selling gold to raise cash, wouldn't it put downward pressure on the price of gold?

[Girchuck]

Who has gold?
Probably not the people hurt by economic downturn

[Mr. Now]

ahnuld ,

Thank you for your post. The purpose of my post is to focus attention on related market, economic and political behavior occurring now.

For example, precious metals typically move inversely to stocks. When both move in the same direction, it's time to pay attention to that divergence. Etc.

We are winning poker players and we notice when the "story" represented does not match actual facts. We actually get paid for developing and using this specific skill.

The intention of my post is to call attention to the market items that do not add up, such as what appear to be very misleading statements from the Fed in the face of obvious and intentional Fed-driven monetary inflation.

Do all readers believe the Fed can be trusted?

Search my posts on 'inflation' to examine my previous thoughts. Note the dates.

If you buy what is said in these posts, the next step is to learn about monetary inflations through economic history and ask yourself if we might be in the early stages of a hyperinflation.

There is no need to provide specific advice per se. In general, providing such advice is problematic to both the giver and the taker. Instead of taking advice, it is much better to come to your own conclusions. This way, you have the strength of your convictions when you back your opinion with money.


Again, the purpose of my post is to focus attention and generate discussion. Accordingly, it is not essential for me to lead that discussion, or to provide specific advice. If the post brings inflation and the likely actual motives of the Fed to attention, the post works.

Some folks think rising prices is inflation. That is false. Rising prices are a SYMPTOM of inflation, which is an increase of money in circulation.

The Fed directly controls the quantity of money in circulation.

Thomas Jefferson's Warning To America : "I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." Written by Jefferson in a letter to the Secretary of the Treasury Albert Gallatin (1802).

Inflation Definitions-- Only #8 is correct.
http://www.google.com/search?client=fire...G=Google+Search

[sprmario]

So, question... given your assumptions, what's the proper course of action. You seem a bit ambiguous as to what to actually do.