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There’s something symmetric about this year’s number “2012” isn’t there?  February 2nd, 12th, 20th and 22nd and December 2nd, 12th, 20th, and 22nd are going to be kind of cool for numbers geeks looking for auspicious dates upon which to get married or receive ass tattoos, perhaps.   Maybe the Mayans will come through with a nice atmosphere sucking asteroid strike on one of those days as well?   That would be special, no?

Anyway, without much further ado, I will set forth some of my predictions for the next 365 days, should we get all of them…

• The Giants will luck their way into the playoffs thanks to the incompetence of the 2011 NFC East, and because God wants to punish the Ryan Brothers.  They will lose in the first round to the far more deserving Atlanta Flackons (sic).
• Jerry Jones will publicly admonish, but keep his Ginger Head Coach, Jason Garrett.
• Rick Santorum will come in second to Mitt Romney in the Iowa Caucuses, and then gain enough momentum to place a distant second to Romney in New Hampshire.
• Santorum wins in a tight race in South Carolina, prompting Romney to offer him the Veep slot two months prior to the convention in order to lock down the wary evangelical vote.
• Tim Pawlenty’s head explodes simultaneous with Pat Robertson’s.  Pawlenty for “woulda shoulda coulda”  because he dropped out too early,  and Robertson upon realizing the GOP is running a Mormon-Catholic ticket.
• The New Orleans Saints win the Superbowl over the New England Patriots in Indianapolis.
• Indianapolis (Colts) take Andrew Luck with the first round pick and keep Peyton Manning… for now.
• The U.S. dollar peaks at $81.50 on the DX-Y Index, and proceeds to break down below the April ’08 lows (sub- $72.00) by September.
• Gold breaks $2,000.00 by April, followed by Silver breaking its old highs in May.
• With the drop in the dollar, and the prospect of the end of the Obama Error, the market goes dipschit, peaking at 14,000 in the Dow and 1700 on the S&P before everyone realizes we’re running on fumes, and we sell off after the 2012 elections.
• The 2012 Presidential Election if one of the nastiest on record.  Obama drops his class warfare rhetoric as a losing strategy and takes on the First Victim status.  David Axelrod wheels out mystery women on Mitt Romney and the Veep candidate (presumably, Santorum).
• Sarah Palin is a lighting rod, playing the black hat for the GOP, pointing out every government takeover and socialist move passed over the last five years (including the last two years of the Bush Administration).  Obamacare will become a millstone on the President’s neck as more unintended consequences arise, and the forced coverage purchase laws are declared un-Constitutional.
• The Euro stays a viable currency, but Greece, Spain and Portugal drop out of the union.   Italy’s and Ireland’s banking system are saved by British and German investors and stays in the European Union with new manacles.
• President Obama becomes increasingly disassociated with his re-election and by the time he loses to Romney in November, he will have convinced himself — and his true believers — that he will be a more effective member of the Democrat party out of office.

• Romney’s acceptance speech will be affable and conciliatory, hoping to mend the divisiveness of the past six years.  Neither the Tea Party nor the Hard Left will be very happy about the results
• Besides UPS, my best picks of the year will be COP, MON, AG, RGLD, DE and PBR.

And now, the kickoff!   Happy New Year and Geauuuuux Giants!

 

 

 

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Feed Me! Nom! Nom! Nom!

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Again, my friends, I must apologize for my scarceness on these pages.  I know there are times when many of you may plead for my acquittal from this site, as there are times (due to my acute boredom and incipient ADD) I am here commenting like an Algonquin Round Table wag at the height of the Flapper Era.  You must get sick of that.

But if December is always a rough month in my business, then the last week of December is often the grande chancre (sic) beyond all imaginings.   It’s been ever thus, and it doesn’t matter if I take the week off from work or not (and I do, in the grand tradition of my own bosses past, thereby leveraging my subordinates and allowing me some time with the family), as the former “filter” I thought I had constructed has fallen, by steps, to the technological immediacy of first voicemail, then e-mail, and finally (shudder) Skype.  And to think, this is not even a “capital gains lock-in” year.  Oy.

To make matter worse, this has also been the traditional week when Mrs. Gint gets together with her Wyrd Sisters and our aggregate families (10 children in all) here in town.  So between entertaining between 18-20 people (depending on when grandparents and great aunts/uncles/cousins arrive) a day/night, and juggling three live deals and one dying one via electronic media, I end up neglecting you, dear reader.  Again, I beg your pardon.

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For those of you who were thinking that “The Stock of 2012” would be of the “precious” bent, well, good for you.  Valuations are at 52 week minimums about now for most of my favourites and if you are a loyal subscriber to The PPT, you know that most are also reading “oversold!” in a big way as well.

(Aside: You are crazy if you are not taking advantage of this end of year special for The PPT, as the overall market hybrid alone has been knocking the cover off the ball for those using the patented “Fly Step-in Methodology” for entrance and exit).

Well, yes, this is a good time to be accumulating SLW, EXK and AG, and GDXJ for the new year, if only for an oversold bounce (if you are feeling chicken).

But this year’s Pick of the Year is going to be something  you can put away for a longer to near terminal hold.  It’s the tightest ship in the shipping bidness (sic)– United Parcel Service (UPS).  I am biased, as I’m a long time holder of this King of the Transports (and the $TRAN weekly is looking very smart here, btw), but I think that 2012 may be the year that UPS finally “breaks through.”

Fundamentals are not my bag, so I won’t belabor them, but it is important to note that UPS is the market leader in package transport, with over 15 million pieces moved a year (over double that of rival FDX).  What’s more, despite its unionized work force (Teamsters and Independent Pilots Union), UPS manages to eke out considerably better margins (about 350 basis points better) than the flashy FedEx purple people, most likely due to its entrenched market presence and it’s flexibility in trucking delivery (for example, UPS delivers 1-day, 2-day and regular business deliveries all from the same vehicle route, while FedEx uses wholly different carriers for the different delivery times).

Of course UPS also offers a fatter dividend.  At 2.80% at current market prices (and I’d like to buy it closer to 3.0% anyway), it is about 220 basis points better than rival FDX.  UPS is a cash cow, with $3.5 billions in free cash to either reinvest in new planes and trucks or to mail back to shareholders.  UPS also uses that cash to buy back shares, which is of course accretive to overall value.

But UPS is also a great hold for the future, as  well.   Any good wife will tell you… the wave of the future is internet delivery of just about everything.  And if you love AMZN, God bless, they are a great company, but by no means impregnable from a barriers to entry standpoint.  Now, how would you like to try to start up a rival package delivery service that will meet up to Amazon’s exacting demands (not to mention your mother in law’s)?

See where I’m going with this?

Last but not least, from a technical standpoint, UPS is again nearing all time highs, which it will eventually have to surmount.   Like one of my better gold picks this year– AUY–, UPS has been attempting to break that “lid” at $75 for while now.   If earl prices remain somewhat accomodating, then I think this may be our year.   Note my weekly, which shows the formation that marks the $TRAN itself… a 13-week/34-week EMA crossover (the weekly “golden cross”) and an attempt at breaking to new highs:

And my daily chart shows where I’d like to enter… at the 20-day EMA, if possible:

 

And that is all for now, boys and girls.  I will be back with some predictions for 2012… I hope before the dawning of that auspicious, and seemingly most pre-benighted year.

Best to you all.

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Get ye some vampire gold!

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Time and time again, I’ve stood here and recounted the reasons why I stay away from the large cap gold miners like AEM, ABX, NEM and even GG (though I do own a little of this one from the Wheaton Gold days).    Sure, these are all fine old girls, but they often end up on the wrong side of an acquisition play which then ends up trashing their stock price in a volatile gold market.

That means these big hulks are generally buyers, for the most part, as their management team has little to do but acquire more assets in order to expand away from relatively diversified and well known properties.  They need new territories, fresh blood, new meat; and the highest percentage way to continue drilling on profitable properties is to acquire them from juniors who have done the sweat work to seek them out.

Well, it seems my lonely EGO has gotten all egotistical on me and wants to be a “playah” like the big boys.  No more holding it’s hand out as trade bait for the majors, Eldorado Gold is officially leaving the middle-market gold mining community in its dust and going gold speculating in Turkey, Greece and Romania.  

Yes, you got that right.   They’re offering $2.5 bn of their own stock in order to buy a company (European Goldfields) that is looking for gold in respectively, the next Islamofascist hot spot, the First Beggar of Europe, and oh yeah, a place known for producing pickpocketing gymnasts with facial hair and night dwelling blood suckers without.

That should work out well, fellahs.   Probably very little nationalization risk you’ve paid for there….

In any case, these M&A purges usually overdo themselves, so my beaten down EGO is probably a good pickup here tomorrow morning after what I expect will be a final washout.   There’s support at $12, but I’m not sure we’ll get that far.  Nevertheless,  I’ll place my bets in that area, hoping to catch a bounce.

Oh, and I think everything else will bounce as well.  Most especially earl and gold.  So tomorrow, if I get my flush, I’m going to throw down for some NUGT and for some ERX.

Don’t worry, my stops will be tight.   I’m not a masochist, after all.

Best to you all.

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Options expiry week always makes for fun times in the already-volatile precious metal markets, and this week was no exception.  In fact, I’m thinking of just posting pictures of Care Bears and soothing contra-alto laden Carpenter’s videos during these weeks in the future.   I think that policy would be much better for our collective gastro-intestinal health.

I guess we should have been even more wary this week, as the POG and it’s idiot sister, the POS, were both due for cycle lows on top of their collective miners’ options’ expiry.    That combination made for some sickening drops this week, and now, I contend, for some very attractive purchase prices.

When was the last time you were able to buy SLW under $30.00?  Howabout ANV under $30??  Oh, sorry, that was yesterday.  You snooze, you lose.  SSRI looks like a nice pinch right now, if you’re looking for a cherry.   EXK and AG in that order, remain the best of the silver surfers, however.

For those wading back in, the ETFs would be the order of the day… I like them in this order — GDXJ, SIL, GDX, and for the brave of heart — NUGT (real small now!).

I made mention earlier in the week that I want to see the price of gold ($GOLD) hold that 34-week EMA.   It will be interesting to see if it does get back there today…as that’s $50 north of current prices at $1642.80.  There is precedence for closing very briefly below there on a weekly basis — way back in April of 2009, when we were just crawling out of the muck.  Could this be a similar situation?   Let’s see how we close today.

Best to you all.

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[youtube:http://www.youtube.com/watch?v=xvz8tg4MVpA&feature=related 450 300] [youtube:http://www.youtube.com/watch?v=n8YCd9-Xtc8&feature=endscreen&NR=1 450 300]

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We talked today, so you know what I was doing this afternoon.  I liked the way the miners and even the silvers hung in there today despite the savage sell-off in the morning at the POG/POS level.  It convinced me to add another 10% or so to my 60% position.   I added SLW, AG, and GDX (two silvers and a gold).

To some extent I’m justifying my “Hang on, Sloopy” act over the last week or so, and I have to admit I was surprised to see that sudden cut below $1600 on the POG today.  However, when I noted that the $HUI was bouncing off long time support even as the price of gold (and silver, yeesh!) was still plummeting, I was pretty sure we were not far from the final washout.  That’s what I’m betting on now and for the remainder of the week.

If tomorrow we see a continued bounce (off of the $500 floor) in $HUI, then I will add more to the above and perhaps go have a sandwich in a park with some homeless people for the next couple of days.

It beats Christmas shopping.

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I mentioned I was going to say a word on that execrable and stupid Henry Blodget piece from the other day, the one in his Business Insider blog extolling this new bizarre left wing theory stating that it’s not entrepreneurs after all who create jobs but the  concept of  “demand.”

Suffice it to say, I’m shocked that such a jejune theory could be promulgated by a guy who at one time was actually hired to analyze stocks for a major Wall Street firm (albeit a guy who has since been banned from ever working on that side of the game forever).

Saying “Demand” causes job growth is a little like saying “oxygen” causes job growth, in the sense that if there were no oxygen, we’d be too busy gasping for air to bother to create jobs.

The whole idea is intentionally denigrating in the tradition of the political Left in that it implies that there is no credit due to entrepreneurs for having an idea, risking capital, and pouring hard work into a new enterprise.  Blodget’s crazy claim is that all those factors don’t matter, because — get this — if there weren’t the cash and the desire (which equal “demand” to him) to buy the product or service, their would be no revenues and therefore, no jobs.

In Blodget’s world, the chickens are slave to the egg!  But is that really the case? That without a consumer “demand” present, we’d have no production economy?  Well let’s go back to a hypothetical pre-history to find out:

On a primitive island, where most sustenance is derived from the indigenous banana trees, people traditionally spend most of their day searching about for banana trees which they can climb and then painstakingly harvest bananas by hand.  Local smart guy Oog rigs a scaffolding platform one day out of bamboo and cane rushes and finds he can harvest four times as many bananas as the typical islander can using the old method.  Oog soon finds he has a surplus of bananas, which he finds he can trade for other foods, clothing and perhaps a concubine or two.

Soon Oog realizes that he can make the scaffolding platforms for other islanders, which he does, in exchange for more trade items, and perhaps a plot of land for a new house.   This distribution leads to a massive increase in productivity on the island, which leaves the other islanders with more time (ah the essential commodity!) to commit to other useful tasks, perhaps in seeking alternate foods (the local javelina look tasty, but they were hard to catch and bananas took less time to harvest).

In the meantime, Oog has hired a couple of young men to help him construct his scaffolds and to develop a sharp new projectile or two to help with the javelina hunting ideas he’s been working on.  He pays them in a portion of the goods he obtains in trade for his invention.  They in turn have excess goods with which to trade their fellow islanders, who now have time to continue developing this micro-economy outside the initial “firm” of Mr. Oog’s.  A cycle of job creation has begun.

Now in the above case, “demand” is nothing more than common sense.  Mr. Oog, through his ingenuity, has devised a time saving device for his fellow islanders, and they quite sensibly recognize the value in “purchasing” an item like that to free up their own lives for other activities.   What they pay for the device is irrelevant, as Mr. Oog can take many forms of specie — from trade goods to service — in exchange for his invention, were it mutually beneficial for him to do so.  Blodgett’s “demand” is a red herring.

In the same way so is his insistence that no one would buy Steve Jobs wonderful iPhone were it not for “demand” from the mindless consumer masses in the form of desire and cash.  But don’t the last three years put the lie to such inanity?  In some of the worst economic times in modern history, iPhones have sold faster than Carl Lewis on crank.   That’s because consumers saw the value in an entrepreneur’s idea, risk and execution– not because they just happened to have a few extra hundred bucks they weren’t using.

To act like an economic system is not one of choices and decisions which lead to rewards and penalties is to perpetrate an invidious lie that would suggest we are all powerless as individuals.   I can imagine only one purpose for promulgating such nonsense, and call me cynical, but it’s a dark one, ending in death and slavery for all but the very few.

Best to you all.

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Lots of nasty things can be found at the bottom….
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This action today spells puke-ville for most, and you are probably hearing it. Just had a conversation with my mentor and he’s hearing it louder than loud from all but his oldest co-investors (he doesn’t even call them “clients” anymore). 

I knew we were approaching the end of a cycle here, and I held on hoping to catch that turn and add some of my cash to the projectile return.  I still hope to do that, but believe me I’m a bit more cautious at this point than I even was last night.  That’s just human nature, and it affects me just as much as it affects every one of you.  

There are some positives to look at for those of you who are grinning and bearing it right now in true Cement Head fashion.  For one, we are fast approaching the 52-week high for the dollar at just over $81 on the index.   It’s highly unlikely we will blast through that range without at least something of a rest.

What’s more, the $HUI is holding (as of this writing) at the $500.00 support level (sorry I can’t post a chart at the moment, but look at the weekly if you have the ability to do so).   Oftentimes the $HUI will signal a turn before the POG will.  

 Last, we still have that 34-week EMA line to think about.  Keep in mind this is options expiration week, and everyone and their mother had long calls for Santa which are now all underwater.  We may even get a swing back long before Friday, but I’m thinking that we will see some of Fly’s rubber band action to get us back above that ($1646.oo) before week’s end. 

Granted that’s almost $100.00 north of here, but you might want to keep in mind how quickly we broke this low. 

In summary, I’m continuing to do nothing with my 60% invested position.  If I were a shorter term trader I may have gone to cash a little quicker.  In this case, however, I’ve got enough “leeway” to withstand some shorter term draw-down while waiting to grab some additional return on a re-ignition.   

Best to you all.

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