[youtube:http://www.youtube.com/watch?v=4TTC6FJphWA 450 300]

“Freedom,”  do you hear, it?

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The above well wishes may be outdated by the time of this posting, as there is a rumour (sic) that Representative Bart Stupak, one of the last principled Democrats, has succumbed to the bribe disease that has overtaken nearly every member of Congress, may Allah throw them all out on their patoots this coming November.

If that’s so, we’re cooked for long term, as the inevitable government imposed rationing takes hold, and destroys a vital part of our economy in the process.  Say goodbye to the solid, high quality healthcare you’ve enjoyed for so long, it’s about to be controlled by Health and Human Services.

And don’t get me wrong, there’s nothing wrong with rationing — it’s a natural economic process that occurs in all supply and demand-based transactions.   It happens in our interaction with health care service providers the same way it occurs in our other daily decisions.   Problem is, at this point in history the more natural flow of free market supply and demand that reflects efficient rationing in pricing has already been cast askew by government intervention in our health care system.  This has resulted in a limiting of service supply that has greatly overtaxed our provider community.

Unfortunately, the new top down mandates of Obamacare will only exacerbate that situation, as additional “insurance” recipients are added to the rolls, with no attendant increase in service providers or pricing (at least according to the Obamacare mandates).    This will result in exit by providers and service workers, a natural result of price fixing that we’ve seen exhibited in every situation where it’s been attemped.  

If you take anything away from this piece, remember that “price fixing leads to shortages,”  as sure as extended drought leads to famine.   (Banque coin on it via The PPT.)

Trying to talk around such natural phenomenon is like arguing with a rock falling to the ground that he is being “bourgeoise” and “oppressive.”    In fact, it’s been a long time curiousity of mine why people would believe that natural economic processes that have been proven time and again over our recorded history, can somehow be evaded by the “right amount of state conviction.”   Marxism did not work for lack of trying, after all.

For those of you who understand rational market actions, there is some faint hope, however.

First, this bill may fall apart under the weight of judicial scrutiny, given the myriad bribes and singular giveaways that have been stuffed into it.   Second, the way this bill is looking to be semi-passed, via the “deeming” process Representative Slaughter has propose, may very well not stand Constitutional challenge.

Third, and probably most likely, the passing of this bill may well usher in a sea-change away from our current Big Government political trends.  Enough economically sapped and pissed off citizens have awoken to this hijacking of our Constitutional precepts that we may see a large scale revamping of Congress that renders President Obama the lamest of ducks, sends the far left Madame Pelosi back to the rear bench, and Harry Reid home for extended fishing in Lake Tahoe (with Fredo?). 

If that in fact does happens, I look for a renaissance in the markets, much like we experienced after the 1994 elections, when Gingrich’s Revolution stopped Bill (and Hillary’s) Clinton’s earlier attempt to Alinsky-ize the country toward a permanently government-first economy.     I think we may also see a desparate Dem Congress, seeing the writing on the wall, try to break the massive groundswell against them by throwing bon bons to the economy and markets.   This could set up for an explosive combination come this summer.

Remember that markets are forward rationalizing, however, and that Barack Obama (thus far) has shown himself to be less pliant than Bill Clinton.   It’s very possible the best we can hope for, until 2012, is gridlock.

Given what we’ve withstood in the last year, that may very well be a balm. 

Best to you all, and remember what Brooklyn’s finest said:

 
Update:  “Deem and Pass Option May be Dead” according to WaPo report… I don’t take comfort in this however, if it’s coming from the Dems, as it likely means they have Stupak, and the other nays corralled and can pass it with a regular vote.   I cannot wait to see the chicanery results (ie, “the bribes”) that got this thing done…

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Second Update:   A real hope for the future, Representative Paul Ryan (R, WI), responding to the demagogues:

[youtube:http://www.youtube.com/watch?v=m4qy3bGYii8 450 300]

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(For more information on Cup O’ Joe for a Joe click here.)
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The relationship of gold to the dollar is integral to my Jacksonian thesis, and I think to this overall market as well.  So I think it dispositive with regards to arguments that portray this market reflating on real earnings or anything of any tangible weurth (sic) to take a step back and look at a longer term picture of the gold dollar ratio. 

I bring you that view here with the following weekly chart illustrating the price of gold divided by the weurth (sic) of the U.S. fiat dollar in the form of “$USD.”

Maybe not exactly a textbook “CANSLIM” Whitman-style cup & handle, but given the proximity of the 34-week EMA here, I think we are setting up for a blastoff.

Here’s my other confirmation-biased bias chart that tells me the dollar is about to meet it’s comeuppance.   This is a longer term chart of the dollar alone ($USD again, and as of yesterday’s close) .   Note on this weekly how we are fast approaching two very significant fibonacci lines (50% retrace of the upmove and 38.2% retrace of the down-move) which I think will serve as a hard brake on this dollar exhuberance.

Note again that this is an “end of day” look (thanks to Stockcharts chintziness,  I cannot get you DXY intraday), and that we are already 40% of the way to filling the rest of that circled gap to the combination fib lines.  

Ben has been re-appointed ladies and gentlemen, and there’s a reason for that.   He certainly is not going to let down those 70 or so Senators who backed him in an election year.   The dollar will weaken again, believe it.

Trade accordingly.  I will be sniping for select names in the woods, as per usual.

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10 Reasons Gold Kicks Cawfee’s Ass

1.  Gold is more stimulative.

2.  Nobody ever had a problem with Coach Gold.

3.  Chicks dig gold more.

4. Gold does not need to be vacuum-packed, ever.

5.  One year at Harvard:  45 maple leaf gold coins vs. 8600 bags of cawfee.

6.  Gold is actually the best part of waking up.

7.  Like cawfee, gold can be found in Africa and South America.  Unlike cawfee, gold can also be found in Canada.

8.  If Blackbeard ever buried a chest full of cawfee, do you think he’d bother with a map?

9.  Gold makes for longer lasting wedding rings

10.  Gold in a teeny tiny little cup is much more surprising and delightful.

But it’s not yet time to buy gold in size.   We’ll likely have some rebound from this oversold condition, but I think we’re in for some additional pain before it will be time to back up the truck once again.    Green Mountain Coffee Roasters Inc. [[GMCR]] , however, is another story.

Pay close attention to accumulation and distribution.  After price and volume I find it the most useful indicator of immediate action.

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*Just don’t buy gold right now, unless it’s just for a trade, then go ahead, knock yourself out.

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Dieu bénissent le Fly
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Let me just say that I’m grateful this day for my good friend, Monsieur Le Fly.  

Before tonight’s market discussion, however, let me tell you a brief story, not altogether “out of school.”    This summer, my wife and I dined with Monsieur et Madame Le Fly. 

By dint of fast L.I.R.R train out of Atlantic Beach, we arrived at le restaurant (downtown NYC) first, and were able to have a quick cocktail while we awaited our dinner companions.   Since the restaurant was bayed and glass fronted, and our maitre d’ was kind enough to seat us in front of said bay glass front, I was able to steal a first glance at madame and monsieur even before he first laid eyes upon me.

Therefore I was immediately able to take the measure of his character, and let me tell you why.   No, it was not the solicitous manner in which he comported himself with madame (although that was certainly nice).   Nor was it his clean appearance, or even his upright posture, however positive those fixtures might be.

No, it goes back to something my father taught me as a wee lad, no more than 13 and approaching the narrowing straits of manhood. 

“Jake,” he said, putting his arm around my shoulder in an almost conspiratorial fashion,

 “Always be wary of a man who is better looking than his wife, as  it’s a sign of a weak character.”

Let it be said that it’s further credit to Madame Le Fly that Monsieur is by no means an ugly man.  It is merely that she is le soleil to his la lune — the gender nominatives notwithstanding.

Second hint — La Lune insisted on picking up the tab.   So it goes with my friend, Monsieur Le Fly.

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But let me not soften tonight’s “a la recherche de temps perdu,” etc., with too much overt sentimentality.   Tonight I laud my bon ami for keeping the rubes, stupes and tin pot bangers continuing to chew the gristle of regret and bitter grapes with regard to the most obvious bull market of the millenium.

Heck, maybe even the only bull market of the millenium.  

Please credit him with Svengali-like powers.   Only mon bon ami could so easily have the five figure account guys gamboling and capering with glee today about the ridiculousness of owning gold with these data readily available:

Know that he is doing the Lord’s work for you and your family by casting doubt on the gold-sound money thesis.   This spells “O-P-P-O-R-T-U-N-I-T-Y” for those of you who may have yet to participate.   Thank m’Lord le Fly and thank those who readily take his word with nary a thought toward logical analysis, or even limpid thought.

For they shall be the bearers of your wealth, well into the next decade.   God bless.

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There should be something of a bounce tomorrow, as we fast approach my mentioned $440 level on the $HUI.  We are also quite oversold on gold in the near term.    That said, I don’t think this pullback is over, and may only cover some shorted calls into tomorrow’s sell off.   Be nimble, be quick, etc.

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$1,100 gold is right around the corner and we zoomed over $17 again on the silver to rest currently at $17.22.

As a result, the miners of anything shiny from platinum to tin foil have gone Batman on us and are leaping in grey tights and high-cropped riding boots from roof to roof.

Royal Gold, Inc. [[RGLD]] must absolutley be on your “Grandmother list” and I mean not for your grandmother, but for your grandmotherhood.

You don’t think Social Security is going to keep you in tea cakes and airplane bottle of Chivas, do you?

Also, for your dining pleasure, Fly has engineered a special gold list for The PPT and left it only for those whom I favor. It’s like stumbling into Aladdin’s Treasure Cave without use of magic verse or carpet.

You are that lucky.

You can see everything I mentioned last night launched out of the park today. That’s because Gold — and [[GLD]] has broken out to new highs again, and is on it’s way to $1,250 and then higher still. In addition to RGLD and the Jackson’s you want to get hold of these top Ten Fly Listers also:

Name              Hybrid % Chg              PPT Score/5.0 

1 AUY                 43.21  %                                4.11

2 NXG                    27.36                               4.05

3 EGO                     33.55                                4.02

4 GG                        21.08                               4.02

5 AZK                     32.99                               3.87

6 GOLD                  42.64                               3.78

7 RGLD                 63.64                               3.78

8 ABX                    20.20                               3.63

9 GFI                    50.43                                 3.52

10 NEM                12.75                                 3.45 

Go! 

Be benificent to one another in this day of gloury (sic).

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Jake Pours A Special Treat for the Bears

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You can tell by the twinkle in his eye that old Pat Boone’s having a special day.      And so are tthe loyal Jacksonian JakeGint Brigade.

Gold is now in new all-time high territory @ $1041.70 an ounce, having smashed the former $1,033 ceiling with gusto this morning, as our friend, Mr. Dollar plummets once again to it’s flash-paper grave.  

In the meantime, silver is the purchase of the century as it still lags gold in targetting and achieving it’s old $20+ highs.    Silver is still one-sixtieth the price of gold as well, compared to more historic ratioss of 40:1.

 I’m still targetting a $21.95 price for [[UUP]] , and we may break to new lows from there, thanks to swarthy men wearing bedsheets and mis-treating their camels half-way across the world.

How dare they object to our running off sheets and sheets of green paper with Ben Franklin’s visage on it and exchanging said specie for their greasy petrol?   Don’t they know what attractive wall covering that shade of grey-green can provide?

Not to mention window-treatments.

Not to get all “stuffed-in-the-gut” about how all my dollar defense dragons are tearing ass on this market and making investments in TV-tubes and natty gas service companies look like so much Baltic Avenue rowhouse property (we have Mr. Boone for that purpose  anyway), I’d like to point out some exaggerated gorillas whose armpits you may wish to shave at some point today…

(That means “take some fiat off the table” for the metaphorically challenged)

Silver Wheaton Corp. (USA) [[SLW]] will likely come back to it’s breakout at $13.35 or so.

Hecla Mining Company [[HL]] is a crazy stock and will likely meet stiff resistance at $5.00.

Wait for a break of $21.96  to get back on [[CDE]] , otherwise, it should fill that gap again at $20.41

Silver Standard Resources Inc. (USA) [[SSRI]] has an optimal entry at $21.75, but otherwise it should get held up at $23.25 or so for the near term.

[[PAAS]] is “BTFO,” but will likely return to it’s old high of $24.81 before heading to new pastures.

Golden Star Resources Ltd. (USA) [[GSS]] will be BTFO at $3.71, but is a buy on a pullback to $3.38.

That’s enough free fritatas for now, pikers.   Sign up for The PPT to get the full-fire hose effect of instant portfolio nutrition.

Off to commiserate with mountain dwarves and other horders of glittering treasure piles.

Slante.

 

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