[youtube:http://www.youtube.com/watch?v=1egvmGzhmhg 450 300]

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I’m sitting here in my bunker having given up all hope for the country. Pass the cheeba. Pass the wine. Pass the Ritz crackers. We’ll be here a while, so relax a bit.

I must admit I’m amazed at the resiliency of humanity.  I’m amazed at the tendency for things to right themselves through natural and perhaps quasi-divine processes.  I guess, like physics, economics have laws that cannot be contravened, though perhaps they can be more easily bent for a period.  We can rest assured, however, that like gravity’s effect on a rubber ball bounced off the tarmac, we are assured of a rebound by nature.

One true economic law is you will get what you incentivize, if you will forgive me that vulgar neologism.  When this country was formed it was a haven for the oppressed and those seeking a new start, true.  But it was also an immediate draw for those whose nature tended towards the burlesque, the hustle, and even the long con.  The rule of law was late to the game and sometimes absent, so those who survived even in the great cities of the 18th and 19th centuries did so on wit, courage and often times some manner of guile.  That formative chemistry served us well for almost 150 years and provided us not only with the capital, but the innovative drive to subdue the wilderness and become traders on a scale never before seen in history.  Our frontier justice and hustler’s creed, in a sense, turned a soup of opportunity into a civilization whose standard of living surpassed those of the wealthiest Romans and Turks at the apex of Empire.  All of that success a result of incentivized behavior.

After less than 150 years, we turned to the Age of Statism.   It is no modern age, of course but rather one visited and revisited by mankind numerous times over the course of his recorded history, and now so again in America.  The draw of Statism reflects man’s nature — his desire to consolidate power and impose his will upon the many.  Dressed as chivalry and noblesse oblige prior to the Enlightenment, this will to control comes dressed in similar patronizing robes today — first for your children and later ensuring your eternal childhood.

 

The statist door, cracked by Wilson, thrown open by FDR and later Johnson and Nixon, is now blown off it’s hinges by Obama and his club of cronies.  The Constitution, once the citzenry’s protection against such thuggery, now lies in tatters, largely ignored if not openly mocked.  Where our originating culture had once incented hard work and innovation, our new state insinuated the easy out of the dole and the forgiving excuse of eternal victim-hood.  Corruption became not some invasive element to be combatted, but a necessary institutional tool as it has been for centuries in lesser governments the world over.

What lies ahead for us, amidst the foundering bread and circuses, as the microcosms of statist corruption– the Detroits, Chicagos,  and San Bernadinos — silently implode under the weight of their diseconomic burdens?

Are these municipalities harbingers of a greater collective future?

Will the country split?

Or will we reform under a renewed interest in localized solutions and community building?

I can only hope for the latter as  I prepare to cope with an increasingly sclerotic and burdensome, top-down authoritarian system that will be punctuated by misery, increasing poverty and failing infrastructure.  Compound interest can be a terrible thing when arrayed against your interests.  And that interest is coming due, one way or another my friends.

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Ben said he wasn’t going to allay his QE moves today.  “Surprise Suprise!” as Gomer Pyle was wont to say.   Apparently, Ben is prepared to go out with a bang.  Let’s hope it’s smaller than the Big Bang, eh? Concentrate on the high quality stuff for now.  I was buying more AEM, RGLD and SLW today.  Everything else will be increasingly risky, so you may want to just stick with the ETF’s.  If you buy NUGT, make sure you have a call selling plan firmly in place.  Same goes for AGQ.  Best to you all.

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Aw geez, I just had an extremely clever and full of info blog post to make up for my long absence.  In it, I went over the weather conundrum, my summer exploits, the state of our miserable economy as guided by the clown show in Washington, etc. etc.

But like a dumbass, when I went to insert my graphic, I inadvertently went “away” from the site and lost the whole fucking caboose.  Goshdamnitalltohell. Fuck me.

My apologies, I’ll try to summarize.

One, I’ve been buying NUGT for five weeks to various painful degrees of success.

Two, the 120-month exponential moving average on the dollar ($USD for you Stockcharts buds) was breached for the first time in a decade in late 2002, leading to our glorious metals revolution.  Since then, the dollar has bumped but not pierced that line on a monthly basis FOUR TIMES since that initial drop, all of those time led to sad days upon the ascending attempt (the saddest effort ending the first time in February of 2009) and happy, glorious days upon the subsequent failures (remember March 2009 friends?), at least for we PM fans.

Three, the last attempt lasted THREE PLUS MONTHS, from March to June.  We are now enjoying another rapid descent.  If we turn back up again here, on the dollar, I can probably tell you the PM bull is dead.  If not, we are headed to Nirvana once again, sans the blown out brains of the lead singer, etc.

Here’s the thing, don’t buy NUGT tomorrow, as it will probably pull back on a test of $1350.  However, if we breach that level like “butter” with no pullback, be prepared to get aggressive.  In the meantime, we might get a present from SLW‘s “miss” tonight.  AG, EXK and SLW are nascent monsters once again.

All that said, you should also have TBT, as the bonds are beginning their own slow motion train wreck, courtesy of the Bernanke-Obama Hubris Nexus.

Be well.  I appreciate you all.

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I think gold’s flirtation with $1400 is drawing to a close, and we will soon join the great asset swell.  I am thinking about a small “opener” in NUGT.   I’m of the mind we will proceed to $20 with long due haste, where many gaps will be filled, to much rejoicing.

Then we will rest.

The nice thing is that we could get knocked back to $10 before the morning even starts, but that would be an even better launch pad.  Play with stops at the lows.  That is all.

And yes, even the dogs will have their day here soon, but why not start with the more quality stuff? RGLD, SLW and AUY, along with the dividend bearers (NEM and AEM my favorites).

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[youtube:http://www.youtube.com/watch?v=J1jzs6dk4bs 450 300]

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Breaking away for a second to remind you to pay attention here.  We are headed into Santa Claus territory, and I don’t think it will be coincidental when we see the gold and silver elves coming out for their annual drunken bacchanal.

I am hoping that on Friday I will have moved a large amount of money from “here” unto “there,” and then will have some time to sport about with you, old time style, half-inebriated and full of fun.  Until then, GDX, GDXJ, and yes, even NUGT will be attractive in the Christmas season.  On the silver side, those of you who have cursed and gnashed your teeth about EXK can consider this the time to “make your bones,” or whatever other ethnic cliche you’d like to use.   AG is still my favorite silver dog, and SLW and SIL my core recommendations for the noobs.  That said, PAAS and MVG can be berry berry good to those of a speculative bent.

More speculative than any of those, however, is AAU and TC.  If you have 2% of your portfolio that you reserve for dice throwing at 3 AM in a dirty alley laden with crack whores and vein poppers, then those are your available plays.  Do not cry to me if you are blackjacked, but please remit 15% to the Salvation Army if you do bank coin.

Best to all of you, and hoping to spend many days of merry and bright with you in the latter part of this month…

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I sit here and sip my newly distributed Pappy Van Winkle 15-year (rocks, a couple), and reflect on the consequences of today’s market shaking Presidential press conference.  Despite the obsequiousness of the White House Press Corps, some important truths were uncovered, many of them centering around basic math and fundamental civics.

For one thing, the President is either being extremely forgetful, or dishonest about the makeup of our current deficits.  As some of you may recall, Mr. Obama is quite fond of blaming our current fiscal deficit situation on either the “two wars” of Afghanistan and Iraq that he “inherited,” or “the Bush tax cuts” of 2003.  Let’s leave aside the fact that federal revenues have risen considerably—as a result of tax cut driven growth– since the days prior to the Bush tax cuts.  Let us also confirm (by Mr. Obama’s own declaration) that the war in Iraq is “over,” at least for now.  That means that the “causes” Mr.Obama loves to blame for spiraling deficits are, save for a war in Afghanistan that he has escalated according to his own plan (see below), are not really material to the gargantuan deficits we are facing right now.   So what is, then?

Well, some of you may recall the “emergency stimulus” that was signed into law in 2009.  A great bill totaling $831 billion in hand-outs via allocated spending (most of which was distributed to states to keep their own governments running) and “targeted tax cuts” which usually took the form of some sort of credit for jumping through some gov’t preferred hoop.

Any “stimulus” spending is arguably a problem because it’s top-down gov’t allocated spending, considered mostly “one size fits all” for the citizenry, and by that standard alone grossly inefficient.   The even greater problem with regard to such programs is that they raise the baseline spending in these categories permanently, unless specific cuts are made in those areas where spending was increased that first time.   This is what is causing our budget deficits to balloon far past what we had seen in the allegedly horrible “Bush Years.”

 

 

 

 

 

 

 

 

 

 

 

 

As you can see, the problem clearly is not revenue, and it’s not even overseas spending (although Mr. Obama has seen fit to increase that spending too).   The problem is domestic levels of spending that show few signs of abatement any time soon.

Today, the President suggested that an additional $1.6 trillion dollars in tax increases – levied wholly on the heads of the investing and producing citizens of the economy  (otherwise known as “the evil rich”) – will help solve this crisis.   But even allowing the Bush tax cuts to lapse will only produce another $75 billion a year.  How is that going to help attack the deficit?  Answer, it won’t at all, and what ’s more will likely become counterproductive as capital hides in inefficient and economically non-beneficial havens.

Fly’s tax attorney and others like him will be grinning wolfishly if this benighted “plan” comes to fruition, but only those spinners’ children will eat better, while the rest of us will have to contend with cold salt pork and beans as we continue to endure The Obama Winter.

The only answer is restructuring my friends, and that will entail some significant spending reductions and – yes! – entitlement reform.  Barack Obama still has an opportunity here to salvage his legacy.  If he can play “Nixon Goes To China” and pull off the hard work of entitlement reform, he will be forever after revered as a Sainted President.   If he’d rather continue down the path to perdition and Obamacare folly, well….

Many Bollinger Band Crash Trades were triggered in the PM segments this afternoon, and I believe I may partake in some rebound shooters (perhaps in GDX and GDXJ) to reap the reflexive bounce back due those names.  I think SLW and SIL are also prime candidates and if I see a “wash and bounce” tomorrow, I may even grab some NUGT and or AGQ.   We should be very close to done with this pain, however, so hang on at least, even if you don’t feel like trading.

Best to you all

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I guess my jaw is just going to drop every day right into November 6th  of this year.  Yesterday, I stood agog as the U.S. National  Media did not merely let slip their masques of “Objectivity” but tore them off completely in defense of their Dear Leader, The Obama.  It was like we were back in the days of “Soviet Union,” when Pravda and Tass would not only mouth whatever “truths” the Soviet leadership would set them to, but also pro-actively attack dissidents of the regime in order to discredit them. 

When our embassies in Egypt and Libya were attacked “coincidentally” on 9/11, and our Executive Branch Administration decided to respond with an apology instead of condemnation, I guess I wasn’t completely shocked when the MSM house organs (NY Times, Boston Globe, LA Times) buried the story well into their papers to clear room for important Romney/Ryan high school reportage.  What was a shock, however, was watching the press go after Mitt Romney for — very appropriately, IMHO — condemning the wrong-headedness not only of the rioting Islamacists, but of the Obama Administration that was feeling their pain.  Incredulously, I watched as the biggest media firms  in the country went after Romney in a (now confirmed) coordinated attack like he was the guy who murdered our ambassador in Libya instead of being the only Presidential candidate to take time out of his day to remark upon it.

No, what was important to the press was that Romney was condemning the Obama Administration, and everyone knows that the Main Stream Media’s number one job is to advocate for the Democrat President, right?

Right?

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Meanwhile, on day four of “Jaw Dropper Week,” we hear from yet another  uncompensated (well, sorta) member of the Committee Re-elect the President Again (CREEPA) — Mr. Ben Bernanke.   Not two weeks after Mitt Romney all but said that Fed Chair Bernanke was likely selling pencils come this January, the Bearded Bandit decided to show just how far he’d go to keep his job.

In a scene that seemed cut from the classic Mike Judge movie, Idiocracy, Mr. Chairman has decided to cut loose with your sovereign currency in such a way that soon we will be purchasing extra-wide checks to accomodate the extra zeroes we’ll have to write.  And he’s not doing it in any kind of secretive “QE4” way, either.  No, he’s just going to purchase — with fake money! — US mortgage bonds, at $85 billion a month til the end of the year, and then $40 bn a month, apparently until morale improves!

It’s fucking mind-boggling, if you’ll excuse my French.  Just stutteringly mad.

We are spitting in the face of people who hold our dollars world wide.  We are saying, “See this? This hundred dollar bill?  I wipe my arse with it!  Have some!” 

“Oh, yeah… and vote Barry so I can keep my job, eh?  Thanks much.”

Anyone got a line on a wheel barrow factory I can invest in?

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As might be expected, gold (+2.11) and silver (+4.33) are screaming.  More analysis of the traditionals tonight, but the ETFs are your best bet at the moment (GDX, GDXJ, SIL, GLD, SLV, even AGQ and NUGT).  Go nuts, mind as well.

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