Rare Photo of Mr. Bilderberg’s Dog, Barbarossa!
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I’ve cut back once again to about a 25% position in my silver and gold positions.   This is merely a precaution, as the clouds looming seem ready to ram us down the throat of an all encompassing Deflationary Fat Man.

I also want to have some cash on hand for anticipated lower prices, especially in the miners.   We’ve been down this road enough times in the past ten years to see some of our favorite names go to “poleaxe pricing” — that state of irrational selling likened to a shareholder being bashed hard enough on his melon that all opposable thumb functions disappear, and share certificates cascade to the floor willy nilly.   We want to be there to pick those newly discarded certificates so as to be better able to offer them back to aforesaid bashees at prices significantly premium to their current ones.

I also added more TZA and SKF yesterday, and — in the spirit of true deflationism — added almost as large a position in the oil double neg, ERY.   I am now pretty massively short, on a dollar basis and on a “relative dollar” basis, especially, as all of these positions are leveraged shorts (either 2x or 3x short ETF’s).

I will likely maintain the SKF as I have been, and leave it largely alone.  With the TZA and ERY I will probably be more opportunistic, trading in and out as warranted. 

Any changes in this philosophy — and I may change radically tomorrow, such is the nature of a volatile bear market — I will communicate immediately, although actual trades will be announced in The PPT first.   I don’t pound the drum on that valuable service enough, but now is a very crucial time to be participating, not only for what the “better than the average bear” traders are saying in there, but for what they are NOT saying as well.

Best to you all.

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Fast Winning a Place in Jake’s Heart

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…And bloody and exhausted.  I just did a lot of driving on some client work and it’s been a rough couple of days. The meetings were far afield and I had to sleep in a Brady Bunch-era Courtyard by Marriott last night. The hotel clark (sic) looked like he could have been the Crypt Keeper’s younger brother, sans the warm and vivacious personality.

What’s more on the way back I passed the time rocking to a zillion 30 year old Sirius satellite tunes (First Wave with the Swedish Eagle) while trying to peruse the various iBC posts of interest on my B’berry. I know, “safe as houses” right?

Not so safe, however, when you come across the post remarking how French population call Le Monsieur “L’Envincible Le Fly.”
I almost rolled into a passing semi after I’d seen that one.

Anyway, my “all day business” today forced me to put a stop on my AGQ position early this morning. To my chagrin, that stop was hit.  Now I’ll never be able to introduce my children and grandchildren to my horde of “double stuff” silver paper.  Ah well, comme ce, comme sa.

I have stops in on other mining positions as well, but only NGD’s was hit today.    Last, I doubled the size of the TZA position I put on last night and added another 2k of Skiffles to my horde.   Both positions were up huge today, as you might imagine.   I wish I could say the same for my remaining benighted silver and gold miners.

Tomorrow I’ll be back in and better able to monitor the situation, but make no mistake, I am increasingly bearish here…  That should be good for a nice counter rally about 11:00 am tomorrow.   Stay tuned,  and don’t hock your hoop earrings and tongue bolts just yet.

Best to you.

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Owsley Brown II, a pillar of the city of Louisville in the truest sense of the word, passed last evening, at age 69.  It was quite sudden and unexpected and most of us who knew him are in shock, as he was a very vigorous and youthful man who was intimately involved with many charitable and cultural organizations throughout the city.

If you know me, you know that I am not overly impressed by those types we referred to at school as “born on third base.”   In the case of Mr. Brown however, I make a significant exception.  We were not close, not even “friends,” but I had enough interaction with the man in social and work situations to note both his grace and his almost anachronistic humility.   He had a smile for everyone, and never seemed out of sorts.

Some of the obituaries already printed (like this one in the Wapo) make mention of his charitable activities, but in truth these reports only scratch the surface.  The man truly embodied the aphorism “to whom much is given, much is expected.”  I believe his generosity will be his lasting legacy in the city.

I excerpt the beginning of the Washington Post obituary below:

Former Brown-Forman CEO Owsley Brown II dies at age of 69 after

brief illness

LOUISVILLE, Ky. — Former Brown-Forman Corp. chairman and CEO Owsley Brown II, who took the company founded by his great-grandfather and spread its reach to liquor stores, bars and restaurants worldwide, died late Monday after a brief illness. He was 69.

Brown’s sudden passing drew an outpouring of reaction from political leaders who praised his business skills and philanthropic spirit.

“Louisville lost a great friend today; he will be missed,” said Sen. Mitch McConnell, R-Ky., who praised Brown’s “pioneering career” and “generous philanthropic efforts.”

Brown oversaw the Louisville-based company’s transformation into a formidable player in spirits markets worldwide. Late in his career, Brown-Forman shed its Lenox fine china and Hartmann luggage divisions to focus on its core beverage business.

Brown-Forman is one of the largest American-owned spirits companies. Its long lineup of brands includes Jack Daniel’s Tennessee Whiskey, Southern Comfort and Finlandia vodka.

“Owsley was a truly remarkable man with a brilliant mind,” said current Brown-Forman CEO Paul Varga. “His combined analytical and creative talents enabled him to be both a visionary and a practical steward of the company’s business.”

In its last full fiscal year, Brown-Forman reported net income of $571.6 million, or $3.90 per share, on revenue of $3.4 billion. The company has nearly 4,000 employees worldwide.

Brown, a Yale graduate who earned a master’s in business administration from Stanford University, served as an intelligence officer in the U.S. Army at the Pentagon, according to a Brown-Forman release.

He began his Brown-Forman career in 1968, continuing a family legacy that began with the company’s founding in 1870.

Brown rose to become the company’s CEO in 1993 and added the title of chairman two years later. During his tenure, Brown-Forman dramatically boosted its international presence and modernized its marketing efforts.

When he took over as CEO, less than one-fourth of Brown-Forman’s net sales came from outside the U.S. By the time he stepped down as chief executive officer in 2005, nearly half of Brown-Forman’s revenues were generated from international markets. That trend has continued, and the company now gets about 55 percent of its total net sales from non-U.S. markets.

Brown retired as company chairman in 2007 and from its board of directors in 2008.

He was also a prominent philanthropist and preservationist known for his support for art, music and environmental protection.

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I have done nothing different with my portfolio today, save that I took out a large TZA insurance policy to augment my SKF-lles position.  I still maintain my already noted position in AGQ and my other small gold and silver positions.  I am still about 40% cash.

I am again traveling this evening and all day tomorrow, but will check in as I may.

Best to you all.

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[youtube:http://www.youtube.com/watch?v=y5MKuJ8ZnJQ&feature=related 450 300]

A Masterpiece, and Highly Recommended

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I was looking at some silver metal statistics this afternoon and came across and old fibonacci chart of the silver commodity ($SILVER).   It looked to be running into a relatively significant Fib line of support at approximately $39.50.  That line should hold, given the overbought conditions of the dollar, but here’s the daily chart:

 

(more…)

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[youtube:http://www.youtube.com/watch?v=X43ZyUGOPyw&feature=related 450 300]

The Greatest New Wave Hit Ever to Prominently Employ an Accordian

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Aside from that fantastic musical interlude, as written, played and sung by musical prodigy Matt Johnson of The The (no, really, that was the band’s name), who later in life went on to shave his head and post semi-lucid conspiracy rants on the internets.  And no, I kid you not– it’s kinda sad actually.   I won’t link his blog, as you’ve seen it all before.

On the trading scene, I’ve got very little to add tonight.   We only need see this dollar issue resolve.  If we are in a bull flag situation, we should quickly spurt above $78.1o on the DX-Y, and then we are “clean” out of all PM’s and miners.  I will continue to keep my Skiffles (SKF) as I believe that will be keeping me somewhat warm throughout the Mort Kondracky Winter.  A break of that $78.10 number on the dollar will actually induce me to store away more Skiffles as I await massive bank death via the whirling blades of European currency demise.

For the love of Ticonderoga pencils under $35/ a piece, please do not get shaken out too early.   I assure you it will be worth the $1 or so move on the dollar index to make sure you are not being head-faked here… again.  Whatever does happen, however, you should not head out to the moors seeking the Werewolf’s curse, or go down to your local discotheque seeking mad mad passionate love from Big Baby Glenn Rice.  Let’s keep things in perspective and ride this puppy together.

Best to you all.

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[youtube:http://www.youtube.com/watch?v=8MA3406YJUg&feature=related 450 300]

What Goes On at Jake’s Desk Whilst He’s Away
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What the hell goes on around here while I’m gone?  I mean, a man takes a couple of days to go on a top secret mission, and the place falls to wrack and ruin.   I come back and my desk is all askew… my papers molested, my fine Cuban cigars gummed and caked with salivatory drool.   What in the bloody blazes has been going on in my absence!?

What’s that?  Random Errand Boys stealing up to my desk and attempting to short the silver lode??   My impulsive young man!  Why not just go bounce on the high-tensile strength trampoline with a fistful of extra-sharpened #2 Ticonderoga Pencils??

Honestly, I just don’t understand the tendency toward self-immolation that pervades this site in my absence.  Why is it some many of you “traders” look to shower yourselves with butane and then engage in “roman candle horseplay” of the most ill-advised variety?   This is not an episode of “Jackass,” this is high-thesis investing!

Don’t you like money?

Why take the high risk trade?  For thrills, a la Beavis, et al?

[youtube:http://www.youtube.com/watch?v=XchwE9zVdnw&feature=related 450 300]

It’s nonsensical, I tell you.  If there’s one thing my compadre Gary Savage and I agree on… it’s this maxim: NEVER SHORT A BULL MARKET!

How many times must I repeat it, and still, like moths to the flame, Icarus to the sun and an Obama Voter to a Trans Fat protest march, you insist on ruining your fragile portfolios by playing with pinless grenades whilst cavorting in a cranberry bog.  And here you come again, your fingerless hand-stumps held out in silent imprecation, blaming me for your troubles.

Well, it’s true, I am here to help.   But you mustn’t be led astray again.  Remember, fading over-confidence in certain sectors of this site is almost as sure a signal as an overbought dollar.   Here’s the latest on that curmudgeonly currency, btw… note how we are advancing into significant zone of resistance on this weekly:

 

Note that I think the dollar can extend all the way back up to that0 $78.10 area, where both the 61.8% golden ratio fibonacci retrace and the rising trend line offer strong resistance.    So don’t be surprised if we pull back a touch more in both the markets and the commodities in the next couple of days as the dollar reaches that resistance level one more time.

After that re-touch, I predict that we will see one final glorious “plungerooni” in the dollar… down to the lows indicated on the above weekly chart.   At this juncture I expect the typical bull here will get drunk on cheap cherry wine and– in the the throes of sock-tongued inebriation– bury his face in the bosom of some local tavern wench.

This, I would contend, would be an ill-usage of your time.   I would rather suggest taking that period to phase out of your remaining long positions including, sadly, your precious metal miners (at least for the nonce), whilst battening down the hatchest with some choice shorts (like the Skiffles).

In the spirit of caution I of course must warn you:  should we break significantly past that $78 dollar index price marking our resistance, all wagers are off, and the window should be closed all the sooner.

My best to you, my Nuttiest of Professors.

 

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