Ride the Worm, Plebs!

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“Catch the wave and you’re sittin’ on top of the world…”

— Emperor Leto II,  Atreides

Yes, Pop was quite a surfer wasn’t he?   No matter, today’s walk back in nostalgia-land is brought to you by the good dwarves of Moria who remind you “There’s no better time than late August to stuff your goody bag full of shiny robot parts, preferably made out of pure gold and silver.”

As my dear friend and father of the Mentat, Johnz Hopkinz, M. Le Docteur Le Fly likes to say, “To every time there is a season, etcetera, etcetera, Peter Cetera.”

And this hear is the season, young plebs, to stock up on your favourite gold and silver plays.   Today, I banqued mass coinage on AGQ.   I plan to take that trip to at least $70, and moooah.

But the real play here is in the Jacksons of choice — the silver goddess, SLW, its slower little sister, PAAS, and the robust brotherhood of the three middie golds — ANV, EGO and IAG.

If you are of sound mind and body, you might want to spartaculate on even smaller stuff like GSS and BAA and EXK and RBY.   These are all considerations for the coming weeks and months.   Personally I try to own “one of everything” at least.

You never know when you will see extraordinary action out of such crazy outliers like VGZ.   This is why I try to keep an inventory.  If you haven’t the patience of the pocketbook, GDX for the bigs will do, and GDXJ for the smaller names.

Even the execrable TBT seemed to turn today.   I did not add, but then, I’ve got plenty, and I’m happy to support your bid by never selling.  Your welcome.

Be on the alert for my top calls tomorrow and going forward.   The Lord God Emperor has decreed a moratorium on bullsheet currency.   Only true money shall prevail from this point on.

Best to you all.

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Don’t dare ask me about the dollar, small pleb!
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Quickly, quickly now, as the spice melange takes maximum hold…  I shall reveal the revelations of the spice dreams as controlled by special Bene Gesserit training taught exclusively to me by Madonna.

First, I reiterate, with cement-like, no…concrete-like certainty, the devolution of this market will be marked by the application of much spice melange to my upper respiratory tract, especially my nostrils, where it is most tasty and vision-producing.

I envision our dollar to be entering some significant retrace territory on the weekly chart here, and soon, trouble:

As you can see, we are not yet oversold on the weekly (we should not be as we bottomed a mere two weeks back), but we are approaching some significant Fibonacci retrace levels at 61.8% of the latest large drop from the March to December ’09 period.

Not coincidentally, that huge dollar drop brought us our relief market.   Now I think she gets ready to drop once again, as the dollar “recovery” continues to weaken at the firm but effeminate hands of Ben Bernanke.

The dollar daily is even more immediate:

As you will note, on the daily, the Gom Jabbar  lies even closer to the neck of the weakling dollar, as it is overbought already after a mere 11 days since it’s last bottom-scrape.    A mere word will bring it to it’s knees, and I think that word is “Fibonacci.”

Or it could be “black candle,” even though that’s two words, technically.

No matter, gold held fast today, and as I commented to M. Le Docteur earlier today, whenever gold and the dollar rise simultaneously, it usually means one of them is about to break.   Today, the dollar blinked first but recovered.   The rest of the week should tell our tale.

In the meantime, gold and silver miners may continue to consolidate here.  While you are eating that sandwich and waiting for them to break out once again, take a gander at ANDE, the old Jacksonian agricultural stalwart.   I expect MON to recover here with the rest of the ags as well.

May the great red beard and moustaches of Frank Herbert bless you all, and good night!

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Screw Philly, I say.  I know mon ami, Monsieur Le Docteur de Le Fly was at one point contemplating a move to Pennsylvania (aside — I had a brother who matriculated at Villanova who called it “Pennsyltucky” — odd, no?), so I wanted to give him fair warning. 

The tax and spending vortex that is currently sucking the entire state of New York, and more specifically, the grand city of dreams, New York City, down the sewer drain does not contain it’s circling to within the triangular borders of my home state.  No, this is a whirlpool whose edges limn the very borders of Virginia to the south, Quebec to the North and as far as Iowa to the west.  

The whole northeastern and upper midwestern block of the United States is in fiscal trouble brought on by inefficient tax structures, failing demographics, imploding industrial bases and out of control government spending.  Each of these factors are damaging on their own, but taken in concert as they have been these last ten years, they sound a toll of doom for the region. 

The misincentives and ham handedness that have marked this progression are no better illustrated than by the City of Philadelphia (the once great Northeastern city) deciding to assess usage fees on bloggers within their jurisdiction.  What better way to discourage young thinkers and quite possibly entreprenuers than by assessing such a ridiculous lien upon their intellectual output?   What city ever grew by stifling its intellectual corps? 

But this is what these Northeastern and Midwestern cities are slowly but surely doing to their best and brightest, by dint of overtaxing the industrial base, ramping the governmental regulatory juggernaut and making the cost of living insurmountable for those who would seek to start a family in a safe place convenient to their work.  

Great cities are built on capital, both physical and intellectual.   That capital can serve as strong reserve in times like these, but it cannot suffer to be hollowed interminably without eventually realizing great damage upon that city’s historic cultural and economic structures.    We are not such an old country that we have stored the long term capital, many times compounded, of a London, Paris, Rome or Berlin.   Our cultural capitals have not the fuse to survive, should we set alight the same bombs those countries have sparked within their own economies, no matter how much earlier.

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I think we’ll continue to see a bit of a pullback in gold as the dollar makes its last stand here, but nothing to get excited about.  I may throw some more shrimpy calls on the barbie.    I may just eat a sandwich.   My best to you, in either case.

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It’s not been a bad ride for ANV since we last talked about it, has it?  Well, all good things must come to an end… or at least a temporary pause, no?

And I expect that’s what we’ll be coming up on in ANV as early as tomorrow.  I won’t be selling any of my Smaug-horde, but I may very likely sell the calls in the high $21 dollar range.   If you got on board when I alerted you to the 200-day touch you’re up over 35% right now, and I should think that’s not a bad ride for less than a month.

You can see we’re approaching some pretty serious oversold levels here in this recent chart:

I will likely do the same for SLW, EGO and IAG as well, and I will reduce my AGQ levels too.   Some of my smaller positions, like FRG (also a huge winner today) and RBY may get trimmed as well, but most I will just leave to gestate further in the womb of this great gold bull, which I think will resume soon after this pull-back.

BAA — the chronic underperformer, comes to mind as a something about which Mother Mary whispered right in front of me, “Let it Be, son, Let it Be.”

Or maybe that was the Raven quothing “Nevermoooooaah!” 

Whatever.  If you really have the hankerin’ to buy something tomorrow, why not try that perennial Fly favourite and crusher of all things Broadcom — ENTR?   Note, you may recall (and certainly the fine gentlemen and ladies of The PPT know this) that I added to my pile on this the other day at the retest of the original breakout?

Not that there’s anything to all that crazy chart-chompin’ stuff.

Best to you all.

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The growth, it appears, will be in interest rates. 

And before Spring, I should imagine.

I picked up some more TBT today.    Prospective homebuyers may want to think about locking in their rates, should they choose to go the mortgage route.

Gold and silver and many other commodities seem to be indicating we are witnessing yet another inevitable result of the abused dollar.   I think treasuries yields are about to give up the same ghost, no matter what Mr. Bernanke has planned for them…

Forgive me for my peevishness as of late.   I completed a large opus today, the stress from which I am perhaps allowing to leak out from my very pores and upon these pages.  

 Now, I must rest.

My best to you all.

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Got some serendipitous tickets on Friday afternoon, saw it last night.   I’m not a big fan of the whole Broadway show thing, but this was exceptional.   Great story, great tunes, go see it, you’ll agree.

Highly recommended.

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