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It’s kind of an odd feeling, really. Seeing that I’ve been ranting about the U.S. unfunded liability overhang and its one logical solution, you’d think I’d be out there wagging my finger in peoples’ faces and doing a touchdown dance as our debt is (symbolically and politically, I know) downgraded from “pristine” once again, and the rout of the U.S. dollar is on in earnest.

Instead of taking great joy in $1,700+ gold and $40+ silver I’m seeing tonight, and preparing myself to buy others’ margin calls tomorrow morning, I’m sitting here more than a little bit numb.   This is still my country after all, and it’s still a punch in the gut to see it caught in a debt trap of its own construction.   Yeah, we saw it coming, and that’s why we’ve been building a fortress of gold and silver to shelter us.

But will it be enough?

I honestly don’t know.   For all I know, my miners will get waxed along with the rest of the market (if in fact the market doesn’t just head fake completely tomorrow).   My sturdy ETF’s might malfunction, my options might turn to gruel and even my physical might be tough to transfer if the President decides to go “Full Metal Franklin Delano” on us.    Let’s face it folks, it’s all fine and good to prepare financially, but we are entering into unchartered waters here, and it’s not like we’ve got Horatio Nelson at the wheel, here.

I really didn’t think we’d arrive at this hour this quickly — in 2011.  However, the combination of torpid growth and high unemployment have hit tax collections to such a degree that the current rates of spending have blown a hole in our debt capacity well before we expected in the mid 2000-teens.  There will be painful choices ahead that will make this summer’s kabuki theater play look like the first round of Let’s Make a Deal in comparison.

I don’t doubt they will include tax increases, and likely across the whole bulk of the citizenry.   There are just not enough wealthy people with taxable income around to bring us to any sort of solvency — even with massive cuts to the Federal budget.  No, we’re going to have to go back to the old ways — where everyone contributes at some level, and there are no more free-riders.  If you try to get this done on the back of “him behind that tree,” you will inspire nothing but enmity in the capital providers, which will in turn only drive our economy to darker depths.

I am hoping this shot across our bough will be enough to drive our politicians to a serious assessment of our national dent — both on and off-balance sheet.  If instead this opportunity is squanderd and the pols decide it’s more electorally profitable to scare old people into believing they’ll be left high and dry at the prospect of any reform, God help us all.

In an event, we should have a good day in the gold sector tomorrow.  I will be looking very closely at the action not only on the physical metals themselves (gold, silver, platinum), but also at the $HUI to keep an eye on the miners, and on AUY in particular.  It seemed to take a much lighter hit last week on the pullback, and that may mean it’s getting ready to really take off after that long consolidation.

Good luck to us all.

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We all have a lot of fun on this site with our ongoing theme of pushing wrinkly dissembling bearshitters down open manhole covers, steel fire escapes and empty elevator shafts,, but time in South Florida can really change one’s perspective.

Brothers and sisters, there are fewer more important imperatives for the ongoing health of our civilization than a reverance for our elderly citizens. Think of it — our aged are our only living link with history. Each is a conduit to the past alive and inextinguishable. Those of you lucky enough to still have all four grandparents still with you and sentient (I have none alive) have a veritable treasure trove of personal and historical information unique to your own ancestral past.

Even those of you with living parents (I’m one for two, unfortunately) can still reach back to a period before your birth where those before you confronted the same irascible problems and uncomfortable situations you struggle with every day.

Let’s not be hubristic. There is not brave new world, and the errors and intransigencies of this life have been painted and repainted on the walls of caves and castles many time before this. Why not take the opportunity, while it’s available to us, to plumb the depths of history, even as it stands before us, weathered, mellowed and perhaps past the cheap cynicism that mars the not-yet old.

Reach out — today if you can– and have an elderly friend or relative over for lunch or dinner. Ask them about their youth, and what times were like for them and their family. You will be well compensated for your time and interest, I promise you.
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What do you know? [[SLV]] is kicking Dungeons & Dragons Geek arse in a plummeting-down-the-elevator-shaft fashion. Who’d a thunk it?

Platinum has awoken as well. Dont’ forget about Stillwater Mining Company [[SWC]] , North American Palladium, Ltd. [[PAL]] and [[PTM]] . I share with you my good will, and my winning ways (ahem [[TBT]] ) as I head off into the mists of South Florida, to do “kids stuff & shit.”

Best to you all.
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In or Out?
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The Whale is threatening, its maw dark and deep.
Should you leap?

Truly the Whale can take you places, no? If you can handle the tight accomodations, the rancid air, the weak light, the pulsing, peristaltic movement, that is.

No one said this was going to be easy. Nothing worth accomplishing ever much is.
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I like everything I’ve recounted before here (just page back and note the silver and gold miners, and the Cree, Inc. [[CREE]] I have chosen for my March Madness pick and the Veeco Instruments Inc. [[VECO]] I did not, but own still). Also, don’t forget [[PAL]] and [[PTM]] .

I also like [[TBT]] as long term hold, as Treasuries are doomed. Anyone who tells you different or tries to game a quick-slick-Rick-trade in long bonds via [[TLT]] is merely sticking his tongue in a razor sharp blender whilst daring a two year-old to play “hammer the peg” with his tiny wooden hammer poised over the “Crush/Chop/Puree” buttons.

It’s just a matter of time, imho.

As a bonus, and today, only, I like coal here as well. It’s another commodity that the Chinese love, and God knows, we burn most what we love.

Try Massey Energy Company [[MEE]] here for starters, since Stanley Druckenmiller likes it, and he’s George Soros’s smarter (read “Republican”) partner. I also like Alpha Natural Resources, Inc. [[ANR]] and even the old discredited Jacksonian, Natural Resource Partners LP [[NRP]] — even if only for the fat dividend.

Last, but not least, I think United Parcel Service, Inc. [[UPS]] is getting ready to run again. Since it rules the Transports, I think that means the Trannies will run as well. Dow Theory gives you Paul Harvey’s “rest of the story.” Bad news for Bears.

Again.

Ciao for now.*
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*Extreme apologies for my recent lightness here. It seems that 2010 looks like it’s going to be a pretty damn good M&A year. That’s nice, since 2009 sucked quail eggs… however, it also means I’m going to be running around like a chicken sans chapeau for a bit. Catch you on the high side.

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Sun, Sun, Sun, Here He Comes…
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Today was golden, metaphorically and physically.  Aye, my purse weighs heavy tonight, good sir. They’ll be more to come, but let’s see what today’s action meant for one of favourite picks.  Today, I examine the daily Allied Nevada Gold Corp. [[ANV]] chart for some near term lessons and targets:

What a difference a day makes, no?  One successful thrust and we are up and out of the consolidation zone once again, and ready to make a run at the early January highs ($16.50 area).   We may get a couple of pullbacks from here, but I think we will proceed to that stated goal relatively quickly before pausing to coil again.

Our friend Baby [[HUI]] is also showing signs of robust life, not two weeks after becoming as oversold as that index had been back in the dark days of November ’08.  

Note how the MACD and the slow stochastic are only just turning up on this weekly chart?  It makes one want to touch one’s staggeringly huge bouffant, doesn’t it?

There’s a lot of run left in this move, I think.   Maybe we’ll even shoot past the recent highs of $520 in this cycle.   With the dollar continuing to flag, and the price of gold holding about $1,120 — I have all the confidence in the world.

Back in the here and now, I continue to like all the precious plays I named in yesterday’s post, and I also like the “N” team, NovaGold Resources Inc. (USA) [[NG]] , New Gold Inc. (USA) [[NGD]] and Northgate Minerals Corporation (USA) [[NXG]] .   My top picks continue to be in silver, and especially Silver Wheaton Corp. (USA) [[SLW]] and [[EXK]] .

I also like the action in my two tech favourites (sic) today, Cree, Inc. [[CREE]] and Veeco Instruments Inc. [[VECO]] .   I actually attended a venture capital presentation this afternoon on nanotechnology that blew my socks off.   This new company’s first major customer was Veeco.   I think that may be a sign, I dunno.

On the “other metals” area — the three T’s will be strong with steel ripping.   Don’t forget Thompson Creek Metals Company, Inc. [[TC]] , Teck Cominco Limited (USA) [[TCK]] , and Titanium Metals Corporation [[TIE]] , as well as RTI International Metals, Inc. [[RTI]] , which has moved nicely in the last year or so. 

Finally, I would be remiss if I left off my two platinum blondes [[PAL]] and [[PTM]] .   Buy these and get a year’s subscription to Lady GaGa Magazine.   It won’t disappoint.

Your faithful servant in the Reign of the Sun King,

Jake.

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Canucks Took this German Bunker, Back in the Day
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Yeah, so it increasingly looks like we got head faked on Monday, and the dollar (DXY) is going to make another try at that $80.20 level we talked about last week.  The dollar is up 35 cents as I type this to $79.73, after dropping briefly below $79 earlier this week.  Que sera, sera. 

I will continue adding to [[AGQ]] , as I want to get at least another 600 shares for my “full compliment.”  I will likely add opportunistically to other positions as wel, as I still have a little under 20% of dry powder left to deploy.    The gold stocks seem to be hanging in a little better than my bastard-children silvers, but that’s to be expected.  I am extremely pleased at the results of Royal Gold, Inc. [[RGLD]] today — beating revenue estimates by almost 30% and earnings estimates by over 20%.    That should bode well for my portfolio going forward, even if we do take a bit of a “dollar bite” today.

Again, not so sound like a broken record, but I think it’s very important to concentrate on these key names at these important inflection points — which is where I still firmly believe we have arrived.   On the gold’s, Allied Nevada Gold Corp. [[ANV]] has shown nice strength, as has Northgate Minerals Corporation (USA) [[NXG]] , Exeter Resource Corp. [[XRA]] and Yamana Gold Inc. (USA) [[AUY]] should all be holding in here.   If you can get Royal Gold, Inc. [[RGLD]] in the red today, it is a gift, imho.    All silvers should be bought opportunistically, of course, and I continue to love Silver Wheaton Corp. (USA) [[SLW]] , [[EXK]] and [[PAAS]] here.  Also, you may want to keep an eye on [[PAL]] and [[PTM]] for platinum exposure.

So wear your burlap today for fashion’s sake, and maybe even add a cap fashioned out of old tuna cans for “extra penitant” effect, but be sure to sew extra pockets within your sack so you can sidle into your local gem & coin dealer and slip some cadged Morgan dollars and Canuckistanian Maple Leafs  into them as your youngest son fakes an epileptic seizure in the lobby.

Best to you all, my bunkermates.

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In fact, it may only be around temporarily this morning, but silver has dropped about 1% this morning in early trading (due to a slight uptick in the dollar) while gold has held pretty much flat. That puts our new Gold/Silver ration at a hair over 67.2x , and I So I’m going to take this opportunity to load up on some more select names in bullion [[AGQ]] — and in miners, with [[EXK]] , [[SVM]] , [[CDE]] , [[PAAS]] and yes, even Silver Wheaton Corp. (USA) [[SLW]] again.

I will not be pulling the trigger all at once, as I would like to see if we get more dollar strength in the day, but given the strength of gold in this downdraft, I don’t believe this divergence will hold for very long. Either gold will drop down to a low 60’s POG/POS ratio, or silver will rise. In either case, I think our safer bet will be silver again.

Also, I may dabble in some more [[PTM]] here, which has shown very good relative strength through this whole dollar strenghthening period, as has the platinum/palladium miner [[PAL]] .

Best to you all.

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