Bush sounds Hooverish

Watch the money supply. I remain 95% in T-Bills and 5% in gold and silver mining stocks.

If any of my readers are surprised by this homungus BEAR market I invite you to read a book published last year:
A Demon of Our Own Design: Markets, Hedge Funds, and the Perils of Financial Innovation (Hardcover)
by Richard Bookstaber (Author)

I have been asked what financial analyst do I follow? I use Stockcharts.com extensively. I determine market direction based on Dow Theory. I follow Richard Russell Dow theory Letters, Robert McHugh, Ph.D. Technical Indicators and Dennis Gartman. I use Zacks and Investor's Businsess Daily to confirm buy or sell decisions. I use point and figure charting to confirm market direction. I use oneoption service for specfic option trades. I only trade in my pension profit sharing account 3 or 4 times a year. I have a smaller trading accunt with optionsxpress.com that I use for market speculation. When I am not making money in my trading account why would I want to trade in my retirement account?

My number one financial rule is "No one cares about your money unless you do." I think the greatest financial lie ever given to the general public is the belief that you can't time the markets.

I look for a huge tradeable rally in the broad financial markets to begin in the next several days.












“The fundamental business of the country, that is production and distribution of commodities, is on a sound and prosperous basis.” Herbert Hoover, statement to the press, Oct. 25, 1929

Bush said today that the U.S. "will continue to act to resolve this crisis and restore stability to our markets." Oct, 2008

With the credit problems still plaguing the markets it is not unreasonable to compare our crash to 1929. That crash started out much more quickly and the DOW lost about 46% in only two and a half months. Then there was a partial recovery. We are now into the problem for a year, at that point stocks were still down about about -36%, roughly the same as our -39%. The market bottom arrived in 1932, almost two and three quarter years after the start of the decline, and by that time the markets had lost over 89% of their original value. On the plus side if this is just a run of the mill crash we can expect it to be over with a 40% to 45% total decline.

Huge drop in spot gold. $XAU and Royal Gold P&F charts remain bullish. If the Fed doesn't start to inflate right now we are headed for severe deflation Japanese style. Bernake and Paulson should both resign immediately. Review previous post re money supply--the Fed kept moeny supply far too tight and far too long--now look at the mess we are in!!!