Category: General

Gold: "Taper This"

Posted on by The INO.com Team

The media love to get a hold of buzz words and then give them a spin and a life all their own.  Recent examples were the mainstream media's presentation of 'Operation Twist' – which was simply an official yield curve manipulation designed to sanitize and dampen inflationary signals – as an inflationary operation, and the 'Fiscal Cliff' drama that sent herds of conventional investors to the sidelines* when they should have been contrarian (and bullish) back in Q4, 2012.

Now we have the media on the job tending the 'Taper' herd.  Among the many hyped up implications of 'Taper' according to the media are that it is bearish for gold.  But I would put forth not only a rejection of that assertion but just maybe a call for the opposite; a bullish stance on gold in the face of a Fed being coerced by natural movements in the Treasury bond market to talk 'taper'.

As part of its QE operation, the Fed buys long-term Treasury bonds with newly printed money.  It does so to try to keep interest rates down so that the economic recovery they have promoted does not fold in on itself, wheeze, roll over and die.  They also buy distressed MBS, but this is a story about Treasury bonds. Continue reading "Gold: "Taper This"" →

What The Syrian Crisis Means For Oil Prices

Posted on by admin

By: David Goodboy of Street Authority

For a brief time in 1991, there was no question that I was going to earn a fortune.

By making a few lucky stock and option trades, I had accumulated a modest sum of trading capital in my brokerage account. Knowing that the United States was about to invade Iraq, I had no doubts that the markets would plunge as fears of Iraq's weapons and military capacity reached a fever pitch around the globe.

I decided to short the market with all of my meager funds. Knowing that the U.S. would invade any day, buying put options on the SP 100 index provided the most return for when the market plunged. As fate would have it, my timing on the invasion was dead on -- the U.S. launched the first airstrike the day after I purchased the put options. Continue reading "What The Syrian Crisis Means For Oil Prices" →

Summer Is Over and Larry Summers Is Out Of The Running

Posted on by The INO.com Team

Larry Summers officially fell on his sword over the weekend by removing his name for consideration to be the next Federal Reserve chairman. I'm sure this came as a relief to the White House (they probably orchestrated the move), who has more than enough on their plate right now with Syria and finding more money to fund the government at the end of September. It also sparked a huge overnight fall in the stock market.

So the question is, are we going to see a female dollar? I hope so, I think it could be a nice change to see what a female could do as chairperson of the Fed. I am of course referring to Janet Yellen, who is number two at the Fed. One thing I think about government and politics is that you can be completely incompetent and if you just stay around long enough, you get pushed up the food chain to the top job. The official name for this phenomenon is the Peter Principal. The Peter Principle is a proposition that states that the members of an organization where promotion is based on achievement, success, and merit will eventually be promoted beyond their level of ability. The principle is commonly phrased, "Employees tend to rise to their level of incompetence." Continue reading "Summer Is Over and Larry Summers Is Out Of The Running" →

Gold Chart of The Week

Posted on by The INO.com Team

Each Week Longleaftrading.com will be providing us a chart of the week as analyzed by a member of their team. We hope that you enjoy and learn from this new feature.

Weekly Gold Report (September 16th through September 20th)

Out of the fifty-two weeks each year, this upcoming week is one that I personally look forward to the most. Since the financial crisis several years ago, this week has been a standout year after year. There are several reason for all the hype, which I will share in the next few paragraphs.

First and obviously most important is the fact that the September FOMC Policy Statement is shared on Wednesday afternoon. We will hear about the FED’s decision on Interest Rates and whether or not they plan to taper their Bond Purchase Program (QE) from 85 Billion, or if they feel it is necessary to stay the course. Without having the ability to sit in this important meeting, traders will either begin speculating on the outcome before Wednesday afternoon, or they will keep the proverbial powder dry until after the announcement is made. Either way, I expect steady volume to return to the markets leading up to, and after Wednesdays disclosure. Continue reading "Gold Chart of The Week" →

Fed likely to slow bond buys despite tepid economy

Posted on by The INO.com Team

Hiring is soft. Pay is barely up. Consumers are cautious. Economic growth has yet to pick up.

And yet on Wednesday, the Federal Reserve is expected to take its first step toward reducing the extraordinary stimulus it's supplied to help the U.S. economy rebound from its deepest crisis since the Great Depression.

If it does, the Fed will likely spark a debate: Has the economy strengthened enough to withstand the pullback?

The answer might not be clear for months.

The Fed is meeting this week at a time of deepening uncertainty about who will succeed Chairman Ben Bernanke when his term ends in January. On Sunday, Lawrence Summers, who was considered the leading candidate, withdrew from consideration. Continue reading "Fed likely to slow bond buys despite tepid economy" →