The Golden Truth: Not To Belabor The Obvious

Wednesday, March 16, 2011

Not To Belabor The Obvious

But the housing market is crashing again. The MBAA mortgage purchase index tanked hard again after a 1-week bounce from historically low levels. The purchase index is 15% lower than a year ago. Forget the refi index because because refi's do not create new production/growth. So that you don't have to sift thru the well-spun garbage from Bloomberg or CNBC, here's the report from the source: LINK

This mortgage indicator is confirmed by today's release of new housing starts, which fell to its lowest level since April 2009. It's not good that homebuilders and buyers are not ramping up their activity as we go into what should be the seasonally strong period for the housing market. Of course, if I get time to sift thru the next round homebuilder 10Q's, I'm sure I'll find a lot of accounting grey area manipulation that is hiding cash flow problems and bloated inventories. Here's the housing starts article: LINK

The relative activity in the housing market is and has always been considered one of the 3 pillars of major economic activity in this country (the other two being autos and Govt/defense). Even at its apex, technology only produced 10% of the GDP. I am predicting that the housing emporer will prove to have no clothing on and there will be some problems in the banking industry and at FNM/FRE that will precipitate a new round of QE - QE-whatever-they-call-it to try and obsfuscate the truth about what they're really doing - in order to attempt to prop up the mortgage market PLUS continue feeding the ever increasingly voracious spending appetite of Obama's Government.

Greenspan is in the news with a speech in which he blames the current housing woes on the Government. He is partially correct. Here's the LINK But the Truth is that if Greenspan were to abide by the golden truth ("the dude abides"), he would blame himself for 90% of the mess, because he was the "Maestro" who inflated the damn housing bubble in the first place.

I have said since 2002 that Greenspan will hopefully live long enough to see his name go down in infamy once the mainstream media and hoi polloi understand just how catastrophically destructive Greenspan's Fed was to the system (of course, we can debate whether or not he was just following orders from his banking masters, but now here, not now). There are some comments in that above article which suggest that some people are having that epiphany.

Do yourself, and your family a favor, go buy as much gold and silver as you can and make sure you see the "Atlas Shrugged" movie when it opens. Here's a link to pre-purchase tickets: Who's John Galt?

7 comments:

PurewaterWednesday, 16 March, 2011
Dave, Given the massive oversupply of housing relative to demand, I'm surprised you don't think it's beneficial that housing starts are low. Seems to me that will help get the housing market back to equilibrium a little quicker. Of course, reduced housing starts are going to hurt the economy in the short-run just as the housing boom helped the economy in the short-run.
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AnonymousWednesday, 16 March, 2011
The Government shouldn't interfere in the market but the central bankers can?

WTF...Honestly, I think Greenspan can see the irony in his statement. After all he wrote the Gold standard paper in 1968 and how it links to Freedom.
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silvergoldsilverWednesday, 16 March, 2011
just added your link on the front page of my blog, keep it coming!
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AnonymousWednesday, 16 March, 2011
Do you have any energy stocks as well, or do you just favour the PM's? Thanks.
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AnonymousWednesday, 16 March, 2011
Getting ready to go down on a milk bill? 9.3 million ounces is a milk bill when you consider that they sold 520 million.

Thus the total number of silver oz standing in this delivery month is as follows:

4,235,000 oz (served) + 5,110,000 oz (to be served) = 9,345,000 oz

Yesterday we had 9,550,000 oz standing so we lost 205,000 oz to cash settlements or this is a comex reporting error on OI.

Ted Butler reported today that he has never seen greater than 50% of oz of silver to be served vs served this late in the delivery month. He also stated that this has never occurred in any metal or any commodity since the comex officially began. I reported this to you yesterday and I am glad that he affirmed this.
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AnonymousWednesday, 16 March, 2011
If they don't do some POMO today the market will crash according to the CBOE SPX VOLATILITY INDX.
http://www.bloomberg.com/apps/quote?ticker=VIX:IND
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AnonymousSunday, 27 March, 2011
"Priceless Quote From Richard Russell
On Larry Summers: This doofus practically ruined Harvard when he headed it. I can't think of a worse choice to be chief economic advisor. I wouldn't trust Summers to manage a Starbucks franchise."

Starbucks does not franchise. I would buy one if they did.
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Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.