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NOVEMBER ISSUE - 40 PAGES

Integrating Macro Research

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Gordon T Long

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READ ALL THE

"EXTEND & PRETEND" SERIES

 

 

Stage I Comes to an End!

 

A Matter of National Security

 

A Guide to the Road Ahead

 

Confirming the Flash Crash Omen

 

Its either RICO Act or Control Fraud

 

Shifting Risk to the Innocent

 

Uncle Sam, You Sly Devil!

 

Is the US Facing a Cash Crunch?

 

Gaming the US Tax Payer

 

Manufacturing a Minsky Melt-Up

 

Hitting the Maturity Wall

 

An Accounting Driven Market Recovery

FOR UPCOMING SHOW TIMES SEE: COMMENTARY READER 


 

 

 


 

READ ALL THE

"SULTANS OF SWAP"

 

ACT I

Sultans of Swap: Smoking Guns!

 

ACT II

Sultans of Swap: The Sting!

 

ACT III

Sultans of Swap: The Get Away!

 

 

ALSO

SULTANS OF SWAP: Explaining $605 Trillion in Derivatives!

 

SULTANS OF SWAP: Fearing the Gearing!

 

SULTANS OF SWAP: BP Potentially More Devastating then Lehman!

 

SULTANS OF SWAP: Gold Swaps Signal the Roadmap Ahead

 

FOR UPCOMING SHOW TIMES SEE: COMMENTARY READER

 


 

 

 

 

READ ALL THE

"EURO EXPERIMENT" SERIES

 

 

 

EURO EXPERIMENT: German Steel or Schmucks?!

 

 

 

FOR UPCOMING SHOW TIMES SEE: COMMENTARY READER

 

 

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Current Thesis Advisory

62 pages

 

Published November 2009

 

EXTEND & PRETEND

 

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READ ALL THE

"INNOVATION" SERIES

 

Innovate or Die

 

INNOVATION: America has a Structural Problem!

 

INNOVATION: What Made America Great is now Killing Her!

 

America - Innovate or Die!

 

FOR UPCOMING SHOW TIMES SEE: COMMENTARY READER

 


 

 

 

READ ALL THE

"PRESERVE & PROTECT" SERIES

 

 

 

 

FOR UPCOMING SHOW TIMES SEE: COMMENTARY READER

 

 

 

 

 

 

 

 

POSTS:  MONDAY 12-13-10

Last Update: 12/14/2010 08:11 AM

SCHEDULE: 1st Pass: 5:30AM EST, 2nd Pass: 8:00 AM, 3rd Pass 10:30 AM. Last Pass 5:30 PM
ARTICLE SOURCE 1 2 3 4 5 6 7 8 9 10
                       
North Korea Threatens S. Korea With Nuclear War Newsmax                    
Ex-U.S. Intel Chief Foresees S. Korea Military Action Newsmax                    
                       
Is Germany prepared to cave on the biggest issue facing the euro BI X                  
France wants broad debate to push G20 goals - Lagarde Reuters X                  
U.S. Posts $150.4 Billion November Budget Deficit WSJ X                  
                       
Investors bailed out of bonds in November, mostly municipals USAT     X              
SocGen- Actually, The US Government Isn't Issuing Enough Debt BI     X              
Market alarm as US fails to control biggest debt in history Telegraph     X              
Emptying the pork barrel would hit some states especially hard Stateline       X            
A Secretive Banking Elite Rules Trading in Derivatives NY Times           X        
Volcker: Worried about mega-bank failure rules MW           X        
Stiglitz Says Fed Stimulus Poses `Considerable' Risks for Emerging Markets Bloomberg             X      
Is Now The Time To Call The Bottom On The Worst Housing Market In America? BI                 X  
                       
ARTICLE SOURCE 11 12 13 14 15 16 17 18 19 20
                       
The Deluge Of 99ers Begins... Now Calculated Risk   X                
China's Inflation Tops 5%, Adding Pressure for Wen to Raise Interest Rates Bloomberg             X      
Washington Orders Another Free Lunch Schiff                 X  
The Economic Sweet Spot of Presidential Terms NY Times  - Norris                 X  
Kicking the can down the road Economist                 X  
Why Democrats Should Disregard Bill Clinton's Endorsement of Obama's Tax Deal Reich                 X  
                       
CENTRAL BANKING & MONETARY POLICY                      
Fed unlikely to shift from QE2 roll-out FT                    
The Fed and Money Noland                    
The Fed? Ron Paul’s Not a Fan NY Times                    
Ben Bernanke: Juggler of Digits North                    
Defying Critics, Market, FOMC to Stay Course Forsyth                    
How the bond rout shows Bernanke is right Barr                    
Fed Overseer Ron Paul Says He Doubts Bernanke Can Prevent Inflation Surge Bloomberg                    
Why Ron Paul's newfound power both pleases and worries libertarians Slate                    
                       
GENERAL INTEREST                      
Unintended Consequences Mauldin                    
The Nerve to Say No NY Times Morgenson                    
                       
FLASH CRASH                      
MARKET WARNINGS                      
Is Sentiment Flashing A Major Warning Signal Pragmatic Capitalist                    
                       

CURRENCY WARS

                     
                       
MARKET & GOLD MANIPULATION                      
The central banks don't consider it manipulation, they consider it part of their job Chaos Theorien                    
Gold Stocks Still Cheap 2 Zeal                    
The case against gold G&M                    
                       
VIDEO TO WATCH                      
                       

Complete Legend to the Right, Top Items below.
Articles with highlights, graphics and any pertinent analysis found below.

 

 

 

                    LATEST RESEARCH PUBLICATIONS

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COMMENTARY for all articles by Gordon T Long

 

CURRENCY WARS: Debase, Default, Deny!

 

In September 2008 the US came to a fork in the road. The Public Policy decision to not seize the banks, to not place them in bankruptcy court with the government acting as the Debtor-in-Possession (DIP), to not split them up by selling off the assets to successful and solvent entities, set the world on the path to global currency wars.

 

By lowering interest rates and effectively guaranteeing a weak dollar, the US ignited an almost riskless global US$ Carry Trade and triggered an uncontrolled Currency War with the mercantilist, export driven Asian economies. We are now debasing the US dollar with reckless spending and money printing with the policies of Quantitative Easing (QE) I and the expectations of QE II. Both are nothing more than effectively defaulting on our obligations to sound money policy and a “strong US$”. Meanwhile with a straight face we deny that this is our intention.  

 

Though prior to the 2008 financial crisis our largest banks had become casino like speculators with public money lacking in fiduciary responsibility, our elected officials bailed them out. Our leadership placed America and the world unknowingly (knowingly?) on a preordained destructive path because it was politically expedient and the easiest way out of a difficult predicament. By kicking the can down the road our political leadership, like the banks, avoided their fiduciary responsibility. Similar to a parent wanting to be liked and a friend to their children they avoided the difficult discipline that is required at certain critical moments in life. The discipline to make America swallow a needed pill. The discipline to ask Americans to accept a period of intense adjustment. A period that by now would be starting to show signs of success versus the abyss we now find ourselves staring into.  A future that is now massively worse and with potentially fatal pain still to come. READ MORE

   

 

CURRENCY WARS: Misguided Economic Policy

 

The critical issues in America stem from minimally a blatantly ineffective public policy, but overridingly a failed and destructive Economic Policy. These policy errors are directly responsible for the opening salvos of the Currency War clouds now looming overhead.

 

Don’t be fooled for a minute. The issue of Yuan devaluation is a political distraction from the real issue – a failure of US policy leadership. In my opinion the US Fiscal and Monetary policies are misguided. They are wrong! I wrote a 66 page thesis paper entitled “Extend & Pretend” in the fall of 2009 detailing why the proposed Keynesian policy direction was flawed and why it would fail. I additionally authored a full series of articles from January through August in a broadly published series entitled “Extend & Pretend” detailing the predicted failures as they unfolded. Don’t let anyone tell you that what has happened was not fully predictable!

 

Now after the charade of Extend & Pretend has run out of momentum and more money printing is again required through Quantitative Easing (we predicted QE II was inevitable in March), the responsible US politicos have cleverly ignited the markets with QE II money printing euphoria in the run-up to the mid-term elections. Craftily they are taking political camouflage behind an “undervalued Yuan” as the culprit for US problems. Remember, patriotism is the last bastion of scoundres  READ MORE


  BRIEFS  

Obama's 'Hail Mary' Export Strategy
   
     

 READER ROADMAP -  2010 TIPPING POINTS aid to positioning COMMENTARY

1

         

1-SOVEREIGN DEBT

2-EU BANKING CRISIS
3-BOND BUBBLE

4-STATE & LOCAL GOVERNMENT

5-CENTRAL & EASTERN EUROPE
6-BANKING CRISIS II
7-RISK REVERSAL

8-COMMERCIAL REAL ESTATE

9-RESIDENTIAL REAL ESTATE - PHASE II
10-EXPIRATION FINANCIAL CRISIS PROGRAM
11-PENSION CRISIS

12-CHRONIC UNEMPLOYMENT

13-GOVERNMENT BACKSTOP INSUR.
14-CORPORATE BANKRUPTCY

TODAY'S TIPPING POINTS UPDATE

RED ALERT

AMBER ALERT

ACTIVITY

MONITOR

Click to Enlarge





12-13-10

 

GEO-POLITICAL TENSIONS - ISRAEL / KOREA / IRAN

 

 

IRAN

 

ISREAL

 

KOREA

 

North Korea Threatens S. Korea With Nuclear War  Newsmax

 

North Korea warned Monday that U.S.-South Korean cooperation could bring a nuclear war to the region, as the South began artillery drills amid lingering tension nearly three weeks after the North's deadly shelling of a South Korean island.

 

The South's naval live-fire drills are scheduled to run Monday through Friday at 27 sites. The regularly scheduled exercises are getting special attention following a North Korean artillery attack on front-line Yeonpyeong Island that killed two South Korean marines and two civilians.

 

The Nov. 23 artillery barrage, the North's first assault to target a civilian area since the end of the 1950-53 Korean War, began after the North said South Korea first fired artillery toward its territorial waters. South Korea says it fired shells southward, not toward North Korea, as part of routine exercises.

 

North Korea, however, lashed out at Seoul, accusing South Korea of collaborating with the United States and Japan to ratchet up pressure on Pyongyang.

 

That cooperation "is nothing but treachery escalating the tension between the North and the South and bringing the dark clouds of a nuclear war to hang over the Korean peninsula," Pyongyang's main Rodong Sinmun newspaper said in a commentary carried by the North's official Korean Central News Agency.

 

 

Ex-U.S. Intel Chief Foresees S. Korea Military Action  Newsmax

 

The former US intelligence chief warns that South Korea has lost its patience with North Korean provocations and "will be taking military action."

Retired Adm. Dennis Blair, who was national intelligence director until May, said he did not think that hostilities would escalate into a larger war with artillery attacks on Seoul because North Korea knows it would lose.

"So I don't think a war is going to start but I think there is going to be a military confrontation at lower levels rather than simply accepting these, this North Korean aggression, and going and negotiating," he said on CNN's "State of the Union."

 

1- SOVEREIGN DEBT & CREDIT CRISIS

 

SOVEREIGNS

 

 

GREECE

 

SPAIN

 

GERMANY

Is Germany prepared to cave on the biggest issue facing the euro  BI

 

FRANCE

France wants broad debate to push G20 goals - Lagarde Reuters

 

UK

 

IRELAND


JAPAN

 

 

USA

 

 

 

U.S. Posts $150.4 Billion November Budget Deficit WSJ

 

 

 

2- EU BANKING CRISIS

   

 

3- BOND BUBBLE

 

Investors bailed out of bonds in November, mostly municipals USAT


SocGen- Actually, The US Government Isn't Issuing Enough Debt  BI

 

Market alarm as US fails to control biggest debt in history  Telegraph


4- STATE & LOCAL GOVERNMENT

 

Emptying the pork barrel would hit some states especially hard Stateline

5- CENTRAL & EASTERN EUROPE

 


6-BANKING CRISIS II


A Secretive Banking Elite Rules Trading in Derivatives NYT

Volcker: Worried about mega-bank failure rules MW


7- RISK REVERSAL

 

Stiglitz Says Fed Stimulus Poses `Considerable' Risks for Emerging Markets BL


8- COMMERCIAL REAL ESTATE

 

 

9-RESIDENTIAL REAL ESTATE - PHASE II

 

Is Now The Time To Call The Bottom On The Worst Housing Market In America?  BI

 

The worst housing market in America is Las Vegas, which has continued to plummet in recent readings, with little sign of letting up.  But eventually it will hit bottom, and that could be right now.

 

Two things to consider:

 

First, gaming revenues are clearly rebounding. Nevada gaming revenues grew an impressive 11% in October, the third straight monthly increase. On the strip, revenue rebounded by an even more impressive 16%.

 

Second, this chart which we ran last month shows a pretty nice correlation between hospitality jobs and Nevada home prices (as measured by the Case-Shiller). Now Case-Shiller is pretty laggy, but it's clear that hospitality jobs have troughed, and looked to be starting a rebound. Combine that with the comeback in gaming revenues, and it's easy to imagine an actual bottom in Las Vegas real estate.

 

 

 

10- EXPIRATION FINANCIAL CRISIS PROGRAM

 

 

11- PENSION & ENTITLEMENTS CRISIS



12- CHRONIC UNEMPLOYMENT


The Deluge Of 99ers Begins... Now  Calculated Risk

Regardless of what happens with the tax deal, there's no more support for the so-called 99ers, people who have been on unemployment for the maximum length allowable: 99 weeks.  And their numbers are about to swell.

As this chart from Calculated Risk shows nicely, we're about 99 weeks since the very worst of the job losses from late-2008/early-2009. The extent to which their cutoff slams the consumer recovery (and thus everything else) is a huge issue to consider




13- GOVERNMENT BACKSTOP INSURANCE

 

 

14- CORPORATE BANKRUPTCIES

 

 

17- CHINA BUBBLE


China's Inflation Tops 5%, Adding Pressure for Wen to Raise Interest Rates BL

19- PUBLIC POLICY MISCUES

 

Washington Orders Another Free Lunch Schiff

 

The Economic Sweet Spot of Presidential Terms NYT (Norris)

 

Kicking the can down the road  Economist

 

Why Democrats Should Disregard Bill Clinton's Endorsement of Obama's Tax Deal  Reich

 


 


OTHER TIPPING POINT CATEGORIES NOT LISTED ABOVE

 

24-RETAIL SALES

 

 

26-GLOBAL OUTPUT GAP

 

 

31-FOOD PRICE PRESSURES

 

 

32-US STOCK MARKET VALUATIONS

 

 




   

CENTRAL BANKING MONETARY POLICIES, ACTIONS & ACTIVITIES

------------

 

Fed unlikely to shift from QE2 roll-out  FT

 

The Fed and Money Noland

 

The Fed? Ron Paul’s Not a Fan NYT

Ben Bernanke: Juggler of Digits   North

Defying Critics, Market, FOMC to Stay Course Forsyth

How the bond rout shows Bernanke is right Barr

Fed Overseer Ron Paul Says He Doubts Bernanke Can Prevent Inflation Surge BL

Why Ron Paul's newfound power both pleases and worries libertarians
Slate

 

 GENERAL INTEREST

 Unintended Consequences Mauldin

 

The Nerve to Say No NYT (Morgenson)

FLASH CRASH - HFT - DARK POOLS

 

MARKET WARNINGS

Is Sentiment Flashing A Major Warning Signal  Pragmatic Capitalist

 

“The Investors Intelligence Advisors Sentiment Survey bull-bear spread is once again moving towards the +40% danger zone. When the spread last broke above 40%, in October 2007, the market collapsed spectacularly.

 

In our most recent survey (see above), at the end of November, the bulls minus bears ratio maintained its uptrend off its September low and read +33.6%.  Readings going into the start of the New Year are worth paying attention to, as a move into the forties would be a strong call for defensive measures.”

 

 

CURRENCY WARS

 

MARKET & GOLD MANIPULATION

The central banks don't consider it manipulation, they consider it part of their job  Chaos Theorien
if the currency wars escalate and if we have a sequential collapse of paper currency, there may come a time - we're not there, yet – but there may come a time in the future, when the dollar is collapsing, and in that case we will need to re-start a new currency backed by gold, which would be acceptable in world trade. And if that happens, it would make sense for the United States to commandeer not just the German gold, but all foreign gold in the United States, basically move it to a different location.

Right now it is at the Federal Reserve Bank of New York, which is an independent agency. So it would be good for the United States to in fact commandeer the gold and move it exclusive U.S. government control, away from the Fed, probably at West Point, because we have a good large gold vault there and good security. And at that point, the United States could launch a new version of dollar backed by gold and work with the Europeans, the Japanese and others to make this the new global currency that would be acceptable in world trade. In conversion of the gold we would give the Europeans some kind of treasury certificate in exchange for their gold.

 

Gold Stocks Still Cheap 2 ZEAL


The case against gold G&M

 

AUDIO / VIDEO

 

QUOTE OF THE WEEK



"Gold as money is incompatible with unlimited majority rule and scoffs at the idea that money is just 'credit'. It negates any rationale, however farfetched, for the existence of central banks. It precludes 'fractional reserve banking' or any other method of debasing its utility as a medium of exchange. Last and most important, it SEVERELY curbs the power of government to interfere in the lives of its citizens. No assembly of national “leaders” brought together to “modernize” a financial system will ever agree to its use as money. But let one nation anywhere implement it, and the lid blows off."  
 
William A Buckler
Publisher: The Privateer


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Gordon T Long is not a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. Of course, he recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and barring that, we encourage you confirm the facts on your own before making important investment commitments.ont>

 

© Copyright 2010 Gordon T Long. The information herein was obtained from sources which Mr. Long believes reliable, but he does not guarantee its accuracy. None of the information, advertisements, website links, or any opinions expressed constitutes a solicitation of the purchase or sale of any securities or commodities. Please note that Mr. Long may already have invested or may from time to time invest in securities that are recommended or otherwise covered on this website. Mr. Long does not intend to disclose the extent of any current holdings or future transactions with respect to any particular security. You should consider this possibility before investing in any security based upon statements and information contained in any report, post, comment or recommendation you receive from him.

 

         

TODAY'S NEWS

MONDAY

12-13-10

DECEMBER

S M T W T F S
      1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 29 30 31  

ARCHIVAL

 

 


 

         

TIPPING POINTS

1-SOVEREIGN DEBT & CREDIT CRISIS

2-EU BANKING CRISIS
3-BOND BUBBLE

4-STATE & LOCAL GOVERNMENT

5-CENTRAL & EASTERN EUROPE
6-BANKING CRISIS II
7-RISK REVERSAL

8-COMMERCIAL REAL ESTATE

9-RESIDENTIAL REAL ESTATE - PHASE II
10-EXPIRATION FINANCIAL CRISIS PROGRAM
11-PENSION CRISIS

12-CHRONIC UNEMPLOYMENT

13-GOVERNMENT BACKSTOP INSUR.
14-CORPORATE BANKRUPTCY
 

15-CREDIT CONTRACTION II

16-US FISCAL IMBALANCES
17-CHINA BUBBLE
18-INTEREST PAYMENTS
19-US PUBLIC POLICY MISCUES
20-JAPAN DEBT DEFLATION SPIRAL
21-US RESERVE CURRENCY.
22-SHRINKING REVENUE GROWTH RATE
23-FINANCE & INSURANCE WRITE-DOWNS
24-RETAIL SALES
25-US DOLLAR WEAKNESS
26-GLOBAL OUTPUT GAP
27-CONFIDENCE - SOCIAL UNREST
28-ENTITLEMENT CRISIS
29-IRAN NUCLEAR THREAT
30-OIL PRICE PRESSURES
31-FOOD PRICE PRESSURES
32-US STOCK MARKET VALUATIONS
33-PANDEMIC
34-S$ RESERVE CURRENCY
35-TERRORIST EVENT
36-NATURAL DISASTER

 


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Gordon T Long is not a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. Of course, we recommend that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and barring that, we encourage you confirm the facts on your own before making important investment commitments.

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© Copyright 2010, Gordon T Long. The information herein was obtained from sources which the Gordon T Long. believes reliable, but we do not guarantee its accuracy. None of the information, advertisements, website links, or any opinions expressed constitutes a solicitation of the purchase or sale of any securities or commodities. Please note that the Gordon T Long. or its principals may already have invested or may from time to time invest in securities that are recommended or otherwise covered on this website. Gordon T Long does not intend to disclose the extent of any current holdings or future transactions with respect to any particular security. You should consider this possibility before investing in any security based upon statements and information contained in any report, post, comment or recommendation you receive from us.