God's Gift

I sense this is a once in a generation play.
#1 THE DOLLAR MUST FALL
a. We will wait for a moving average crossover and an MACD crossover
b. BE PATIENT

#2 Conservative Hedge
a. Follow rule #1!! Put in an equal dollar amount long the US dollar, and long 50% gold 50% silver.
b. More aggressive hedge- Replace gold and silver with GDX.

#3 For outwardly aggressive traders
a. Follow rule #1!!
b. Unhedged positions in equal amounts in the Euro, Gold, Silver, Oil, and Agriculture (I personally use commodity markets, not recommended due to extreme leverage in both directions)

This is the US CARRY TRADE. It's coming. It's going to be huge. It will last until Volker does his thing for which he was brought on the Obama team to do. If you want a chance to get rich, this is your chance.

-the gold doctor

Buy this weeks correction

Throw a dart and buy tuesday's low.
Trade for 15%. Long term investors should wait to short the
Dow from about 11,000.
Short and sweet, free money.
-the gold doctor

Inflation, Deflation, Confusion AHHHHHHH

The inflationists constantly remind us that it is the amount of money chasing goods that leads to inflation. It goes something like this... Simplistically, there are two people in the world, each one has one dollar. There is only one item to buy in the whole world, an apple. Eventually the bidding between these two people reaches one dollar because there is nothing else to buy in the world. Then I step in as the government trying to be re-elected, I flood the population by giving each of the two citizens one extra dollar. They now each have two dollars. The bidding for the apple continues and soon approaches the two dollar maximum. Simplistic inflation.

On a much larger scale, we must take into account the speed at which money is spent thus if there is two dollars in the world, but is spent electronically two times in the course of a day, the total real spendable money is the two dollars times the movement equally four dollars. Thus the deflationists suggest even though world central banks are producing trillions of electronic dollars, it is fundamentally not inflationary because, #1 the speed of the movement of money is decelerating, and #2 asset values for examples homes and stocks are going down in value. Both of these individuals are correct given the appropriate period of time for their reference. However the reality is the deflationists currently are correct because the movement of money and the loss of asset value far exceeds the electronic production of new money. An example...the current stock market losses are $8-10 trillion and the current housing losses are in the vicinity of $5 trillion. Even though governments have created a shocking $5 trillion of electronic money, by the above evidence we are clearly in a deflationary period.

Relative to the inflationists, the printed words continue to scream, "but they are printing more money." Although that statement today is true more money is being destroyed then created.

Let's look at tomorrow...
Two things will occur. At some point, the creation of money will equal or appear to be equalling the amount of money destroyed times the change in velocity of that money's movement. When that is perceived whether today or tomorrow or next year, inflationary forces will gain the strong upper hand.

How do we make money? There is no rush. Wait for the technical indicators of moving average crossovers and MACD's to tell us. Speculating is fun and fine but the real money will be made in catching the trend. The people that bought GLD, GDX, XLE etc.. have experienced losses of staggering proportions being 100% correct but one day early.

-The Doctor

How to beat the market in 2009-2010

In the last few years, the US budget deficit represented dollars going to foreign countries. Those countries then needed to reinvest those American dollars. The only available place to invest this many dollars was in US treasury bonds or US corporate bonds made available by the US federal deficit. THERE WAS NO WHERE ELSE IN THE WORLD TO INVEST THIS MANY DOLLARS.

Moving forward--2009-2010 and subsequent years-> The US federal deficit will expand dramatically at the same time corporate bond issuance will continue to dry up. This is the key. There will be no excess capital outside of the United States (normally oil money from the Middle East and/or manufacturing money from Asia) to fund the trillion dollar++ national debt. There are two possible places this funding can come from. #1-The US government can print money electronically to purchase the bonds which must be sold to allow the United States government to function or #2- The United States can get it's hands around baby boomer retirement funds, 401k's and IRA's, and force these moneys to be used to purchase US treasury bills, bonds, and notes. This is under the pretext of making sure the retiring baby boomers will not have their money at risk in the stock market or real estate investments etc.. Let's just call it the confiscation of the baby boomer's retirements. There is no other pile of money available in the world large enough to meet the needs of the US government yearly federal deficit.

What must happen?

#1 US interest rates in 2009-2010 must go up to lure foreign investors into buying additional US bills, notes, and bonds.

#2 The value of all currencies worldwide must devalue in an attempted coordinated system trying to forestall an economic worldwide depression.

#3 All inground assets must go up due to the world wide expansion of currencies.

Investments-

What?

#1 Major Oil Companies- XLE

#2 Major Mining Companies- BHP, FCX

#3 Commodity Producers- DBA

When?

2 options:

For the aggressive trader- In simplistic terms, when each of above three investment 50 day moving average crosses the 200 and both are moving upwards (ie the 50 and the 200). 1/3 of your investment should be placed equally into #1, #2, and #3 above.

For the conservative trader- Using the 50 week and 200 week moving average, do the same.

Charts:

BHP

XLE

DBA