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Sejarah Panjang Manipulasi Harga Emas

January 31st, 2014 No comments

“Gold is a manipulated market. Period. 2013 was the year that manipulation finally began to unravel. 2014? Well now, THIS could be the year that true price discovery begins in the gold market. If that turns out to be the case, it will be driven by a scramble to perfect ownership of physical gold; and to do that you will be forced to pay a lot more than $1247/oz. Count on it.”

– Grant Williams, the editor of Things That Make You Go Hmmm…

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“The gold market is the most manipulated market in the world. It is not free-and-fair in any way. Governments are also setting interest rates at will and this is impacting the housing, commodity markets, and every other financial market. But with a situation like this it is only a matter of time before the gold and silver markets explode higher. I don’t know when the bearish phase in gold and silver will end, but when it does it will end with a bang. Meaning, gold and silver will turn violently higher.”

– Keith Barron

 

Belakangan ini banyak tulisan mengenai proses “gold fixing” London yang dianggap curang (ada manipulasi), bahkan Bloomberg baru-baru ini menemukan manipulasi yang terang-terangan.

Karena banyak investor yang mungkin belum mengetahui bagaimana manipulasi harga emas ini akan berlanjut, maka dalam kesempatan ini saya persembahkan beberapa artikel yang WAJIB DIBACA yang ditulis oleh Tyler Durden dari www.zerohedge.com.

Bacalah artikelnya dengan seksama dan darinya mungkin bisa memberikan Anda keuntungan dari tekanan harga emas:

1)   How Gold Price Is Manipulated During The “London Fix” (November 25th)

There was a time when the merest mention of gold manipulation in “reputable” media was enough to have one branded a perpetual conspiracy theorist with a tinfoil farm out back. That was roughly coincident with a time when Libor, FX, mortgage, and bond market manipulation was also considered unthinkable, when High Frequency Traders were believed to “provide liquidity”, or when the stock market was said to not be manipulated by the Fed, and when the ever-confused media, always eager to take “complicated” financial concepts at the face value set by a self-serving establishment, never dared to question anything. Luckily, all that changed in the past several years, and it has gotten to the point where even the bastions of “serious”, if 3-5 years delayed, investigation are finally not only asking how is the gold market being manipulated, but are actually providing answers.

      Such as Bloomberg.

The topic of gold market manipulation during the London AM fix is not new to Zero Hedge: in fact we have discussed both the historical basis and the raison d’être of the London gold fix, as well as the curious arbitrage available to those who merely traded the AM-PM spread, for years. Which is why we are delighted that none other than Bloomberg has decided to break it down for everyone, as well as summarize all the ways in which just this one facet of gold trading is being manipulated.

      Bloomberg begins:

Every business day in London, five banks meet to set the price of gold in a ritual that dates back to 1919. Now, dealers and economists say knowledge gleaned on those calls could give some traders an unfair advantage when buying and selling the precious metal. The London fix, the benchmark rate used by mining companies, jewelers and central banks to buy, sell and value the metal, is published twice daily after a telephone call involving Barclays Plc, Deutsche Bank AG, Bank of Nova Scotia, HSBC Holdings Plc and Société Générale SA.

The fix dates back to September 1919, less than a year after the end of World War I, when representatives from five dealers met at Rothschild’s office on St. Swithin’s Lane in London’s financial district. It was suspended for 15 years, starting in 1939. While Rothschild pulled out in 2004 and the discussions now take place by telephone instead of in a wood-paneled room at the bank, the process remains much the same.

That much is known. What is certainly known is that any process that involves five banks sitting down (until recently literally) and exchanging information using arcane methods (such as a telephone), on a set schedule that involves a private information blackout phase, even if temporary, and that does not involve instant market feedback, can and will be gamed. “Traders involved in this price-determining process have knowledge which, even for a short time, is superior to other people’s knowledge,” said Thorsten Polleit, chief economist at Frankfurt-based precious-metals broker Degussa Goldhandel GmbH and a former economist at Barclays. “That is the great flaw of the London gold-fixing.”

      There are other flaws.

Participants on the London call can tell whether the price of gold is rising or falling within a minute or so, based on whether there are a large number of net buyers or sellers after the first round, according to gold traders, academics and investors interviewed by Bloomberg News. It’s this feature that could allow dealers and others in receipt of the information to bet on the direction of the market with a high degree of certainty minutes before the fix is made public, they said.

Yes, the broader momentum creation and ignition perspective is also known to most. At least most who never believed the boilerplate that unlike all other asset classes, gold is somehow immune from manipulation.

“Information trickles down from the five banks, through to their clients and finally to the broader market,” Andrew Caminschi, a lecturer at the University of Western Australia in Perth and co-author of a Sept. 2 paper on trading spikes around the London gold fix published online in the Journal of Futures Markets, said by phone. “In a world where trading advantage is measured in milliseconds, that has some value.”

Ah, hypothetical – smart. One mustn’t ruffle feathers before, like in the case of Libor, it becomes fact that everyone was in on it.

There’s no evidence that gold dealers sought to manipulate the London fix or worked together to rig prices, as traders did with Libor. Even so, economists and academics say the way the benchmark is set is outdated, vulnerable to abuse and lacking any direct regulatory oversight. “This is one of the most concerning fixings I have seen,” said Rosa Abrantes-Metz, a professor at New York University’s Stern School of Business whose 2008 paper, “Libor Manipulation?” helped spark a global probe. “It’s controlled by a handful of firms with a direct financial interest in where it’s set, and there is virtually no oversight — and it’s based on information exchanged among them during undisclosed calls.”

Unless we are wrong, there was no evidence of Libor manipulative collusion before there was evidence either. And since the cabal of the London gold fix is far smaller than the member banks of Libor, it is exponentially easier to confine intent within an even smaller group of people. But all that is also known to most.

As is the fact that when asked for comments, ‘spokesmen for Barclays, Deutsche Bank, HSBC and Société Générale declined to comment about the London fix or the regulatory probes, as did Chris Hamilton, a spokesman for the FCA, and Steve Adamske at the CFTC. Joe Konecny, a spokesman for Bank of Nova Scotia, wrote in an e-mail that the Toronto-based company has “a deeply rooted compliance culture and a drive to continually look toward ways to improve our existing processes and practices.”

Next, Bloomberg conveniently goes into the specifics of just how the gold price is manipulated first by the fixing banks, then by their “friends and neighbors” as news of the fixing process unfolds.

At the start of the call, the designated chairman — the job rotates annually among the five banks — gives a figure close to the current spot price in dollars for an ounce of gold. The firms then declare how many bars of the metal they wish to buy or sell at that price, based on orders from clients as well as their own account.

If there are more buyers than sellers, the starting price is raised and the process begins again. The talks continue until the buy and sell amounts are within 50 bars, or about 620 kilograms, of each other. The procedure is carried out twice a day, at 10:30 a.m. and 3 p.m. in London. Prices are set in dollars, pounds and euros. Similar gauges exist for silver, platinum and palladium.

The traders relay shifts in supply and demand to clients during the calls and take fresh orders to buy or sell as the price changes, according to the website of London Gold Market Fixing, which publishes the results of the fix.

.. only this time the manipulation is no longer confined to a purely theoretical plane and instead empirical evidence of the fixing leak is presented based on academic research:

Caminschi and Richard Heaney, a professor of accounting and finance at the University of Western Australia, analyzed two of the most widely traded gold derivatives: gold futures on Comex and State Street Corp.’s SPDR Gold Trust, the largest bullion-backed exchange-traded product, from 2007 through 2012.

At 3:01 p.m., after the start of the call, trading surged to 47.8 percent above the average for the 20-minute period preceding the start of the fix and remained 20 percent higher for the next six minutes, Caminschi and Heaney found. By comparison, trading was 8.7 percent higher than the average a minute after publication of the price. The results showed a similar pattern for the SPDR Gold Trust.

“Intuitively, we expect volumes to spike following the introduction of information to the market” when the final result is published, Caminschi and Heaney wrote in “Fixing a Leaky Fixing: Short-Term Market Reactions to the London P.M. Gold Price Fixing.” “What we observe in our analysis is a clustering of trades immediately following the fixing start.”

The researchers also assessed how accurate movements in gold derivatives were in predicting the final fix. Between 2:59 p.m. and 3 p.m., the direction of futures contracts matched the direction of the fix about half the time.

From 3:01 p.m., the success rate jumped to 69.9 percent, and within five minutes it had climbed to 80 percent, Caminschi and Heaney wrote. On days when the gold price per ounce moved by more than $3, gold futures successfully predicted the outcome in more than nine out of 10 occasions. “Not only are the trades quite accurate in predicting the fixing direction, the more money that is made by way of a larger price change, the more accurate the trade becomes,” Caminschi and Heaney wrote. “This is highly suggestive of information leaking from the fixing to these public markets.”

Oh please, 9 out of 10 times is hardly indicative of any wrongdoing. After all, JPM lost money on, well, zero trading days in all of 2013, and nobody cares. So if a coin landing heads about 200 times in a row is considered normal by regulators, then surely the CTFC will find nothing wrong with a little gold manipulation here and there. Manipulation, which it itself previously said did not exist. But everyone already knew that too.

Cynicism aside, to claim that this clearly gamed process is not in fact gamed, not to say criminally manipulated (because it is never manipulation unless one is caught in the act by enforcers who are actually not in on the scheme) is the height of idiocy. This is why we are certain that regulators will go precisely this route. That too is also largely known. Also known are the benefits for traders who abuse the London fix:

For derivatives traders, the benefits are clear: A dealer who bought 500 gold futures contracts at 3 p.m. and knew the fix was going higher could make $200,000 for his firm if the price moved by $4, the average move in the sample. While the value of 500 contracts totals about $60 million, traders may buy on margin, a process that involves borrowing and requires placing less capital for the bet. On a typical day, about 4,500 futures contracts are traded between 3 p.m. and 3:15 p.m., according to Caminschi and Heaney.

Finally what is certainly known is that the “London fixing” fix would be very simple in our day and age of ultramodern technology, and require a few minutes of actual implementation.

Abrantes-Metz, who helped Iosco formulate its guidelines, said the gold fix’s shortcomings may stretch beyond giving firms and clients access to privileged information. “There is a huge incentive for these banks to try and influence where the benchmark is set depending on their trading positions, and there is almost no scrutiny,” she said.

Abrantes-Metz said the gold fix should be replaced with a benchmark calculated by taking a snapshot of trading in a market where $19.6 trillion of the precious metal circulated last year, according to CPM Group, a New York-based research company. “There’s no reason why data cannot be collected from actual prices of spot gold based on floor or electronic trading,” she said. “There’s more than enough data.”

      This is precisely why nothing will change. Sadly, that is also widely known.

So did Bloomberg put together an exhaustive article in which virtually everything was known a priori? it turns out the answer is no: we learned one thing.

London Gold Market Fixing Ltd., a company controlled by the five banks that administers the benchmark, has no permanent employees. A call from Bloomberg News was referred to Douglas Beadle, 68, a former Rothschild banker, who acts as a consultant to the company from his home in Caterham, a small commuter town 45 minutes south of London by train. Beadle declined to comment on the benchmark-setting process.

You learn something new every day (incidentally, the same Douglas Beadle who acted as a consultant to the LBMA until March 2010 and was involved from the outset in the project to find a suitable scale for the electronic weighing of gold as documented in “Electronic Weighing of Gold – A Success Story“).

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2)   The Complete And Unabridged History Of Gold Manipulation (December 4th)

On November 1st, 1961, an agreement was reached between the central banks of the United States and seven European countries to cooperate in achieving a shared, and very clearly stated, aim.

The agreement became known as the London Gold Pool, and it had a very explicit purpose: to keep the price of gold suppressed “under control” and pegged regulated at $35/oz. through interventions in the London gold market whenever the price got to be a little… frisky.

      The construct was a simple one.

The eight central banks would all chip in an amount of gold to the initial “kitty.” Then they would sell enough of the pooled gold to cap any price rises and then replace that which they had been forced to sell on any subsequent weakness.

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*Statement is subject to standard terms and conditions and is not necessarily reflective of any evidence. Government entities are excluded from inclusion based on the fact that we can’t really do anything about them and anyway; they could put us out of business; and it would make things really, really bad for them. Also, bullion banks are not covered under this statement because we were told to turn a blind eye; but individual investors are, and we can categorically confirm that, to the best of our knowledge, no individuals are manipulating the precious metals markets (at this time).

But, as Grant Williams explains in this excellent and complete summary of the history of Gold price manipulation, things don’t always go as planned…

Human beings, when given means and motive, have rather a poor history of eschewing the easy profit in favor of doing the right thing. Governments, when faced with dilemmas, have a rather poor history of doing the right thing as opposed to whatever they think they need to do in order to cling to power. It’s quite simple.

Libor, FX rates, and mortgages trades are all fiat in nature. The contracts that are exchanged have no tangible value. (Yes, technically speaking, mortgages have houses underneath them, but the houses are so far down the securitization chain as to be invisible). Such contracts can be created at the push of a button or the stroke of a pen and manipulated easily right up until the point where they can’t.

      Gold is a different beast altogether.

The manipulation of the gold price takes place in a paper market — away from the physical supply of the metal itself. That metal trades on a premium to the futures contract for a very good reason: it has real, intrinsic value, unlike its paper nemesis.

If you want to manipulate the price of a paper futures contract lower, you simply sell that paper. Sell it long, sell it short, it doesn’t matter — it is a forward promise. You can always roll it over at a later date or cover it back at a profit if the price moves lower in the interim.

      And of course you can do it on margin.

If the trading were actually in the metal itself, then in order to weaken the price you would have to continue to find more physical metal in order to continue selling; and, as is well documented, there just isn’t so much of it around: in recent years what little there is has been pouring into the sorts of places from which it doesn’t come back — not at these price levels, anyway.

The London Gold Pool had one thing in common with the rigging of the FX, Libor, and mortgage markets: it worked until it didn’t.

The London Gold Pool proved that central banks can collude cooperate to rig maintain the price of gold at what they deem manageable levels, but it also proved that at some point the pressure exerted by market forces to restore the natural order of things becomes overwhelming, and even the strongest cartels groups (whose interests happen to be aligned) — which are made up of the very institutions granted the power to create money out of thin air — can’t fight the battle any longer.

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…The problem now is that currently there are almost 70 claims on every ounce of gold in the COMEX warehouse and serious doubts about the physical metal available for delivery at the LBMA.

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This leads us to today…

The London Gold Pool was designed to keep the price of gold capped in an era when the world’s reserve currency had a tangible backing. In defending the price, the eight members of the Pool were forced to sell way more gold than they had initially contributed in order to keep the price from going where it desperately wanted to go — higher.

This time around, the need for the price to be capped has nothing to do with any kind of gold standard and everything to do with the defense of the fractional reserve gold lending system, about which I have written and spoken many times.

Gold is moving to ever stronger hands, and when the dam does inevitably break again, the true price will be discovered by natural market forces, free of interference.

This time, however, those chasing what little gold is available will include all those central banks that have kept their holdings “safe” in overseas vaults.

The Bundesbank has seen the writing on the wall and demanded its gold back. They were told it would take seven years before their 30 tons could be returned to them.

      My guess is, this little scheme doesn’t have seven years left to play out.

      Everybody outta the pool!

      Full Grant Williams letter here:

TTMYGH Twisted (by the Pool)

 

3)   The FT Goes There: “Demand Physical Gold” As One Day Paper Price Manipulation Will End “Catastrophically” (January 25th)

What have we done: after a series of reports in late 2012 in which we showed, with no ambiguity, that not only might the Bundesbank’s offshore held gold be severely “diluted” (follow our 2012 exposes on German gold here, here, here, and here), but that on at least one occasion, the Fed and the Bank of England conspired against the Buba in returning subpar quality gold, the Bundesbank shocked everyone in early January 2013 when it announced it would repatriate 300 tons of gold held in New York and all of its 374 tons of gold held in Paris. But convincing the Bundesbank to demand delivery was peanuts compared to changing the tune of the Financial Times – that bastion of fiat “money”, and where the word gold is mocked and ridiculed, and those who see the daily improprieties in the gold market as nothing but “conspiracy theorists” – to say the magic words: “Learn from Buba and demand delivery for true price of gold”, adding that “one day the ties that bind this pixilated gold may break, with potentially catastrophic results.

      In other words, precisely what we have been saying since the beginning.

      Welcome to the ‘conspiracy theorist’ club, boys.

From the FT’s Neil Collins: “Learn from Buba and demand delivery for true price of gold: One day the ties that bind the actual and the traded commodity will snap:

A year ago the Bundesbank announced that it intended to repatriate 700 tons of Germany’s gold from Paris and New York. Although a couple of jumbo jets could have managed the transatlantic removal, it made security sense to ship the load in smaller consignments. Just how small, and over how long, has only just become apparent.

Last month Jens Weidmann, Bundesbank president, admitted that just 37 tons had arrived in Frankfurt. The original timescale, to complete the transfer by 2020, was leisurely enough, but at this rate it would take 20 years for a simple operation. Well, perhaps not so simple. While he awaits delivery, Herr Weidmann is welcome to come and look through the bars in the Federal Reserve’s vaults, but the question is: whose bars are they?

In the “armchair farmer” fraud you are told: “Look, this is your pig, in the sty.” It works until everyone wants physical delivery of their pig, which is why Buba’s move last year caused such a stir. After all nobody knows whether there are really 260m ounces of gold in Fort Knox, because the US government won’t let auditors inside.

The delivery problem for the Fed is a different breed of pig. The gold market is far more than exchanging paper money for precious metal. Indeed the metal seems something of a sideshow. In June last year the average volume of gold cleared in London hit 29m ounces per day. The world’s mines are producing 90m ounces per year. The traded volume was many times the cleared volume.

The paper gold in the London Bullion Market takes the familiar forms that bankers have turned into profit machines: futures, options, leveraged trades, collateralized obligations, ETFs . . . a storm of exotic instruments, each of which is carefully logged, cross-checked and audited.

Or perhaps not. High-flying traders find such backroom work tedious, and prefer to let some drone do it, just as they did with those money-market instruments that fuelled the banking crisis. The drones will have full control of the paper trail, won’t they? There’s surely no chance that the Fed’s little delivery difficulty has anything to do with the cat’s-cradle of pledges based on the gold in its vaults?

John Hathaway suspects there is. He worries about all the paper (and pixels) linked to gold. He runs the Tocqueville gold fund (the clue is in the name) and doesn’t share the near-universal gloom of London’s gold analysts, who a year ago forecast an average $1700 for 2013. It is currently $1,260.

As has been remarked here before, forecasting the price is for mugs and bugs. But one day the ties that bind this pixilated gold may break, with potentially catastrophic results. So if you fancy gold at today’s depressed price, learn from Buba and demand delivery.

4)   The Big Reset, Part 2 (January 25th)

      Submitted by Koos Jansen of In Gold We Trust

      This is part two of a Q&A with Willem Middelkoop about his new book The Big Reset. In his book      a chapter on the ‘War on Gold’ takes a prominent position. Willem has been writing about the           manipulation of the gold price since 2002 based on information collected by GATA since the late    1990’s. So part two of our interview will focus on this topic.

     

The War On Gold 

Why Does The US Fight Gold?

      The US wants its dollar system to prevail for as long as possible. It therefore has every interest in      preventing a ‘rush out of dollars into gold’. By selling (paper) gold, bankers have been trying in the      last few decades to keep the price of gold under control. This war on gold has been going on for       almost one hundred years, but it gained traction in the 1960′s with the forming of the London Gold    Pool. Just like the London Gold Pool failed in 1969, the current manipulation scheme of gold (and     silver prices) cannot be maintained for much longer.

     

What is the Essence Of The War on Gold

            The survival of our current financial system depends on people preferring fiat money over gold.   After the dollar was taken of the gold standard in 1971, bankers have tried to demonetize gold. One of the arguments they use to deter investors from buying gold and silver is that these metals do not deliver a direct return such as interest or dividends. But interest and dividend are payments to compensate for counterparty risk – the risk that your counterparty is unable to live up to its obligations. Gold doesn’t carry that risk. The war on gold is, in essence, an endeavor to support the dollar. But this is certainly not the only reason. According to a number of studies, the level of the gold price and the general public’s expectations of inflation are highly correlated. Central bankers work hard to influence inflation expectations. A 1988 study by Summers and Barsky confirmed that the price of gold and interest rates are highly correlated, as well with a lower gold price leading to lower interest rates.

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When Did the War on Gold Start?

The first evidence of US meddling in the gold market can be found as early as 1925 when the Fed falsified information regarding the Bank of England’s possession of gold in order to influence interest rate levels. However, the war on gold only really took off in the 1960′s when trust in the  dollar started to fray. Geopolitical conflicts such as the building of the Berlin Wall, the Cuban   Missile Crisis and the escalation of violence in Vietnam led to increasing military spending by the US, which in turn resulted in growing US budget deficits. A memorandum from 1961 entitled

US Foreign Exchange Operations: Needs and Methods’ described a detailed plan to manipulate  the currency and gold markets via structural interventions in order to support the dollar and    maintain the gold price at $ 35 per ounce. It was vital for the US to ‘manage’ the gold market;   otherwise countries could exchange their surplus dollars for gold and then sell these ounces on the free gold market for a higher price.

 

How Was The Gold Price Managed In The 1960′s?

During meetings of the central bank presidents at the BIS in 1961, it was agreed that a pool of $270 million in gold would be made available by the eight participating (western) countries. This so-called ‘London Gold Pool’ was focused on preventing the gold price from rising above $ 35 per ounce by selling official gold holdings from the central banks gold vaults. The idea was that if        investors attempted to flee to the safe haven of gold, the London Gold Pool would dump gold onto       the market in order to keep the gold price from rising. During the Cuban Missile Crisis in 1962, for  instance, at least $ 60 million in gold was sold between 22 and 24 October. The IMF provided   extra gold to be sold on the market when needed. In 2010, a number of previously secret US telex  reports from 1968 were made public by Wikileaks. These messages describe what had to be  done in order to keep the gold price under control. The aim was to convince investors that it was completely pointless to speculate on a rise in the price of gold. One of the reports mentions a         propaganda campaign to convince the public that the central banks would remain ‘the masters of   gold’. Despite these efforts, in March 1968, the London Gold Pool was disbanded because France  would no longer cooperate. The London gold market remained closed for two weeks. In other gold   markets around the world, gold immediately rose 25% in value. This can happen again when the  COMEX will default.

     

More Evidence About This Manipulation?

From the transcript of a March 1978 Fed-meeting, we know that the manipulation of the gold price  was a point of discussion at that time. During the meeting Fed Chairman Miller pointed out that it  was not even necessary to sell gold in order to bring the price down. According to him, it was  enough to bring out a statement that the Fed was intending to sell gold.

Because the US Treasury is not legally allowed to sell its gold reserves, the Fed decided in 1995  to examine whether it was possible to set up a special construction whereby so-called ‘gold     swaps’ could bring in gold from the gold reserves of Western central banks. In this construction,      the gold would be ‘swapped’ with the Fed, which would then be sold by Wall Street banks in order      to keep prices down. Because of the ‘swap agreement’, the gold is officially only lent out, so Western central banks could keep it on their balance sheets as ‘gold receivables’. The Fed started   to informing foreign central bankers that they expected that the gold price to decline further, and     large quantities of central banks’ gold became be available to sell in the open market. Logistically  this was an easy operation, since the New York Fed vaults had the largest collection of foreign    gold holdings. Since the 1930′s, many Western countries had chosen to store their gold safely in     the US out of fears of a German or Soviet invasion.

Didn’t The British Help As Well By Unloading Gold At The Bottom Of The Market?

Between 1999 and 2002, the UK embarked on an aggressive selling of its gold reserves, when    gold prices were at their lowest in 20 years. Prior to starting, the Chancellor of the Exchequer,   Gordon Brown, announced that the UK would be selling more than half of its gold reserves in a   series of auctions in order to diversify the assets of the UK’s reserves. The markets’ reaction was    one of shock, because sales of gold reserves by governments had until then always taken place   without any advance warning to investors. Brown was following the Fed’s strategy of inducing a fall in the gold price via an announcement of possible sales. Brown’s move was therefore not         intended to receive the best price for its gold but rather to bring down the price of gold as low as possible. The UK eventually sold almost 400 tons of gold over 17 auctions in just three years, just as the gold market was bottoming out. Gordon Brown’s sale of the UK’s gold reserves probably  came about following a request from the US. The US supported Brown ever since.

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How Do They Manipulate Gold Nowadays?

The transition from open outcry (where traders stand in a trading pit and shout out orders) to electronic trading gave new opportunities to control financial markets. Wall Street veteran lawyer     Jim Rickards presented a paper in 2006 in which he explained how ‘derivatives could be used to      manipulate underlying physical markets such as oil, copper and gold’. In his bestseller entitled             Currency Wars, he explains how the prohibition of derivatives regulation in the Commodity   Futures Modernization Act (2000) had ‘opened the door to exponentially greater size and variety      in these instruments that are now hidden off the balance sheets of the major banks, making them       almost impossible to monitor’. These changes made it much easier to manipulate financial     markets, especially because prices for metals such as gold and silver are set by trading future        contracts on the global markets. Because up to 99% of these transactions are conducted on          behalf of speculators who do not aim for physical delivery and are content with paper profits,             markets can be manipulated by selling large amounts of contracts in gold, silver or other          commodities (on paper). The $200 crash of the gold price April 12 and 15, 2013 is a perfect         example of this strategy. The crash after silver reached $50 on May 1, 2011 is another textbook          example.

For How Long Can This Paper-Gold Game Continue?

As you have been reporting yourself we can witness several indications pointing towards great           stress in the physical gold market. I would be very surprised when the current paper gold game      can be continued for another two years. This system might even fall apart in 2014. A default in   gold and/or silver futures on the COMEX is a real possibility. It happened to the potato market in         1976 when a potato-futures default happened on the NYMEX. An Idaho potato magnate went       short potatoes in huge numbers, leaving a large amount of contracts unsettled at the expiration       date, resulting in a large number of defaulted delivery contracts.

So it has happened before. In such a scenario futures contracts holders will be cash settled. So I       expect the Comex will have to move to cash settlement rather than gold delivery at a certain             point in the not too distant future. After such an event the price of gold will be set in Asian       markets, like the Shanghai Gold Exchange. I expect gold to jump $1000 in a short period of time and silver prices could easily double overnight. That’s one of the reasons our

Commodity Discovery Fund invests in undervalued precious metal companies with large       gold/silver       reserves. They all have huge up-side potential in the next few years when this             scenario will play out.

       In Gold We Trust

Synopsis of The Big Reset: Now five years after the near fatal collapse of world’s financial system    we have to conclude central bankers and politicians have merely been buying time by trying to           solve a credit crisis by creating even more debt. As a result worldwide central bank’s balance       sheets expanded by $10 trillion. With this newly created money central banks have been buying         up national bonds so long term interest rates and bond yields have collapsed. But ‘parking’ debt at    national banks is no structural solution. The idea we can grow our way back out of this mountain       of debt is a little naïve. In a recent working paper by the IMF titled ‘Financial and Sovereign Debt           Crises: Some Lessons Learned and Those Forgotten’ the economist Reinhart and Rogoff point to            this ‘denial problem’. According to them future economic growth will ‘not be sufficient to cope with       the sheer magnitude of public and private debt overhangs. Rogoff and Reinhart conclude the size     of the debt problems suggests that debt restructurings will be needed ‘far beyond anything      discussed in public to this point.’ The endgame to the global financial crisis is likely to require            restructuring of debt on a broad scale.

 About the author: Willem Middelkoop (1962) is founder of the Commodity Discovery Fund and a        bestselling Dutch author, who has been writing about the world’s financial system since the early      2000s. Between 2001 and 2008 he was a market commentator for RTL Television in the         Netherlands and also appeared on CNBC. He predicted the credit crisis in his first bestseller in      2007.

Link Willem Middelkoop

What Do the Charts Say?

Per 17 Januari ada sekitar 500 ribu troy ounce emas terdaftar, dan ada 111,6 pemilik di setiap troy ounce-nya.

Saat ini ada 41,309 juta troy ounce kontrak berjangka emas yang diperdagangkan – diistilahkan juga dengan ‘paper gold’, artinya bukan emas sungguhan/fisik.

Karena demikian besarnya, tentunya jika hanya sebagian kecil saja para pemilik kontrak berjangka emas tersebut menginginkan delivery, maka dapat mendorong kenaikan harga emas.

Inilah yang oleh John Hathaway, salah satu yang pandangannya terhadap emas paling disegani di dunia, dibahas baru-baru ini dalam wawancaranya dengan King World News

(www.kingworldnews.com).

Dalam pembahasannya tersebut, Mr. Hathaway juga menyertakan grafik yang sangat menarik untuk diamati:

“Bullion banks are extending credit to trading entities — probably high-frequency traders, hedge funds, and the other usual suspects — that don’t have any physical gold at all….

These entities are just using the price of physical gold as an index — it’s just like LIBOR.  As far as I’m concerned, the more leveraged these entities are when things turn around, and then they realize they are obviously on the wrong side of the trade, the more explosive the upside will be.

Some are asking, ‘How far can they stretch the rubber band?’  We thought 90 to 1 was pretty stretched, and yet here we are at 112 to 1.

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It ultimately comes down to the willingness of bullion banks to extend credit with very little connection to gold, other than using it as a reference point for profit and loss, to people with a huge amount of money so they can speculate.  Let’s face it – the high-frequency guys who have been bashing gold for the last two years, if they decide to turn their trade around, they can drive gold to the moon.

These entities are just looking for profit.  They are a bigger part of the market today than they were back in 2011.  They don’t think in macro-terms — they just look at charts.  If they are running more money today, and if they are caught wrong-footed on the gold trade, that can be extremely explosive for the price of gold.

If we end up with the added fuel of various entities having the desire to own the physical gold instead of the paper contracts, that’s a double-barreled scenario  that would guarantee an explosion in the price of gold.”

Agar tetap ceria setelah mambaca artikel yang cukup panjang ini, saya sertakan juga sebuah gambar lucu berjudul The New Normal:

Nico-15

Terima kasih sudah membaca dan semoga beruntung!

Dibuat Tanggal 29 Januari 2013

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Apakah Bursa Saham Mulai ‘Gemetar’?

October 23rd, 2013 1 comment

“If the economy was truly healthy, we should be seeing consistent jobs growth, better manufacturing data, higher consumer spending, and rising corporate revenues. These are the reasons why the stock market should advance higher, and not simply because the easy money is allowed to flow unabated into the economy. When this happens, it opens up the stock market to potential issues and selling down the road.”

– George Leong, Profit Confidential

Kali ini laporan saya buat agak singkat namun sebisa mungkin saya ingin tetap bermanfaat, karena di hari yang sama dengan laporan ini buat saya akan memberikan komentar di sebuah stasiun televisi swasta di Jakarta.

Belakangan ini bursa saham menjadi teka-teki bagi para investor. Ada yang mengatakan harga-harga saham sudah demikian tinggi, terutama untuk saham-saham berkapitalisasi besar. Memang ada benarnya!

Mayoritas peningkatan harga saham tahun ini disebabkan oleh MULTIPLE EXPANSION, bukan oleh pertumbuhan pendapatannya.

Namun, dalam dunia yang jauh dari kenyataan (fantasi), bisa saja harga saham yang overvalue berkembang menjadi overvalue secara fantastis.

Seperti kita tahu, adalah pencetakan uang yang menyebabkan multiple expansion di harga-harga saham hingga saat ini. Karena plafon hutang dinaikkan maka pencetakan uang akan semakin meningkat, dan perlu dipertimbangkan multiple expansion tersebut akan meningkat pula.

Pendapatan bisa kembali bertumbuh bersama dengan multiple expansion karena inflasi akan mendorong pertumbuhan nominal lebih tinggi.

Singkatnya, kita akan menyaksikan kenaikan harga saham lagi karena berlanjutnya pencetakan uang sebelum terjadi keruntuhan seperti era Weimar.

Meskipun saya tetap yakin bahwa sistem finansial global akan runtuh suatu saat, sejumlah grafik indeks saham maupun saham-saham secara individu menunjukkan masih ada kenaikan dari harga-harga saat ini.

Tentunya bisa terjadi reversal dengan mudah jika sejumlah indikator ekonomi penting kian memburuk, namun apa yang saya lihat pada momentum saat ini cukup konstruktif.

Meskipun banyak para ahli yakin bahwa saham-saham sudah berada dalam kondisi bubble, kenaikan masih akan berlanjut karena pencetakan uang.

Namun demikian, Tyler Durden dari www.zerohedge.com mengingatkan dalam 2 laporan terakhirnya bahwa multiple expansion sedang memasuki wilayah berbahaya:

1)   Is The Multiple-Expansion “Dream” Over? (October 5th)

The current market environment of increasing event risk (suppressed by the all too visible un-tapering hand of the Fed) and slumping earnings expectations has had little to no effect on either the US equity market nominal level or the commission-taking asset-gatherers pitching the “long-term” buy that the market always is. Through the magic of multiple expansion, stocks remain at all-time highs and are pitched as “cheap” because multiples can still get bigger – remember March 2000 25.6x P/E… There is only one thing wrong with that dream. No matter how hard the Fed tries (mistakenly as we noted here) to pump the “economy” full of money to make consumers feel good, Consumer Sentiment has hit a wall…

The ubiquitous “but P/Es can expand much much more before they have hit a ‘top” chart…

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But aside from the dot-com bubble, current levels of valuation are at or near peak of the last 30 years…

On a historical earnings basis…

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and a forward-looking basis…

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But, it’s all about confidence… investors will not be willing to pay increasing multiples unless they are confident that the future streams of earnings are sustainable and forecastable… And simply put, the current levels of Consumer Sentiment need to almost double for the US equity market to approach historical multiple valuation levels…

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2)   Goldman: Entire S&P Move Higher Is Due To Multiple Expansion; Shiller P/E Says 30% Overvalued So… Buy (October 19th)

While it has been a stretch to call Bernanke’s post-2009 experiment in “wealth-effect” central planning (where in 2013 the Russell 2000 has outperformed the composite hedge fund by a factor of over 500%!) a “market”, here are some of the latest market thoughts by Goldman’s David Kostin.

US stocks surged to an all-time high of 1745 following the debt accord. The S&P 500 has returned 22% YTD driven almost entirely by P/E multiple expansion rather than higher earnings.

In other words, there has been zero actual bottom line improvement in 2013. Zilch. Nada. All this despite so many loud promises by every pundit in late 2012 that 2013 will be the year of the turn, just wait, you’ll see. It also means there has been zero “fundamental” component to the upside. All of it is multiple expansion. What’s another name for that? Why, “the Fed.”

Bearishly inclined investors will point to the cyclically-adjusted P/E ratio popularized by newly-crowned Nobel laureate Robert Shiller that suggests the S&P 500 is roughly 30% overvalued based on 10-year trailing average reported EPS.

“30% overvalued” by a person who just won the Nobel prize for saying the market is irrational and creates bubbles? You don’t say. Why is a perfect segue into the final Goldman notice:

We forecast the index will climb to 1750 by year-end 2013, a slim advance less than 1% above today’s level. Our year-end 2014 price target remains 1900 or 9% above the current level. S&P 500 trades at 2.6x price/book value. From a valuation perspective, the index level is consistent with the market’s current return on equity (ROE) of 15.5%, and in-line with the 35-year average P/B.

To summarize Goldman:

  • All upside is multiple expansion-driven, i.e. relentless Fed pumping of risks as the final bubble grows to unprecedented proportions,
  • A market which even tenured economists say is a disaster waiting to happen.
  • But hey, the music is still playing so everyone must dance all the way until Goldman’s 2100 target… in 2015.

All of this has come and gone before, but since this time will be different, one can just ignore the recurring past.         

What Do the Charts Say?

Ketika pasar global terus berusaha bertahan, penulis media kawakan, Richard Russell, memberikan peringatan pada para investor pada 1 Oktober lalu bahwa mereka harus siap menyaksikan “massive and radical change,” karena bursa saham global akan mencapai puncaknya dan kemudian mengalami penurunan bersejarah.

Lebih lanjut Russel juga menjelaskan bagaimana penurunan besar akan mengantar pada sistem  moneter baru:

“This site will be about the Dow formation that we see below.  This formation is known as the “megaphone formation” or the “broadening formation.”

Nic-66The broadening formation is indicative of a market in turmoil, with sentiment swinging wildly from one way to the other.  Incredibly, the broadening formation has appeared in every major bear market since 1929.  It appeared prior to WWII in 1929.  It appeared in 1957 and 1965-66.  We saw a broadening top in 1987 and again in 1998-2000.  The most recent broadening formation we saw was in 2004 to 2008.

I have long speculated about the sentiment basis of broadening formations.  Each broadening formation is made up of three rising waves and two corrective waves.  As far as sentiment is concerned, I believe broadening formations are the result of wildly swinging reversals in sentiment from bearish to bullish — and then bearish, and finally a huge swing back to extreme bullishness.  This final wave of optimism is the market’s kiss of death, since this final rising wave takes stocks far above known values.

The current broadening formation is unique in that it is, by far, the largest broadening formation that I have ever seen.  Note that wave D to E has not yet touched the upper trend line.  Frankly, I don’t know whether it is necessary for the Dow to make contact with the upper trend line in order to complete the formation.

If the Dow is to touch the upper trend line of the formation, the Dow will have to advance to at least 16,000, which would be an all-time high.  An interesting thesis here is that earnings alone are not the reason for the Dow advancing.  What is driving this market higher is an increase in price/earnings.  In other words, earnings have not been rising, but what has been boosting the market is investors’ sentiment.  Investors have been increasingly bullish on the market, and therefore, they have been willing to pay more and more for the same amount of earnings.

I’ve written about this before.  The major swings in stock prices are often a result of drastic changes in the price/earnings ratio.  Investors become too bullish or too bearish about stocks.  When they become too bullish, this thrusts stocks into the dangerously overvalued zone.  The opposite is true when investors become too bearish.  Charles Dow wrote that unless there was some special reason, stocks were overvalued when dividends sank below 3.5%.

Back to the broadening formation:  In past cases, the bear market associated with a broadening formation carried to the lower trend line of the formation.  So let’s consider that the current broadening formation follows the typical pattern.  In that case, we might expect the Dow to top out anywhere from its current position to a level around 16,000 or even a bit higher. 

Assuming that a major bear market will begin from wherever the Dow tops out, we can assume that the Dow will decline to at least the right end of the lower trend line of the broadening formation.  If that holds true, then we can expect the bear market will take the Dow down to at least 5,000.  That would represent a horrendous loss, although not nearly as bad as the 1929 to 1932 bear market.

I’ve searched my mind to try to understand what a bear market to Dow 5,000 might mean.  In the first place, I think such a bear market could involve a new monetary system.  I also think a huge bear market would see the balance of international power shift from the US to China.  Finally, the giant megaphone formation that I show could be an advance message to the effect that we must all be ready for massive and radical change.

Question — How do you think we should prepare for these massive changes that you foresee?  I’m not really sure, but my first response is that we must abolish greed and become spiritual.  Currently, it seems to me that the emphasis is on profit, growth at any price, power, greed and wealth.”

To subscribe to Richard Russell’s Dow Theory Letters CLICK HERE.

Terakhir untuk menutup laporan ini saya persembahkan sebuah lelucon wajib di dunia golf

Tiger Woods and Stevie Wonder are in a bar.

Tiger turns to Stevie and says, “How’s the singing career going?”

Stevie replies, “Not too bad. How’s the golf?”

Woods replies, “Not too bad, I’ve had some problems with my swing, but I think I’ve got that right now.”

Stevie says, “I always find that when my swing goes wrong, I need to stop playing for a while and not think about it. Then, the next time I play, it seems to be all right.”

Incredulous, Tiger says, “You play GOLF?”

Stevie says, “Yes, I’ve been playing for years.”

Tiger says, “But – you’re blind! How can you play golf if you can’t see?”

Stevie Wonder replies, “Well, I get my caddy to stand in the middle of the fairway and call to me. I listen for the sound of his voice and play the ball towards him. Then, when I get to where the ball lands, the caddy moves to the green or farther down the fairway, and again I play the ball towards his voice.”

“But how do you putt?” asks Tiger.

“Well,” says Stevie, “I get my caddy to lean down in front of the hole and call to me with his head on the ground and I just play the ball toward his voice.”

Tiger asks, “What’s your handicap?”

Stevie says, “Well, actually – I’m a scratch golfer.”

Woods, incredulous, says to Stevie, “We’ve got to play a round sometime.”

Stevie replies, “Well, people don’t take me seriously, so I only play for money, and never play for less than $10,000 a hole. Is that a problem?”

Woods thinks about it and says, “I can afford that; OK, I’m game for that. $10,000 a hole is fine with me. When would you like to play?”

Stevie Wonder says, “Pick a night.”

Terima kasih sudah membaca dan semoga beruntung!

Dibuat Tanggal 22 Oktober 2013

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Investor Bursa, Hati-hati Melangkah!

October 8th, 2013 No comments

“It is only a matter of time before the US stock market runs into devastating problems due to the Fed QE program. We may well have had a big, big rally in the U.S. stock market, but it’s not based on reality. I would encourage investors to know you’re in a fool’s paradise, be careful, and when people start singing praises, say, ‘I’ve been to this party before, and I know now it’s time to leave.’”

– Jim Rogers

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“… It appears to us that many market participants are quite dissonant regarding how they should be positioned, wrestling with the competing sentiments: “I can’t afford to miss a rally, but I sure can’t afford to get killed if things go in the other direction because none of this is real.”

– Jim Mooney, head of Baupost’s Public Investment group

Saat indeks S&P 500 AS mendekati rekor tertingginya banyak analis yang mengatakan bahwa itu adalah puncak kenaikannya. Namun, masih terlihat pola klasik untuk tren kenaikan, yakni formasi higher highs dan higher lows.

Jadi jangan terjebak oleh kondisi negatif di luar bursa, yakni seputar isu shutdown sejumlah lembaga pemerintah dan isu plafon hutang yang belakangan ini menghantui pasar. Sampai harga memberitahukan kita, hendaknya kita bertahan dengan menjadikan sinyal-sinyal kenaikan sebagai pegangan.

Namun sebaiknya selalu ingat apa hal yang kebanyakan orang tidak fokus saat ini. Harga saham naik bukan karena besarnya pendapatan, dividen atau alasan fundamental perusahaan, melainkan karena the Fed masih akan melanjutkan cetak uang (QE).

Malahan, pendapatan perusahaan seperti sudah mencapai puncak peningkatannya karena pemangkasan biaya sepertinya sudah mencapai batas efektifitas.

Seperti terlihat dalam grafik di bawah ini, dari www.streettalklive.com, memperlihatkan bahwa pertumbuhan revenue masih sangat lemah sementara earning melonjak akibat “accounting magic.”

Ini mencerminkan perekonomian dan pembelanjaan konsumen yang lesu, yang akan mempersulit justifikasi level-level kenaikan (valuasi) saham saat ini.

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Berikut, grafik lainnya dari Gallup dan Bloomberg yang secara jelas menunjukkan bahwa hal-hal normal yang ada hanya tinggal … keyakinan, harapan, dan kebaikan bank sentral:

Nic-28(h/t @Not_Jim_Cramer)

Berbicara tentang valuasi dalam tingkat wajar saat ini, Sy Harding, seorang editor di Street Smart Report (http://www.StreetSmartReport.com), mengingatkan kita dalam 2 laporan luar biasanya, yang menurutnya bahwa Warren Buffett pun hampir tidak menemukan peluang investasi yang lebih layak.

Jika investor terkaya dunia itu saja sulit mendeteksi saham-saham yang sedang berada dalam valuasi atraktifnya, apalagi kita…?

Mari baca laporan di bawah ini untuk mengetahui apa yang dikatakan Mr. Buffett mengenai kondisi bursa belakangan ini, dan mengapa ini akan menjadi cara terbagus untuk meningkatkan kewaspadaan Anda:

1)   Has Warren Buffett Nailed Another Market Top? (September 20th)

I know. I know. Warren Buffett is not a market-timer, has no idea what the market will be doing this year, or next, or at any specific time in the future. Or so he says, and the media seems to accept it as fact.

So we probably shouldn’t pay attention to what he is doing and saying now.

However, in spite of what he says, Buffett has a remarkable track record of accurately calling the serious market tops and bottoms.

That record began in 1956, when he launched Buffett Partnership Ltd., a limited partnership investment company, similar in make-up to the hedge-funds of today. He managed that fund with major success, with performance that would have turned an investor’s $10,000 in 1957 into $300,000 by 1969.

He then pulled off one of the most exquisite market-timing moves of all time.

After making those huge gains in the 1960’s bull market, and while investors were still piling into the stock market with excitement, Buffett liquidated his partnership fund and returned their significantly elevated assets to his investors, telling them they’d probably be better off in government bonds for the next several years.

And indeed, the horrible 1970’s decade began almost immediately, with the Dow losing 35% in the 1969-70 bear market.

Buffett stayed away from the stock market, in spite of the 1969-1973 bull market lifting the Dow back to its 1969 peak and somewhat higher. He settled for managing the businesses he had acquired control of, including textile mill Berkshire Hathaway (which he soon began expanding into the insurance industry).

And then, with another superb market-timing move, after the Dow had lost 45% of its value in the 1973-74 bear market, Buffett returned to the stock market.

In a famous 1974 interview in Forbes magazine, he said, “This is the time to start investing again.” And he did so big-time, using Berkshire Hathaway as the holding company for his investments.

Were those two market moves the end of his market-timing history? Not at all.

Thanks to the powerful 1990’s bull market, by 1999, Berkshire Hathaway had certainly become way too big to be able to liquidate if Buffett became bearish on the market.

But at what turned out to be the top of that spectacular 1990’s bull market, in 1999 Buffett raised Berkshire’s cash level to a huge $48 billion.

He didn’t describe it as market-timing of course, simply saying “I just can’t find anything I want to invest in right now.”

At the same time, in September, 1999, as reported in Fortune magazine, he said, “What I am about to say – assuming it’s correct – will have implications for the long-term results to be realized by American stock-holders…Over the next 17 years, equities will not perform anything like – anything like – they have performed over the past 17 years…If I had to pick a probable annual return it would be 4% after inflation, and if 4% is wrong, I believe the percentage is as likely to be less as more.”

Exquisite market timing?

The market almost immediately rolled over into the severe 2000-2002 bear market and the so-called “lost decade”.

So should we be concerned that, according to the latest SEC filings of Berkshire Hathaway, Buffett has again raised and is sitting on, $49 billion in cash? And in a recent interview he said, “Stocks have moved a long way. They were very cheap five years ago. That’s been corrected…We’re having a hard time finding things to buy.”      

Tentunya, sekali lagi perlu ditekankan bahwa cenderung memegang kas $49 milyar di tangan bukanlah karena sebatas soal ‘market-timing’, namun karena dia tidak dapat menemukan saham-saham yang cukup murah untuk dibeli.

Dan mungkian dia merubah pikirannya dari prediksinya tahun 1999 mengenai masalah pasar dalam 17 tahun. Namun, seperti yang dikatakannya, Buffet bukanlah seorang yang menganut ‘market-timer’ dan sama sekali tidak mengetahui apa yang akan terjadi di bursa.. Yeah…

Buffet akan jadi perhatian saya.

2)   Everything Still Looks Bullish – In the Rear-View Mirror (September 27th)

Dalam warning-nya tahun 1999, Buffett mengatakan bahwa bursa saham dalam 17 tahun ke depan tidak akan (sebagus) seperti 17 tahun ke belakang  seraya menyebut sejumlah hal menarik dari hasil observasinya.

He said [in 1999], “Investors in stocks these days are expecting far too much. . . . . . Once a bull market gets under way, and once you reach the point where everybody has made money no matter what system he or she followed, a crowd is attracted into the game that is responding not to interest rates and profits, but simply to the fact that it seems a mistake to be out of stocks. In effect, these people superimpose an I-can’t-miss-the-party factor on top of the fundamental factors that drive the market. . . . . . . Investors project out into the future what they’ve been seeing. That’s their unshakable habit: looking into the rear-view mirror instead of through the windshield. . . . Staring back at the road just traveled [this was in 1999] most investors have rosy expectations.”

If we do that now, we sure see no problems.

There’s a super impressive bull market stretching back for more than four and a half years. We see there were some bumps in the road that needlessly made investors nervous. The economy slowed in the summer of each of the last four years. But the Fed solved those situations by jumping in with more stimulus each time. There was a debt-ceiling fight in Washington in 2011 that resulted in a 20% plunge by the S&P 500. But that was obviously just a buying opportunity once Congress came out of its funk at the last minute and took care of the problem. In the mirror we can also see that markets in Asia and elsewhere plunged, and the euro zone debt crisis kept popping up. But for the U.S. market, those were clearly just bullish bricks in the wall of worry that stock markets climb. And look at that. Investors who were previously seeing only the 2008 crash and its aftermath in the rear view mirror, and as a result were pulling money out of mutual funds all through the bull market, finally turned the corner, like what they now see in the mirror, and have been pouring money back in at a record pace for almost a year now.

More recently in the rear-view mirror, the Federal Reserve threatened to taper back its QE stimulus. But when markets showed their displeasure, the Fed changed its mind.

So, all is still looking great in the rear-view mirror, rosy in fact.

But Buffett has been right, at least so far, with his 1999 prediction that the next 17 years wouldn’t look anything like the previous 17.

I mean, looking further back in the rear-view mirror than just the last five years – maybe you shouldn’t – prior to the current bull market there have been two severe bear markets since 1999, which until recently have had the market significantly underwater for 13 years, in fact by as much as 50%.

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Memang akan lebih ada penyesuaian untuk melihat ke depan, daripada melihat ke belakang.

Menurut Buffett tahun 1999 lalu kita seharusnya melihat dari sisi arah suku bunga, keuntungan dan valuasi saham, bukan dari kaca spion tapi melaui kaca depan.

Suku bunga karena: they act on financial valuations the way gravity acts on matter: The higher the rate the greater the downward pull. If government rates rise, the prices of all other investments must adjust downward.”

Corporate profits karena nilai sebuah saham perusahaan pada akhirnya akan dinilai melalui earning-nya.

Jadi suku bunga yang sudah jatuh mendekati 0% dalam 5 tahun terakhir, mulai akan dinaikkan, dan nampaknya cukup menghantui pasar perumahan.

Dan kenyataannya corporate earnings growth melamban secara signifikan dalam lebih kurang 2 tahun ini.

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Dan dalam beberapa pekan terakhir, Buffett bersama investor milyuner dunia lainnya, yakni Carl Icahn, dan Stanley Druckenmiller menyatakan kekhawatiran mereka terhadap kenaikan bursa.

Dan apakah yang menjadikan mereka khawatir ke depannya?

Mengapa Kongres ‘bermain’ dengan debt-ceiling lagi?

Yang sudah siap menanti adalah the Fed, segera setelah Kongres meluluskan permintaan AS, untuk melanjutkan stimulus yang masih akan diperlukan untuk menopang ekonomi.

Jadi ya memang, pandangannya tidak terlalu bagus melalui kaca depan. Namun ini juga saatnya bagi investor untuk menarik pandangan dan harapan dari kaca spion serta lebih fokus pada hal-hal yang akan terjadi nanti.

What Do the Charts Say?

Kali ini saya akan mempersembahkan 2 bulah laporan technical yang baik.

Yang pertama datang Richard Russell, yang kini disebut dengan the Godfather of newsletter writers.

Pada 24 September 2013, dia mengingatkan mengenai 2 hal yang membuatnya ragu pada tren bursa saat ini dan melampirkan 2 grafik saham yang dapat memberikan pertanda di masa depan:

“Last week saw the D-J Industrial Average and the D-J Transportation Average hit joint new highs.  Ordinarily, that action should present a valid signal for further highs.  Only two items give me pause.  The first is the advance-decline line for the NYSE.  The chart below shows this A-D line running into resistance at a triple-top delineated by the horizontal blue line, which I have drawn in on the chart.

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The second questionable item is the D-J Utility Average.  This average appeared in 1929, so it was never incorporated into classic Dow Theory.  Nevertheless, the Utility Average has a history of topping out three months ahead of the rest of the market.  Although, on occasion the Utilities have topped out simultaneously with the rest of the market.  I show the Utility Average below, and it does indeed appear to have topped out.

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I almost hesitate to write the following, but I will report that after reading the latest edition of Barron’s from cover to cover, there was no mention of the possibility of the stock market having topped out last week, even with the surprise report that the Fed was not tapering.  I’m not going to go into the “why’s” or “how comes” of the Fed’s decision, let’s just watch the market and see how it acts. 

On the day the non-tapering was announced, the Dow ended the session up 147 points.  The following day the Dow was down 40 points.  My reaction was, “Maybe the ‘smart boys’ are selling into the bullish action created by the non-tapering news.”  I wondered if the rally would resume on Friday, but no such luck.  On Friday the Dow dropped 185 points.  This second day of selling had me sitting up and paying attention.  Could the pros be selling into the good news?  And if that was the case, what can we expect this week?

So how are things at the company level?  For the answer to this, I turn to mighty Wal-Mart, the nation’s biggest employer and the nation’s largest retailer.  The recent action of WMT has my attention.  The long rising trend line has been violated and now WMT has rallied back to contact the underside of the trend line.  So far, so good?

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Below is Apple, the glamour stock of 2013.  They’re out with their new iPhones, but the stock acts “funny.”  In the most recent action the stock sank below its down-pointing trend line, and then it gapped down from there.”

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John Rubino, penulis The Coming Collapse of the Dollar, How to Profit From the Coming Real Estate Bust, and Main Street, Not Wall Street, mengatakan pada para investor perlu menjaga kewaspadaan karena terrible technicals:

“I have a theory about technical indicators, which is that most people only pay attention to the ones that confirm what they already think. Technicals are primarily entertainment, in other words. But every once in a while a market’s charts, graphs, and images line up in a persuasive way, and for U.S. stocks this looks like one of those times. A few examples:

Margin debt

This is a measure of how much money investors have borrowed against their stocks to buy new stocks. The more exciting their recent gains, the more willing they are to borrow. By definition, they’re most excited when stocks have been going up for a long time (otherwise stocks would have stopped going up), so high margin debt tends to precede big corrections. Today, margin debt is just shy of 2007′s all-time record.

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Magazine cover hyperbole

The big consumer magazines are known for being inappropriately excited or depressed at major market turns. Businessweek’s “Death of Equities” cover – just before the beginning of the 1982-2000 super-bull market – is the most notorious. Time came in a close second with its “Home Sweet Home” cover just before the housing bubble burst, and is now back with a cover titled “How Wall Street Won” – though its subtitle, “Five years after the crash, it could happen all over again,” implies that the editors may be hedging their bets. This isn’t a perfect example of magazine hubris, but is close enough for our purposes.

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Excessive P/E ratios

Another measure of investor (over)confidence is the amount they’re willing to pay for a given dollar of public company earnings. When pessimistic they’re not willing to pay much at all, but when convinced by a few years’ of nice gains that they’re geniuses, they’re willing to pay a lot. Currently, according to Gordon T. Long of Macro Analytics, they’re willing to pay even more than in 2007, just before the world almost fell apart.

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Consumer Sentiment

Various organizations like to survey US citizens about how they’re feeling and what they intend to buy in the year ahead. They then cook the responses down to a “consumer confidence” number that analysts use to predict retail sales and GDP growth. As you can see from the following chart (also from Macro Analytics’ Gordon T. Long), consumers have been repeatedly coaxed out of depression by successively larger rounds of money printing, only to collapse back into despondency when the resulting bubble bursts. Each peak has been lower, implying that stimulus is losing its potency. If the pattern holds, the top is in and another collapse is imminent.

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Broadening triangle

This one is from David Chapman, manager of the Millennium Bullion Fund. As he describes it in a recent SafeHaven article:

A broadening triangle pattern is rare and if it does occur it normally is not seen over such a long period of time. This pattern saw its first peak in 2000 (A) followed by the initial bottom in 2002 (B) followed by the huge 5 year rally that topped in October 2007 (C) then the 2008 financial crisis crash (D). The current rally that got underway in March 2009 could soon make its final top (E).

A bearish broadening or expanding triangle would normally break down through the bottom of the triangle and have objectives that could in theory equal the widest point of the triangle. In this case, that would be D to E. This scenario could result in a complete collapse of the DJI. Some technical analysts such as Robert Prechter of Elliot Wave International www.elliotwave.com and Robert McHugh of McHugh’s Market Forecasting & Trading Report www.technicalindicatorindex.com have long been forecasting a potential final top to the current Grand Supercycle and that it could culminate in a huge financial collapse. This appears to fit their model.

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Kesimpulan

Meskipun langkah the Fed yang tidak jadi mengurangi QE, memberikan sentimen bullish pada bursa saham dalam jangka pendek, ada beberapa sejumlah alasan mengapa rasa puas bukan merupakan suatu pilihan,

Saham mengalami overvalued, tingkat bunga naik, pendapatan earning merosot, dan meskipun ada indikasi perbaikan ekonomi jangka pendek, namun dalam basis (tren) data masih negatif.

Tetapi para investor telah mengabaikan fundamental karena itu tidak relevan selama the Fed AS masih terus mempertahankan kebijakan akomodatifnya.

Masalahnya adalah tidak ada yang tahu apa yang akan terjadi nanti, dan asumsi kini dibuat berdasarkan masa lalu.

Dan, seperti yang telah diketahui para investor, bahwa masa lalu tidak menjamin hasil di masa depan.

Terakhir yang tak kalah menarik adalah foto yang dipublikasi oleh Reuters belum lama ini yang merangkum bubble Dot Com kedua :

Nic-40

Terima kasih sudah membaca dan semoga beruntung!

Dibuat Tanggal 07 Oktober 2013

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Apakah Perang Suriah Menjadi Awal Sebuah Perang Besar?

August 14th, 2013 No comments

Why of course the people don’t want war … But after all it is the leaders of the country who determine the policy, and it is always a simple matter to drag the people along, whether it is a democracy, or a fascist dictatorship, or a parliament, or a communist dictatorship … Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is to tell them they are being attacked, and denounce the pacifists for lack of patriotism and exposing the country to danger. It works the same in any country.”

– Hermann Goering, Nazi leader

Perang Suriah nampaknya akan semakin meningkat karena Iran – yang baru selesai melangsungkan pemilu presiden yang dimenangkan oleh kandidat moderat, Hassan Rohani – mulai mengambil alih.

The Independent melaporkan bahwa a military decision has been taken in Iran – even before last week’s presidential election – to send a first contingent of 4,000 Iranian Revolutionary Guards to Syria to support President Bashar al-Assad’s forces against the largely Sunni rebellion that has cost almost 100,000 lives in just over two years.

Iran is now fully committed to preserving Assad’s regime, according to pro-Iranian sources which have been deeply involved in the Islamic Republic’s security, even to the extent of proposing to open up a new ‘Syrian’ front on the Golan Heights against Israel.”

Jika pihak barat yang menghendaki Iran masuk dalam eskalasi Suriah, seperti memburu 2 burung dengan sebuah cluster bomb, maka Iran akan menyambut baik kehendak tersebut..

Tyler Durden dari www.zerohedge.com juga memberikan penjelasan lebih banyak mengenai proxy war di Suriah yang kian memanas, setelah beredarnya berita-berita, yang pertama adalah bahwa Russia bersikeras “it would deliver anti-aircraft missiles to Syria despite international criticism, as fears of spillover from the conflict grew” and in logical retaliation to the decision by Europe to lift an arms embargo to the Al Qaeda-supported, Qatari mercenaries operating in Syria, also known as “rebels.”

Dan berikut cerita lengkapnya, yang menggambarkan dengan sangat jelas bahwa situasi di Timur Tengah semakin serius:

This led Israel’s defense minister Moshe Yaalon to immediately signal that “its military is prepared to strike shipments of advanced Russian weapons to Syria.”

Meanwhile back in the US “the White House has asked the Pentagon to draw up plans for a no-fly zone inside Syria that would be enforced by the U.S. and other countries such as France and Great Britain, two administration officials told The Daily Beast.”

And just to make it very clear that Russia is not bluffing, it announced overnight that its four regiments of S-300 air defense systems have been deployed at the Ashuluk firing range in southern Russia as part of another snap combat readiness check of the Russian armed forces “The missions will be carried out in conditions of heavy electronic warfare to test the capabilities of the air defense units to the highest limit.”

And to think: yet another threat of a global war over some natural gas pipelines from Qatar to Europe, and a threat to Gazprom’s monopoly.

From AFP:

Russia insisted Tuesday it would deliver anti-aircraft missiles to Syria despite international criticism, as fears of spillover from the conflict grew after three Lebanese soldiers were killed in a border-area attack.

Israel warned Russia it would “know what to do” if the delivery went ahead, and Syria’s top rebel commander gave Hezbollah, the powerful Lebanese Shiite movement, a 24-hour ultimatum to stop fighting alongside regime forces.

The developments stoked tensions after the European Union decided to lift an embargo on weapons to Syria’s rebels, in a move the opposition reacted to with caution.

Syria’s regime joined its ally Russia in condemning the EU decision as an “obstruction” to peace efforts, while accusing the bloc of supporting and encouraging “terrorists”.

Moscow said it would go ahead with its plans to deliver the S-300 missiles to Syria, despite international concerns, saying the weapons were part of existing contracts.

“We consider these supplies a stabilizing factor,” deputy foreign minister Sergei Ryabkov said, adding they could act as a deterrence against foreign intervention.

Israel’s immediate response via the Guardian:

Israel quickly issued a thinly veiled warning that it would bomb the Russian S-300 missiles if they were sent to Syria, as such a move would bring the advanced guided missiles within range of civilian and military planes over Israel. Israel has conducted three sets of air strikes on Syria this year, aimed at preventing missiles being brought close to its border by the Lebanese Shia group Hezbollah.

The shipments haven’t set out yet and I hope they won’t,” Moshe Ya’alon, the Israeli defence minister, said. “If they do arrive in Syria, God forbid, we’ll know what to do.”

Russia’s deputy foreign minister, Sergey Ryabkov, argued that the delivery of the S-300 system had been previously agreed with Damascus and would be a stabilizing factor that could dissuade “some hotheads” from entering the conflict. That appeared to be a reference to the UK and France, who pushed through the lifting of the EU embargo on Monday night and are the only European countries considering arming the rebel Free Syrian Army (FSA).

After much deliberations, and unable to find the much needed “weapons of mass destruction” to justify intervention, the US is nonetheless escalating next and Obama is now said to demand plans for a No Fly Zone over Syria from the Pentagon. From the Daily Beast:

Along with no-fly zone plans, the White House is considering arming parts of the Syrian opposition and formally recognizing the Syrian opposition council.

The White House has asked the Pentagon to draw up plans for a no-fly zone inside Syria that would be enforced by the U.S. and other countries such as France and Great Britain, two administration officials told The Daily Beast.

The request was made shortly before Secretary of State John Kerry toured the Middle East last week to try and finalize plans for an early June conference between the Syrian regime and rebel leaders in Geneva. The opposition, however, has yet to confirm its attendance and is demanding that the end of Syrian President Bashar al Assad’s rule be a precondition for negotiations, a condition Assad is unlikely to accept.

In April, Joint Chiefs of Staff Chairman Gen. Martin Dempsey told the House Appropriations Subcommittee on Defense that the military was planning for a range of options in Syria but that he did not necessarily support using those options.

We’re prepared with options, should military force be called upon and assuming it can be effectively used to secure our interests without making matters worse,” he said. “We must also be ready for options for an uncertain and dangerous future. That is a future we have not yet identified.”

And finally going back full circle, Russia announced overnight that its four regiments of S-300 air defense systems have been deployed at the Ashuluk firing range in southern Russia as part of another snap combat readiness check of the Russian armed forces, the Defense Ministry said. From RIA:

The regiments were airlifted on Thursday by military transport planes to designated drop zones where they will carry out a variety of missions simulating the defense of the Russian airspace from massive attacks by “enemy” missiles and aircraft.

The missions will be carried out in conditions of heavy electronic warfare to test the capabilities of the air defense units to the highest limit,” the ministry said.

A total of 8,700 personnel, 185 warplanes and 240 armored vehicles are involved in the three-day exercise, overseen by Col. Gen. Vladimir Zarudnitsky, head of Russian General Staff’s Main Operations Directorate.

Surely all of the above is very beneficial for future global GDP prospects.

Finally, here is the Russian S-300 system causing Qatar gas pipeline plans global democracies so much consternation:

Terakhir yang tak kalah penting adalah Brandon Smith dari Alt-Market blog yang menulis artikel yang sungguh menarik yang berjudul The Terrible Future Of The Syrian War.

Artikelnya ini wajib dibaca oleh mereka yang peduli terhadap kemungkinan implikasi dari konflik yang memanas ini, dan mungkin akan menyebar ke negara lain di wilayah tersebut:

The last war America fought openly through proxy was the Vietnam War. The idea was not necessarily “new”; General Smedley Butler’s exposé on his career as a conqueror-for-hire, titled War is a Racket, uncovered a long history of bloodshed by U.S. government and corporate interests in third world countries designed to destroy sovereign nations and plunder their resources. This was done through the use of mercenaries for hire, military men acting covertly or guerrilla forces with a pre-existing agenda supplied through back channels.

After our defeat in Vietnam, our government set forth on a program of private warfare. The “School of the Americas” was formed, also known as the School of Assassins, in Fort Benning, Georgia.  The combat academy churned out some of the most unstable monsters in third world politics.  The U.S. trained and conditioned agents for violent social change and military overthrow, who were then implanted around the world (mostly in Central and South America).  These agents then initiated war fever in the name of cementing U.S. interests around the globe.  Their horrifying methods were seen as a means to an end.

The sad and disturbing reality is that most wars fought by our country over the course of the past century have not been fought on principle. Instead, they have been fought for profit and for the consolidation of power and oligarchy.

Vietnam was a break in the tradition of secret puppet conflicts, sending the U.S. into the realm of openly admitted proxy. The establishment wanted the American people to know that we were supplying funding and weapons to the South Vietnamese nationalists, meddling in a civil war which had absolutely no bearing on U.S. international relations or domestic policy. The rationalization then was that America had to stop the spread of communism. Ironically, the communists of North Vietnam were a minimal threat compared to the elitist communists within our own borders sitting in positions of political power.

Ultimately, the Vietnam War had nothing to do with fighting communism, and everything to do with manipulating the public into accepting the concept of foreign intervention. That is to say, we were being conditioned to think of interventionism as a perfectly normal U.S. policy.

The war in Vietnam was achieved in stages. First, the U.S. aided then abandoned the government of Ngo Dinh Diem, who was assassinated during a military coup inspired partly by Diem’s despotic mistreatment of the Vietnamese populace. Money was then sent to cement the power of the military junta in the name of countering the rise of the communist North. Soon, weapons and heavy ordinance were being shipped to the South. Then, U.S. “advisors” were sent to train South Vietnamese soldiers.

Full intervention was successfully avoided by the John F. Kennedy Administration until his assassination, after which President Lyndon B. Johnson launched into a full-spectrum U.S. invasion which the mainstream referred to as a “police action.”  This invasion was facilitated by the “Gulf of Tonkin event”, which is now openly admitted by officials of the day, including Robert McNamara, as a false flag incident entirely fabricated by the U.S. government in order to engineer a validation for outright war.  Simultaneously, Chinese and Russian interests began supplying the North, though their involvement never officially led to boots on the ground.

I rehash this history because I think it is important to note that the Vietnam theatre seems to have been recycled in Syria today, though the cast of characters has been rearranged slightly. This time, the U.S. and Europe has supported the insurgency. The government of Bashar al-Assad has been cast as the “villain”. Russia and China are now playing the role of mediators and peacemakers, while the West now sends men like Senator John McCain to throw money and weapons into the hands of a rebellion permeated with members of Al Qaeda, who decapitate and eat the hearts of prisoners on video, and who, last time I checked, were supposedly our enemy.

The process and escalation of the conflict has been very similar to our adventures in Southeast Asia. Money has been openly sent to the rebels. Weapons have likely been covertly sent (evidence suggests that this program was perhaps a part of the reason for the Benghazi incident and subsequent cover-up). Now, certain parties within the U.S., Israel, and the EU have suggested open armament of the insurgency, while destabilization of the region is blamed on Assad by the Western media.  A false flag event seems to have already been fabricated in the form of a chemical weapons attack.  Samples of a particular Sarin gas incident have allegedly been collected by French journalists from the La Monde newspaper, and have been supplied to the UN.

The UN of course has identified the samples as Sarin and has immediately led the public to believe that the Syrian government was involved, though they have been forced to acknowledge that the insurgents may also have access to similar chemical weapons.  My question is, who the hell is La Monde?  Are we really supposed to believe that random embedded journalists with no agenda have supplied the UN with substantial proof of chemical weapons by the Assad regime? Where are these samples?  Where were they taken?  Where is the proof that they were taken during a combat incident?  I smell an Iraqi setup special all over again…

In response to the accelerated armament of what many now consider an entirely fabricated revolution, Russia, Iran, and Lebanon have offered aid to Assad. Russia has supplied Syria with weaponry for years, though shipments have increased in recent months, including a new shipment of S-300 anti-aircraft missiles which has infuriated Israel (Israel has claimed it has no intention to escalate, even thought it has twice used airstrikes within Syria’s borders — their anger over S-300 shipments only shows that they intend to continue such aggression).

Iran has a longstanding mutual defense pact with Syria and has stated that any further direct incursions by the West will result in Iranian involvement (though I think it likely that they are already involved sending arms and advisors of their own). Lebanon has supplied actual ground troops to Assad through Hezbollah. They are aiding the Syrian army in what appears to be a successful campaign against the insurgency. Hezbollah was very effective in repelling an invasion by Israel in 2006, causing the United Nations to step in to provide face-saving resolutions and an excuse for Israeli retreat. I believe their involvement in Syria will be a game changer.

I have been writing and warning about Syria’s potential as a catalyst for an expanded global war for years, long before most people had ever heard of Assad, and much of what I have predicted in the past is now coming true. Whether you believe the Assad regime is good or evil, it is important to realize that our government’s involvement in the region has nothing to do with Assad. This conflict is about setting off chain reactions in the Middle East, and, perhaps, even triggering a world war. You can read more about this in my article “Syria And Iran Dominos Lead To World War.”

Using Vietnam and other proxy wars as a reference, here is how I believe the war in Syria is likely to progress over the coming months:

  1. Heavy weapons will be supplied to the insurgency, including anti-aircraft weapons, leading to increased casualties, especially civilian casualties.
  2. Assad will respond with expanded and deadly airstrikes and ground troops will advance with the aid of Hezbollah.
  3. Iran will begin openly supplying arms, and step up covert supplies of advisors and ground troops.
  4. Russia will increase arms shipments even further, including anti-ship, anti-tank and anti-aircraft missiles in order to dissuade U.S. and Israeli interests from sending their own forces into the area.
  5. Syrian insurgents will begin losing ground quickly. The UN will offer to “mediate” a ceasefire, but this will only be designed to allow the insurgents time to regroup, and for the U.S., EU and Israel to position themselves for attack.
  6. The UN ceasefire talks will be a wash, if they even take place. Israel will begin regular airstrikes in the name of stopping Iran and Hezbollah from interfering in the war, or to stop them from obtaining “chemical weapons.” The strikes will be aimed at Syrian military facilities and Syrian infrastructure. There will be many civilian casualties.
  7. Syria will respond with ground to air and ground to ground missiles. Israeli cities will see far more precise targeting than the scud missiles used by Iraq during Gulf I and Gulf II. Civilian deaths will be much higher than expected, despite common claims that Israeli missile defenses are the most advanced in the world (Israel has never faced the threat of advanced Russian missile systems).
  8. A no-fly zone will be announced over Syria, enforced by U.S. and Israeli planes, along with anti-aircraft batteries.
  9. A violent attack will take place in Israel, likely against a civilian population center (I would not be surprised if chemical weapons are involved). The attack will be blamed on the Assad government, or affiliated allies. It might be a real attack or it might be a false flag. In either case, the result will be the commitment of Israeli ground troops.
  10. I think it highly probable that Israel will be the first Western country to invade Syria. However, their involvement will immediately draw a declaration of war from Iran, and, increased ship movements from Russia, which maintains a strategic naval base off the coast of Tartus.
  11. Israel will be swallowed up in a strategic quandary, and will demand U.S. military action. The U.S. will supply that action. Combat will spread into cross-border battles in countries not directly engaged in the fight (as it did in Cambodia during Vietnam).
  12. China will respond with economic retaliation, dumping the U.S. dollar as the world reserve currency. Russia will respond by reducing petro-product exports to Europe and staging a massive naval presence in the region. From this point, all bets are off…

Now, the temptation here is for one to immediately take sides and to look at this conflict through the lens of “East vs. West.” This would be a mistake. The Syrian government has in the past acted in tyrannical fashion (though much of the latest accusations appear to be propaganda designed to lure the American public into rallying around another war).

Russia is just as restrictive an oligarchy as the U.S. or the EU. China’s society is a communist nightmare state and the average globalist’s aspiration for what they want America to become one day. Iran has many oppressive policies and is certainly not the kind of country I would ever want to live in. The Syrian insurgency is a mixture of immoral and unprincipled death squads and paid covert wet-work agents. The U.S. government is immorally supplying the cash and weapons for them to operate in the name of fighting the same kind of tyranny that is being instituting here at home.

The point is, there are no “good guys” in this story. There are no heroes; only the insiders, the outsiders, and the general public. It has been the habit of the public to ignore most past proxy wars and then flip on the patriotism switch during the rare occasions that American troops are actually deployed. Given time for adequate contemplation (as well as significant American losses), the citizenry eventually turns sour against the paradigm and demands a change. This time, however, there may be no time for such contemplation. I believe that any forward ground action in Syria on the part of the U.S. or Israel will result in a very fast moving global war.

Such a war would seem like insanity, but it serves a vital purpose for certain special interests. It would provide perfect cover for a global economic crash which is about to occur anyway, except in the midst of war, international bankers can divert blame away from themselves. It would provide a rationalization for overt domestic security and the reduction of civil liberties in the name of public safety. It would allow an excuse for a government crackdown on activist groups, who can be labeled “traitors” who aid the enemy simply by speaking ill of government policy. It would give credence to the ideology of globalization and centralized governance. The elites could claim that sovereignty must be erased and all nations must come together under a single banner so that such a “terrible catastrophe” will never happen again.

The war in Syria will not be about Syria. It will not be about the freedom of the people. It will not be about dethroning Assad or establishing democracy. It will not be about defusing violence in the region. Syria will not be the target; we will be the target — our society, our rights, our nation.

America is in the middle of the most insidious consolidation of power in history and Syria is merely a stepping stone in the game. If we cannot maintain our vigilance and allow ourselves to be sucked into the proxy war façade, the elites will get their global conflict with little to no home opposition. The globalists will win, and everyone else will lose.”

Di akhir tulisan ini ada sebuah gambar tentang pasukan Korea Utara yang kelihatannya sedang bergembira ria:

Terima kasih sudah membaca dan semoga beruntung hari ini!

Dibuat Tanggal 14 Agustus 2013

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Di Tengah Harga Saham yang Melejit, Apakah Saatnya untuk Membeli?

August 3rd, 2013 No comments

“As long as the Dow holds above 15,400, I’ll grade the Dow as bullish. But if the Dow falls below 15,400, I’ll refer to the 50-day MA, which stands at 15,209. If the Dow falls below 15,000, I’ll be looking for trouble. The big question that I’m asking is as follows – is the Dow still in its primary bull trend, or is there a change? Again, I’ll remind my subscribers, never mind the opinions and the rumors, we’re dealing with price, and price takes everything into consideration.”

– Richard Russell’s Dow Theory Letters … July 25, 2013

Tyler Durden dari www.zerohedge.com secara singkat beberapa waktu lalu mengatakan, “by now even five-year olds understand two simple things: i) the market is no longer a discounting mechanism thanks to the Fed’s 4+ year experiment in manipulating equities in order to generate a “wealth effect” and ii) virtually all economic indicators are distorted, as such critical measures of economic “health” as GDP confuse credit creation by the Fed with traditional private-sector credit creation (commercial bank loan growth).”

Selanjutnya, Durden juga menjelaskan bahwa, “much has been made of the inflows into US equity markets in the last few weeks with the heralding of The Great Rotation that will lift us to Dow 36,000 and beyond. The only problem with this rather wonderful meme-du-jour (being the only thing left in the asset-gatherer’s armor since bottom-up and top-down fundamentals are nothing but collapsing near-term, hockey-stick mid-term flights of fantasy) is that, as BofAML notes, institutional investors have never (that’s a long time) sold as much stock as they have in the last 4 weeks – as retail has been piling in.

Chart: BofAML

“So it would appear the ‘real’ great rotation is passing the hot-potato of liquidity-driven stocks from the ‘smart’ money to the ‘dumb’ money once again.”

Seperti para trader ataupun investor lainnya, Anda mungkin sedang bertanya-tanya apakah saat ini waktunya membeli atau menjual. Namun jika kita menyimak apa yang dikatakan Michael Snyder dari The Economic Collapse blog, maka perlu sangat berhati-hati ke depannya.

Laporannya tersebut masuk dalam kategori yang WAJIB DIBACA, yang berjudul It Is Happening Again: 18 Similarities Between The Last Financial Crisis And Today:

“If our leaders could have recognized the signs ahead of time, do you think that they could have prevented the financial crisis of 2008?  That is a very timely question, because so many of the warning signs that we saw just before and during the last financial crisis are popping up again.  Many of the things that are happening right now in the stock market, the bond market, the real estate market and in the overall economic data are eerily similar to what we witnessed back in 2008 and 2009.

It is almost as if we are being forced to watch some kind of a perverse replay of previous events, only this time our economy and our financial system are much weaker than they were the last time around.

So will we be able to handle a financial crash as bad as we experienced back in 2008?  What if it is even worse this time?  Considering the fact that we have been through this kind of thing before, you would think that our leaders would be feverishly trying to keep it from happening again and the American people would be rapidly preparing to weather the coming storm.  Sadly, none of that is happening.

It is almost as if they cannot even see the disaster that is staring them right in the face.  But without a doubt, disaster is coming. The following are 18 similarities between the last financial crisis and today…

#1 According to the Bank of America Merrill Lynch equity strategy team, their big institutional clients are selling stock at a rate not seen “since 2008“.

#2 In 2008, stock prices had wildly diverged from where the economic fundamentals said that they should be.  Now it has happened again.

#3 In early 2008, the average price of a gallon of gasoline rose substantially.  It is starting to happen again.  And remember, whenever the average price of a gallon of gasoline in the U.S. has risen above $3.80 during the past three years, a stock market decline has always followed.

#4 New home prices just experienced their largest two month drop since Lehman Brothers collapsed.

#5 During the last financial crisis, the mortgage delinquency rate rose dramatically.  It is starting to happen again.

#6 Prior to the financial crisis of 2008, there was a spike in the number of adjustable rate mortgages.  It is happening again.

#7 Just before the last financial crisis, unemployment claims started skyrocketing.  Well, initial claims for unemployment benefits are rising again.  Once we hit the 400,000 level, we will officially be in the danger zone.

#8 Continuing claims for unemployment benefits just spiked to the highest level since early 2009.

#9 The yield on 10 year Treasuries is now up to 2.60 percent.  We also saw the yield on 10 year U.S. Treasuries rise significantly during the first half of 2008.

#10 According to Zero Hedge, “whenever the annual change in core capex, also known as Non-Defense Capital Goods excluding Aircraft shipments goes negative, the US has traditionally entered a recession”.  Guess what?  It is rapidly heading toward negative territory again.

#11 Average hourly compensation in the United States experienced its largest drop since 2009 during the first quarter of 2013.

#12 In the month of June, spending at restaurants fell by the most that we have seen since February 2008.

#13 Just before the last financial crisis, corporate earnings were very disappointing.  Now it is happening again.

#14 Margin debt spiked just before the dot.com bubble burst, it spiked just before the financial crash of 2008, and now it is spiking again.

#15 During 2008, the price of gold fell substantially.  Now it is happening again.

#16 Global business confidence is now the lowest that it has been since the last recession.

#17 Back in 2008, the U.S. national debt was rapidly rising to unsustainable levels.  We are in much, much worse shape today.

#18 Prior to the last financial crisis, Federal Reserve Chairman Ben Bernanke assured the American people that home prices would not decline and that there would not be a recession.  We all know what happened.  Now he is once again promising that everything is going to be just fine.

Are the American people going to fall for it again?

It doesn’t take a genius to see how vulnerable the global economy is right now.  Much of Europe is already experiencing an economic depression, debt levels in Asia are higher than ever before, and the U.S. economy has been steadily declining for most of the past decade.  If you doubt that the U.S. economy has been declining, please see my previous article entitled “40 Stats That Prove The U.S. Economy Has Already Been Collapsing Over The Past Decade“.

And the truth is that most Americans already know that we are in deep trouble.  Today, 61 percent of all Americans believe that the country is on the wrong track.

It isn’t that so many people are choosing to be pessimistic.  It is just that an increasing number of Americans are waking up to the cold, hard reality that we are facing.

Decades of incredibly foolish decisions have brought us to this point. We allowed our economic infrastructure to be gutted, we consumed far more wealth than we produced, our politicians kept doing incredibly stupid things but we kept voting the same jokers back into office again and again, and over the past 40 years we have blown up the biggest debt bubble in all of human history.

We have been living so far above our means for so long that most of us actually think that our current economic situation is “normal”.

But no, there is nothing normal about what we are experiencing.  We are entering the terminal phase of a colossal debt spiral, and when it flames out the economic devastation is going to be absolutely spectacular.

When the next major wave of the economic collapse comes and unemployment soars well up into the double digits, millions of businesses close and millions of American families lose their homes, I hope that those that are assuring all of us that there will not be an economic collapse will come back and apologize.

There are tens of millions of people out there right now that are not making any preparations at all because they have been promised that everything is going to be okay. When the next financial crash happens, most of them will be absolutely blindsided by it and many of them will totally give in to despair.

Don’t let that happen to you.

What Do the Charts Say?

Lance Roberts dari Street Talk Live blog dalam tulisannya berjudul Is This A 2007 Redux? memberikan pesan yang sama.

Bacalah komentar-komentarnya yang menarik di bawah ini, dan jangan lupa perhatikan pula grafik-grafiknya yang luar biasa:

“I read a very interesting prediction from noted market bull Jeff Saut who, in an interview with Eric King of King World News, stated that:

“For the past two and a half months I have targeted tomorrow, July 19th, as the intermediate-top on both my quantitative timing and technical models. So I think tomorrow is the potential turning point for the first meaningful decline of the year. I have been raising cash for the past few weeks and I think this correction in the stock market will be roughly 10% to 12%.

It’s just a question of, is this thing going to end with a whimper, or is it going to end with a bang? The shorts have been absolutely destroyed here. We could see a blue-heat move that carries the S&P 500 somewhere between 1,700 and 1,730. That would be the ideal pattern, but they don’t operate the market for my benefit so you have to take what they give you.

I don’t think anybody can time the market on a consistent basis, but if you listen to the message of the stock market you sure as heck can decide when you should be ‘playing hard’ and when you should not be playing as hard, and so I’m not playing that hard right here.”

Whether, or not, Jeff is right about the exact date of the market top it does bring attention to the recent correction and subsequent rally to new highs.  Was that correction just a pullback in an ongoing upward bullish trend or is the beginning of a more major topping process much as we saw in 2007?   The chart below shows the price action of the market from 2003-2008 as compared to 2009 top.

The interesting thing about the historical price action is the potential timing of the Federal Reserve’s “tapering” of the current bond buying scheme.  The market advance prior to 2008 which was driven by excess liquidity derived from the credit boom cycle – the current advance has been driven almost entirely by the liquidity pushed into the system by the Federal Reserve.  The extraction of that liquidity could well mark the top of the current cyclical bull advance later this year or in early 2014. (emphasis mine)

It is not just price patterns that have me concerned but rather other similarities between these two advances that should be noted as well.

Leverage

The next chart below is the amount of leverage in the financial system as measured by the level of margin debt.  Margin debt has currently risen to an all-time high during the current liquidity cycle much the same as was witnessed prior to the financial crisis.

As you can see spikes in margin debt, as market exuberance begins to form, generally takes place near market peaks.  The current spike in margin debt to record levels is not necessarily a sign of good things to come.

Valuations

Market valuations have been expanding over the last couple of quarters as prices have been artificially inflated while earnings growth has deteriorated.  The result has been a push of market valuations, as measured by P/E ratios, to levels in excess of those witnessed at the prior market peak.  The chart below shows reported trailing twelve month price-earnings ratios for the seven quarters leading up to the peak in earnings.

While valuation measures are historically horrible market timing devices, especially when the market is being pushed by liquidity, they do give some insight as to extremes.  I should not have to remind you that post the peak in reported earnings in 2007 they fell sharply to a low of just $6.86 per share by March of 2009.  Of course, at the peak in 2007, the economy was growing, there was no threat of recession, housing related issues were “contained” and Bernanke calmly explained that we were in a “goldilocks economy.”  Just six months later the economy was in a recession and the financial crisis had set upon us.   While I am not saying that the same thing is about to happen – what does concern me is the extreme amount of confidence that currently exists that we have once again entered into that same “goldilocks” state.

Earnings

Of course, you cannot really discuss P/E ratios without discussing the trend and trajectory of earnings.  Reported earnings were steadily rising as we entered into the peak of valuations in 2007.   At that time the belief was that market prices would continue to rise along with earnings.  The problem was that belief was quickly shattered as the initial waves of the recession began to set in.   Currently, that same belief is once again largely prevalent. The chart below shows the historical trend of reported trailing twelve months earnings per share versus the stock market.

Despite the fact that earnings have been stagnating for several quarters now; the belief is that at just any moment the economy will kick into gear and earnings will play catch-up with rapidly rising valuations.  This has historically been a losing proposition.  Valuation excesses tend to be mean reverting through a fall in the numerator rather than a rise in the denominator.

Economic Growth

Looking at earnings, valuations and price are all important to whether or not we are currently near a peak in the financial markets.  However, ultimately, it is the economy that will drive all of these issues in the future.  The chart below shows annualized growth rates of quarterly real GDP for the periods of 2004 through 2007 and 2009 to present.

The importance here is that in both cases the actual rate of economic growth peaked near the middle of the economic cycle and then began to wane.  The polynomial trend lines shows this a little more clearly.  Of course, as stated above, despite clear evidence that the economy was beginning to struggle the inherent belief by most mainstream analysts and economists was that the “soft patch” would quickly recover.  Unfortunately, that was not the case.  The impact of the recession in the Euro zone, and the slowdown in China, is clearly impacting corporate earnings and revenue which puts the current market at risk.

Is This A Market Top?

Mr. Saut’s very bold prediction that we are likely making a market top currently is certainly attention grabbing.  The reality, however, is that the current “liquidity driven exuberance” could keep the markets “irrational” longer than logic, technicals or fundamentals would dictate.

Are we likely forming a market top? It is very possible.  We saw the same type of market action towards the last two market peaks.  However, it will only be known for sure in hindsight.  The many similarities between the last cyclical bull market cycle and what we are currently experiencing should be at least raising some warning flags for investors.  The levels of speculation, leverage, price extensions, duration of the rally, earnings trends and valuations are all at levels that have historically led to not so pleasant outcomes. (emphasis mine)

 

John Hussman memberikan kesimpulan yang bagus dalam pernyataannya berikut:

“Given the present evidence, however, my real concern is that much like the rolling tops of 2000 and 2007, each pleasant breeze here lulls investors into complacency – but in the face of overvalued, overbought, over bullish conditions that, from a cyclical and secular standpoint, should probably have them wide-eyed with terror. We can’t rule out that the bough will sway for a while longer despite the weight, but we won’t embrace the situation by putting our own baby on the twigs. It’s quite crowded up there already.”

Jika tulisan di atas membuat Anda lari ke minuman dewasa (baca: berakohol), maka bacalah sejumlah pernyataan berikut ini:

“I envy people who drink – at least they know what to blame everything on.” – Oscar Levant

“Dear Alcohol, we had a deal, you were going to make me funnier, sexier, more intelligent, and a better dancer. I saw the video, we need to talk.” – Anonymous

“It takes only one drink to get me drunk. The trouble is, I can’t remember whether it’s the thirteenth or the fourteenth.” – George Burns

“Alcohol may be man’s worst enemy, but the Bible says love your enemy!” – Frank Sinatra

“A woman drove me to drink and I never even had the courtesy to thank her.” – W.C. Fields

“I have taken more out of alcohol than alcohol has taken out of me.” – Winston Churchill

Terima kasih sudah membaca dan semoga beruntung!

Dibuat Tanggal 02 Agustus 2013

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