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I know we have a few ‘traders’ as VIP Members and for them and anybody else with significant commodities exposure, this letter in the link below from Ann Barnhardt of Barnhardt Capital Management is a MUST-MUST-MUST read…
“The Entire System Has Been Utterly Destroyed By The MF Global Collapse” – Presenting The First MF Global Casualty…
“The futures and options markets are no longer viable. It is my recommendation that ALL customers withdraw from all of the markets as soon as possible so that they have the best chance of protecting themselves and their equity.”
On the same topic … $600 Million MF Global Money Now “Missing” After Reports It Was Sent To JP Morgan
“However, weeks beforehand, billionaire investors like the Koch brothers had the miraculous foresight to withdraw all their money, prompting accusations that big players got a ‘heads up’ in advance of the firm’s collapse.”
[ http://www.prisonplanet.com/mf-global-money-now-missing-after-reports-it-was-sent-to-jp-morgan.html ]
It is more important than ever that your investment strategy is ultra-defensive and, I would strongly encourage all of you to have at least 6 months worth of living expenses (whatever your local currency may be) in cash somewhere real safe…
Scott
What I love is how they are making movies about this financial mess — i’ve seen two in the last week. Margin Call with Kevin Spacy and Jeremy Irons, and Too Big To Fail with John Hurd and some other fairly big names. for the life of me, i can’t figure out why Hank Paulson isn’t in prison, or Fuld, or any of those other crooks who stole everyone’s money. truly amazing. even more amazing is that it’s fodder for hollywood!!!
[quote=”Scott”] “The futures and options markets are no longer viable. It is my recommendation that ALL customers withdraw from all of the markets as soon as possible so that they have the best chance of protecting themselves and their equity.” [/quote]
“The sky is falling, [b]THE SKY IS FALLING[/b].” ~ Chicken Little
I see several problems with this message coming from a financial manager the first of which is in posting the message on the internet rather than in private communication with the clients although this might already have been done.
A public broadcast such as this might be taken seriously and acted upon by investors other than the clients of the poster thereby making a market fall as the result of the advice rather than any weakness in the market although the latter might be true.
A financial advisor, as the title implies, has a fiduciary duty to their clients in knowing the underlying intrinsic value of the instruments in which their clients invest and I can imagine three scenarios that would bring this warning.
1 ~ That the clients invested at a time when there was decent upside potential and that potential has been reached.
2 ~ That the investment was made by a misinformed client in spite of advice against it in which case the advisor should have a signed disclaimer at hand
3 ~ That the investment was a result of advice given when the upside potential was shaky at best simply to gain a commission.
Although I believe the advice is sound it comes quite late in the game as the markets have been over-valued for some time.
This is [b]“déjà vu all over again”[/b] as Yogi Berra once said.
On the heels of the housing bubble/financial crisis we are seeing portions of the investment market becoming severely overpriced in relation to intrinsic value. When home prices exceeded the cost of construction the intrinsic value was exceeded but homebuyers were unaware of the fact and mortgage lenders began pushing creative loans that allowed prices to continue to rise.
As an example, my wife and I purchased a home in California in 1998 for $143,000. The replacement value of the home was $120,000 implying a cost of under $4.00 per foot for the land in a highly urbanized area where bare lots were selling for more than four times the price.
In preparation for my retirement and our move to Costa Rica we sold the home in December 2006, eight years later, for $429,000, exactly three times what we had paid. We could have purchased two lots and built two homes for that amount. Instead we paid off the mortgage and a second home improvement loan, paid cash for our home in Costa Rica and the move to get here.
Our future investments will be made in things that we can touch and see on the property we now own. Luck certainly plays a part in how things turn out.:lol:
I think you may be underestimating the size of the problem here Les…
Comparing the previous financial “crisis” to the derivatives time bomb is like comparing the pimple on a teenager’s face to the Krakatoa volcanic eruption that killed 30,000+ people…
Warren Buffet believes that: “Derivatives are financial weapons of mass destruction.” [ http://news.bbc.co.uk/2/hi/2817995.stm ]
That was in 2003 and it’s a LOT worse now …
It’s only a matter of time before this too explodes in our faces and it ain’t going to be pretty ….
I hope I’m very, very wrong.
Scott
it’s a good thing you sold in 2006 because it was all downhill from there. you were lucky. another couple of years and you would’ve been upside down on your mortgage.
[quote=”Scott”] I think you may be underestimating the size of the problem here Les… [/quote]
Not underestimating the problem just pointing out that we do not learn.
In the late 1990’s brokers kept pushing tech stocks saying they would go up forever and many investors lost their savings.
Beginning in 2002 the homes were exceeding the cost of construction but mortgage lenders pushed “creative mortgages” and convinced homebuyers that they could afford them. Banks went bankrupt, financial institutions had to be bailed out and many families lost their homes. All of this will be paid for on the backs of a diminishing middle class that cannot find employment
Now a warning that futures and derivatives are priced beyond their value. Where will it end this time?
Wealth is a stable commodity relative to inflation and someone somewhere is gathering that wealth at the expense of the masses because we do not understand the underlying value of those things in which we invest.
Now the question is are we being stripped of all we own by a few or is it because we are too stupid to do basic research and understand the true value of things.
When we are gulled by someone else we blame them but the real problem is that we allowed it to happen.
If you follow your link and then scroll down past Ann Barnhardt’s letter, you will come to a couple of links from You Tube in which Ms. Barnhardt is engaged in a full anti-Muslim rant while waving a Koran which she has bookmarked with bacon strips, tearing pages from it and burning them. She also boasts that she did this while giving her home address and states that they (Muslims?) can come and get her but should be beware as she is better armed than the French Army. I think Warren Buffett is a better source concerning the danger of derivatives.
[quote=”Scott”]I know we have a few ‘traders’ as VIP Members and for them and anybody else with significant commodities exposure, this letter in the link below from Ann Barnhardt of Barnhardt Capital Management is a MUST-MUST-MUST read…
“The Entire System Has Been Utterly Destroyed By The MF Global Collapse” – Presenting The First MF Global Casualty…
“The futures and options markets are no longer viable. It is my recommendation that ALL customers withdraw from all of the markets as soon as possible so that they have the best chance of protecting themselves and their equity.”
On the same topic … $600 Million MF Global Money Now “Missing” After Reports It Was Sent To JP Morgan
“However, weeks beforehand, billionaire investors like the Koch brothers had the miraculous foresight to withdraw all their money, prompting accusations that big players got a ‘heads up’ in advance of the firm’s collapse.”
[ http://www.prisonplanet.com/mf-global-money-now-missing-after-reports-it-was-sent-to-jp-morgan.html ]
It is more important than ever that your investment strategy is ultra-defensive and, I would strongly encourage all of you to have at least 6 months worth of living expenses (whatever your local currency may be) in cash somewhere real safe…
Scott[/quote]
[[quote=”hakesp”] I think Warren Buffett is a better source concerning the danger of derivatives.[/quote]
[quote=”Scott”]I know we have a few ‘traders’ as VIP Members and for them and anybody else with significant commodities exposure, this letter in the link below from Ann Barnhardt of Barnhardt Capital Management is a MUST-MUST-MUST read…
It is more important than ever that your investment strategy is ultra-defensive and, I would strongly encourage all of you to have at least 6 months worth of living expenses (whatever your local currency may be) in cash somewhere real safe…
Scott[/quote]
I think a good read can be found at [url=http://www.investopedia.com/articles/optioninvestor/08/derivative-risks.asp#axzz1eXljbTmo]Are Derivatives Financial “Weapons Of Mass Destruction”?[/url]The article contains a short history of the derivatives and comments by Buffett and Greenspan as well as some of the dangers in the derivatives market. It also includes what can happen when the criminal mind becomes involved in selling derivatives.
Scott, your advice is sound. The first priority for anyone should be for the immediate future
I received an article which pointed out that the MF Global failure may have been a hit done by the Powers That Be in order to shake loose commodity speculators who kept pumping up the price of gold and silver. The Fed has an interest in seeing precious metal prices suppressed. Firstly, one of the Fed banks, Chase Bank, has a huge short position on silver and, secondly, the dollar’s inherent lack of value is brought to public light as silver and gold keep rising to what their prices should be. Thirdly, there simply may not be any gold to pay out to these speculators, many of whom were going to take delivery of physical gold at the end of the year.
Gerald Celente, one of the people who had his segregated account raided by these bankers, is predicting that we will see a bank holiday shortly after the first of the year. He is advising everyone to remove all cash from banks and 401K accounts and leave only operating capital in the accounts. Yeah, this is big. And anyone who is pooh poohing this as inconsequential may be in for a nasty awakening soon.
[quote=”sprite”] I received an article which pointed out that the MF Global failure may have been a hit done by the Powers That Be in order to shake loose commodity speculators who kept pumping up the price of gold and silver. The Fed has an interest in seeing precious metal prices suppressed. Firstly, one of the Fed banks, Chase Bank, has a huge short position on silver and, secondly, the dollar’s inherent lack of value is brought to public light as silver and gold keep rising to what their prices should be.[/quote]
The price of gold was set at $35 per ounce in 1934. If you calculate inflation since then, up 290.6% and set the value of gold accordingly it would be worth more than $10,170 per ounce rather than the $1,700 to $1,800 it is currently.
The price of precious metals has been manipulated by speculators since 1972 keeping them artificially low.
“The London gold fixing or gold fix is the procedure by which the price of gold is determined twice each business day on the London market by the five members of The London Gold Market Fixing Ltd, on the premises of N M Rothschild & Sons.” [ http://en.wikipedia.org/wiki/Gold_fixing ]
In 1790 Mayer Amschel Rothschild said: “Let me issue and control the nation’s money and I care not who writes the laws.”
In 1815 Nathan Mayer Rothschild stated: “I care not what puppet is placed upon the throne of England to rule the Empire on which the sun never sets. The man who controls Britain’s money supply controls the British Empire, and I control the British money supply.”
In 1869 at the funeral of Grand Rabbi Simeon Ben-Iudah, Rabbi Reichorn says that: “Thanks to the terrible power of our International Banks, we have forced the Christians into wars without number. Wars have a special value for Jews, since Christian massacre each other and make more room for us Jews. Wars are the Jew’s Harvest, the Jew banks grow fat on Christian wars. Over one hundred million Christians have been swept off the face of the earth by wars, and the end is not yet.”
Any questions?
[quote=”Scott”]”The London gold fixing or gold fix is the procedure by which the price of gold is determined twice each business day on the London market by the five members of The London Gold Market Fixing Ltd, on the premises of N M Rothschild & Sons.” [ http://en.wikipedia.org/wiki/Gold_fixing ]
In 1790 Mayer Amschel Rothschild said: “Let me issue and control the nation’s money and I care not who writes the laws.”
In 1815 Nathan Mayer Rothschild stated: “I care not what puppet is placed upon the throne of England to rule the Empire on which the sun never sets. The man who controls Britain’s money supply controls the British Empire, and I control the British money supply.”
In 1869 at the funeral of Grand Rabbi Simeon Ben-Iudah, Rabbi Reichorn says that: “Thanks to the terrible power of our International Banks, we have forced the Christians into wars without number. Wars have a special value for Jews, since Christian massacre each other and make more room for us Jews. Wars are the Jew’s Harvest, the Jew banks grow fat on Christian wars. Over one hundred million Christians have been swept off the face of the earth by wars, and the end is not yet.”
Any questions?[/quote]
Before I condemn one race or creed over the other, I have a question. Actually, I have a few questions;
Who is doing the actually killing by putting on uniforms and badges and pulling gun triggers?
Who flies the planes dropping bombs?
Who continues to elect the same lying traitors to government year after year?
Who continues to fund a murderous government with their obedient compliance to tax regulations?
Who is kneeling down in the shadow of all these evils out of fear?Frankly, I don’t care what religion, nationality or race makes up the majority of the elites in control. If there is one belief system or religion or creed behind the raw urge to control and rule by force, I don’t care. Whatever that belief system is, it is human and it is not unique. What matters is the system used to achieve dominance. That system has to be dismantled.
[quote=”Scott”]
In 1869 at the funeral of Grand Rabbi Simeon Ben-Iudah, Rabbi Reichorn says that: “Thanks to the terrible power of our International Banks, we have forced the Christians into wars without number. Wars have a special value for Jews, since Christian massacre each other and make more room for us Jews. Wars are the Jew’s Harvest, the Jew banks grow fat on Christian wars. Over one hundred million Christians have been swept off the face of the earth by wars, and the end is not yet.”
Any questions?[/quote]Scott, quoting a Jew making racist remarks doesn’t make you immune from being called a racist yourself. This forum takes on such a wacko slant at times.:?
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