Financial topics

[Higgenbotham]

What I think is that the bond and stock markets are all saying the same
thing. As long as there are various forms of "stimulus" going on,
the money will flow into "safe" investments, like U.S. stocks and bonds,
German bonds, Danish bonds, and out of "unsafe" investments,
like Spanish and Italian bonds.

This reminded me of something that I read in the past few days. I can't remember which day or where. As the Spanish bond yields began to rise back toward 7 percent last week, German bond yields also rose. This alarmed a few people because they realized the "safe haven" door in the entire continent of Europe is closing.

There are a few "safe" investments left but they appear falling by the wayside one by one. US stocks are still 5% below their April highs. I'm noticing just lately that the 10 year US bond is rising a lot more than the 30 year US bond on days that the bonds are being bought, though both remain close to very long term highs.

A few months ago, we were saying if the whole world bails each other out to the point of making all the world bond markets equally undesireable, the entire worldwide bond market will collapse all at once. I don't think that will happen worldwide, but with the steps Germany is looking to take, it is starting to happen in Europe.

[John]

This reminded me of something that I read in the past few days. I can't remember which day or where. As the Spanish bond yields began to rise back toward 7 percent last week, German bond yields also rose. This alarmed a few people because they realized the "safe haven" door in the entire continent of Europe is closing.

I don't remember the exact details either, but it went something like this:
There was sudden concern that "eurobonds" or something similar
would be adopted, and that caused investors to sell Bunds. But then
Merkel and the Germans quashed the rumors, and Bund yields
fell again.

John

[Higgenbotham]

That's scary.

RC's story is the scariest thing I've read in a long time. Great info. I've been told similar things with respect to small business for months but we all know small business is suffering.

My micro story for today is I went out to pick up a few items and everything was on sale. 5 store brand double blade shavers for a buck. Labeled $3.47, then $2.47, then $1. I asked the cashier, are these really $1? They were.

[Higgenbotham]

I don't remember the exact details either, but it went something like this:
There was sudden concern that "eurobonds" or something similar
would be adopted, and that caused investors to sell Bunds. But then
Merkel and the Germans quashed the rumors, and Bund yields
fell again.

John

A thought I'd have on that is the Germans will push the envelope until the bond market begins to revolt. So we may have seen our last bailout come out of Europe. My thought has always been that the Germans will kick the can until they realize kicking the can one more time could cause the bund to collapse. But with this last round, I've wondered if that would even stop them.

[John]

I agree. I believe that before this is over, Germany will cave completely
on every point -- but it will be too late.

John

[Higgenbotham]

http://kingworldnews.com/kingworldnews/ ... lapse.html

Brief summary of an interview with Nigel Farage which I think includes all of the known roadblocks to getting the ESM off the ground.

[aedens]

The reasons don't concern you, only the conditions. Do you want the deal or not?

[vincecate]

That's scary.

RC's story is the scariest thing I've read in a long time. Great info.

So I am going try to contribute something from my experience. The way that I think most of the cash for gold people are moving gold around seems to be breaking down as far as going from outside the US into the US. Part of why I refine my own gold and make and sell coins was that I was skeptical that the method for moving gold would keep working as gold got higher in price. There is a chance that the supply of gold coming from around the world to the gold ETFs and other investors may be slowing down because of this, which might cause the price to go up. There is also a chance that I have one of the few refineries in my part of the world and am about to expand my business. Those that can accurately predict the future often do well.

[aedens]

May 1998 it was said "I believe that actual business cycles aren't always real business cycles, that some (most) recessions happen because of a shortfall in aggregate demand. I and most others have tended to assume that such shortfalls can be cured simply by printing more money."

[aedens]

“Even people that we’d characterize as more financially astute aren’t necessarily professional money managers.”