Economic Trends and Bends... Stock Watch... College Football Results...

Stock Market Trends and Bends...
Gold reached another 52 week high today, and silver moved in close concert. Metals in general have been on the move as more and more countries speculate on the death of the dollar. There is a concerted effort among several nations to stop using the dollar as the world's reserve currency. Oil of course would be the first item switched. This fear alone has caused a dramatic rise in oil and precious metals. But, I would like to warn readers that there is another part to this scenario. Let's just call it the "what if" scenario. What if the Federal Reserve decided to raise interest rates in a rapid succession... to give the dollar legs once again. What if, the world government's move to abandon the dollar goes afoul, and there is no other currency that can be used as effectively. What if the Fed, in some way, shape , or form is able to reign in inflation without leaving the debtor nations holding shopping bags full of useless American dollars. This is not so much a warning, but more or less an argument as the Devil's Advocate and why the dollar is... and still remains the world's reserve... and why gold could be ready for a correction.

But let's face it. There are a lot of problems the United States must work out before the dollar regains its good as gold status. To think that the like of FDR, and Truman worked like the Dickens to make the dollar the envy of every nation, only to let it crumble under the weight of excessive debts and entitlements that would make anyone dizzy... Congress as well as every American should be put on notice... This is not a good thing!!!

Several years ago I looked at a couple of rental properties. I liked the idea of owning a piece of land... having someone else pay ti off for you... and of course the tax write-offs. Yet, the more I looked at rentals, the more I noted that many of the "deals" that were out there would have me supplementing the renter's property. This is not good. I think the government is the only entity that has found supplementing someones property a good idea. And trust me, I don't have deep pockets like the government. If a rental deal was to be had, then I believed that the property had to (at the bare minimum) stand on its own two feet. It if could not meet that basic requirement, then it was not an investment nor and investment.

I bring up this anecdote because it appears that the government has embarked on a variety of programs. Each and everyone discourages people from standing one their own two feet. From TARP, TALF, Cash for Clunkers, stimulus packages, and health care public options... in almost every scenario we are heading down a path that discourages people to take care of themselves. Instead, we are creating more and more of a nanny state. My point is quite simple. At some point in time in the future the government will have to remove many of the stimulus programs. And the economy will have to stand on its own two feet... and if it is not able to do so, then we have in many ways caused a degree of our own long-range problems.

The super-rich... those who have $500,000,000.00 in assets or above are feeling a bit of discomfort these days as well. Before you start to laugh, he are reminded that America needs a rich class. the are often the course of financing and innovation that stimulates the rest of the economy. However, it appears that the rich are particularly worried about government intervention in the financial system in general, and the impending commercial real estate downturn. Many of these lovelies are thinking of playing it safe these days... thinking more like middle class people and not like the meat-eaters that created the original wealth. Regardless of whether you like this class of folk or not, we need them... their greed... and their innovation to keep capitalism alive and well in the united States.

Stock Watch

Let's start with the loser...
LVS is now down 20% from my original purchase price... yet as I expected the stock to get punished once again, I noted that the put options were unchanged today. This suggests that many other market players are looking for a sell-off between now and the end of the month.

PQ has been the story of the month thus far. In after-hour trading PQ breached the 7.00 mark driving the 1/7.5 calls toward grand-slam territory. The real question I may have is whether to make the money and run... milk the time-frame of the calls out a bit more... or even exercise on the options... If I choose the later, it will require a small fortune... and balls of steel to ride this one out. If... if this scenario were to playout, I wouldn't need a visit from Santa at Christmas... and rest assured, the Salvation Army would get a little gift from me in their kettle!!!

College Football...
2-1 is nothing to beat your chest on. However, after the pathetic run I have had, I will take it. This runs my current season record to 6-11... If I was in Vegas playing those games, I might be looking for the casino to give me a complimentary bowl of soup...