Tag Archives: Inflation

by | January 31, 2014 · 1:34 pm

Market update

Nikkei ended down to a 2 1/2 month low, while the yen rose. It`s very mixed in Asia. Some red and some green numbers, but in Europe it is different. They are all down and they are very red on emerging market worries. Gold is up +0,52%, trading at $1248,60.

This is how it will be now I think. Up and down. A volatile market. Right after the FOMC statement, we saw the market went down, but there was no panic. The volume was low and the U.S market went up yesterday. Today, It seems like the U.S market will start in a red territory.

It is the last day of January today, and it is headed for the worst january in Europe since 2010. What I will focus more about now is inflation, stagflation and deflation. Printing a lot of money should lead to growth and inflation.

But so far, we see a slow growth, low inflation and worries about deflation. There are two camps out there. One that expect inflation (some predict hyperinflation) and one camp that expect deflation. Who are you gonna listen to?

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication

 

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by | January 28, 2014 · 2:14 pm

BIG Apple

The stock markets are sliding down but this is not the end of the world. There ain`t no doubt; the bear is here! Yesterday Nasdaq tumbled -1,08%, while Apple plummeted -7,7% in after hour trading. Dow slid -0,3%.

This is how it probably will be in the stock market now. Up and down, or what we call a volatile market. That`s why it is so important to know about stock picking. How to pick the right stocks, and that`s why I wrote about it last week.

In my opinion; U.S stocks is not cheap, so it is important to know what to do before any decision is made. The European stocks is twice as cheap as the U.S stocks. How is it going with Apple?

Apple reports yesterday:

iphone sales is $32,5B (+6% vs 17% in FQ4).

ipad sales is $11,5B (+7% vs -13%).

Mac sales is $6,4B (+16% vs -15%).

iTunes/software/services revenue is 4,4B (+19%).

iPod sales is only $973M (-55%).

78% of Apple`s cash/investment balance ($159B) is offshore. The iPhone sales is up +40% in Japan. Sales in China is up 20%. Europe is flat, while Americas sales is only +1%. Tim Cook didn`t say much about buybacks in face of Carl Icahn`s ongoing campaign. $7,8B was returned via dividends/buybacks. Apple need to release something new now, and I am not talking about a bigger screen or a different color. I am talking about innovation. Come On Apple: “think different”.

Revenue: $57,59B

FQ1 EPS: $14,50

Expects FQ2 revenue of $42 – $44B.

How is the inflation? It is rising, but it is difficult to see it. Some people expect inflation and some expect deflation. Both camps see increase in general prices like visible money and credit prices. Hyperinflation is expected, but deflation is probably the biggest problem in the future in the long run. I think Janet Yellen will push the QE-button if the deflation ghost is here. As you can see; despite the QE programs, the growth is so far very slow.

If the Fed starts its tapering, how will that affects the emerging markets? Half of the global GDP comes from the emerging markets, and that moves the other markets in the rest of the world.

It seems like money is on the way back to emerging markets as the Fed announces their tapering. Let`s wait for the FOMC statements later on this week.

Reports today: Core DurableGoods at 8:30am, S&P/CS Composite at 9:00am, CB Consumer Confidence at 10:00am.

Apple

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication

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by | January 7, 2014 · 1:46 pm

Buy Gold or not

U.S. equities traded lower for the third consecutive trading session in 2014. This is the worst start for stocks since 2005. Nikkei was trading down for a second day on Tuesday. European stocks is going in the opposite direction. All the European indices is green right now.

The predictions about gold is mixed. Some hedge funds are buying gold now, and they are very bullish on this precious metal. Other market makers are bearish and say the price will fall down to about $1000.

Goldman Sachs in New York expect the gold price to decline to $1050 at the end of this year 2014 (report from Nov. 20). Gold prices increased from December 2008 to June 2011 as the Fed expanded its balance sheet through debt purchases. The interest rate was low and it was in a U.S recession. They did all this because they wanted growth. The record of the Bullion was $1,923,70. A record reached in September 2011.

We are probably at a crossroads here. Fed will start to purchase bonds to $75 billion (from $85 billion) this month. The Fed will try to reduce its QE in $10 billion increments over the next 7 meetings. The program will hopefully end in December.

It is probably best to sit and wait and have a look at the inflation before any decision on gold is made. The precious metal is still trading above $1200 which is a strong support.

News today: Trade Balance at 8:30am.

gold_price_wobbles_as_liquidation_intensifies

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | October 23, 2013 · 12:27 pm

Alan Greenspan talks

Asian markets are down today. Hang Seng is down -1,36%. Nikkei -1,95%. KOSPI -0,99%. Shanghai -1,25%. All the European markets are down today. Everyone is red. Markets are falling, and Yen strengthened against the dollar following a bad miss for U.S employment data yesterday. It drops on concerns about central-bank tightening and debt write-offs at banks.

ECB plans to stress test 128 top eurozone banks over the next year and ECB intends to complete the testes by October 2014. ECB plans to stress test 128 top eurozone banks over the next year and ECB intends to complete the testes by October 2014. It aims to build confidence in the financial sector by improving transparency and implementing “corrective action” where needed.

Mr. Alan Greenspan is out with a new book, worries about the U.S economy. In his latest book, “The Map and the Territory,” he is talking about a warning to the FED balance expansion that may unleash inflation. We can see a price acceleration with today`s FED`s balances unchanged, ranging from 3% per unnum to double digits over the next five to six years, he writes.

Nobody have talked about a higher inflation, but instead the inflation has been on a record low level. That`s why Mr. Alan Greenspan is worried. The FED can prevent this threat by selling the bonds, and take the money back and out of the economy.

But; the FED are confident in plan 2: The FED pays interest on the money that the banks hold on deposit, and when the economy is getting better, the FED can increase the interest rate to induce the banks to hold the money on deposit. That can eliminate the inflationary pressure.

If the economy unexpectedly moves to go wild on a high gear, any credit tightening will run into political opposition. We have seen that before. It is also possible that the inflationary pressures won`t build until the economy has gone into a higher gear. It is possible for the FED to stay against inflationary and political pressures at the same time if the FED do their job right. News today: Import Prices at 8:30am, Crude Oil Inventories at 10:30am.

Alan Greenspan

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | September 23, 2013 · 1:25 pm

Suicidal money-printing and inflation

Investors must find asset classes which must appriciate in value at a greater rate than the spiraling inflation from the printing money programs. One thing investors seek to do in bad times is investing in gold and silver. Humaity`s shield against predatory inflation and crime.

If a company print more shares, then the price of the shares will plummet. Let`s say you have shares in a company that prints more and more shares, the shares you have will at least be worthless. You will start to sell your shares as soon as possible, before it`s too late. If the banks do the same, like printing more money, the fiat currency must plummet in value (puchasing power). This is inflation!

We saw this hyperinflation in Weimar Germany. It is possible to delay its effects, but never possible to prevent this money printing from destroying the value of its own paper. At the end; it worked for Weimar republic! The banks now continue to ramp-up at an exponential rate. Banks in Europe use words like «unlimited» and banks in US use words like «open-ended».

We know the banksters must destroy their own fiat currency, and when they do, the value of these precious metals will probably not increase in value? This is something we need to have in mind. Currency dilution is not a theory. It is a simple relationship of arithmetic.

Most of the novice of investors understand the consept of dilution when it comes to shares in a company, but none of them understand exactly the same thing that is going on in the fiat currency market. Currency-dilution is the same as share-dilution in virtuelly every respect. Keep that in mind.

Have a look at the Fedeeral Government Debt and Primary Budget Surplus, 1912 – 2012 (percent of GDP);

Fed debt

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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