Shenandoah

The Three P’s To Watch for….

In the weeks and months to come, there are 3 P’s to watch for both from the bear side and the bull side.

The bull side as far as metals consists of:

Progression - The steady increase of demand by institutional, government and major investors of precious metals and other commodities.

Public Participation - When you see the local newspapers cover stories of “hairdressers and taxi drivers” pawning everything and selling anything to “buy gold and silver” that’s when you know the frenzy and insanity has begun. This happened in the late 1970’s and up to 1981-82 and will again.

Panic - When the price of precious metals goes parabolic, and I’m talking $100 plus per day moves in gold, with panic buying by institutions and average schmucks, we will be nearing the end. I do not see that until gold is above $1650 per ounce and the inflation rate is finally acknowledged as above 4-5% per month.

The bear side of bonds and equities consists of:

Ponzi - The recognition of various investment schemes by the MSM and public as “excellent” investing opportunities (derivatives, hedge and mutual funds anyone?).

Public Participation - The major sell off or so-called “crash” of 10-15% in equity prices and bond prices will be considered as a “buying opportunity” by all the “experts” and will be promoted as the last great chance to get in on a good thing.

Panic - When the entire world and investing public realizes the 10-15% crash in equity prices might actually turn out to be a 30-50% actual crash and then all head for the exits at the same time. There is a new paradigm this time though. If we have stagflation, it’s a 30-60% decline. If we progress to a severe recession with inflation, beyond stagflation, the normal correction range is 50-75% of all the markets.

The difference this time? Our society will change forever as we obliterate the savings of over 60 million baby boomers and enslave our nation to the Chinese model in a feeble attempt to rebuild our imploded economy.

9 Reasons Why the Republicans Will not Win the White House in ‘08

by John Galt
October 10, 2007

I realize that I’ve been away on business this week and thankfully, tomorrow is my last day of travel. However, I have a LOT to say and will try to sputter, spit and not swear but spew it all out as soon as I can. This recent “debate” with the roving RNC circus is no better than the DNC circus and why? As the little old ladies loved to say:

“Where’s the Beef?”

So here are the 9 reasons we will not have a Republican in the White House unless a miracle occurs between now and the convention.

1. Rudy Gulliani - A pro-abortion rights, anti-gun, and fuzzy illegal alien lover running in the deep South? Uh, he might carry two cities, but he wont’ carry any states. He’s too liberal, too northern and too untrustworthy (don’t ask me, ask his ex-wives) to ever win the office. He’s praying that a city gets nuked, that’s his only chance to become President.

2. Mitt Romeny - Ugh. Another Northeastern Liberal attempting to “act” conservative. Gang, this guy promoted and crowed his quasi-socialized medicine insurance program for his home state. Add in the fact that he said he would consult his “lawyer” about attacking Iran instead of the Joint Chiefs of Staff, and that just illustrates a total lack of leadership. Sorry Mr. Glenn Beck, this joker sucks. And last time I checked, the deep South did not vote for the DNC version of Flip-Flops from Massachusetts, so I doubt seriously the RNC version will ever play much better.

3. Fred Thompson - Aka. “Mr. NoDoz” (pass me some more). The fact he seems disinterested or without any passion is one thing. The fact he voted against the impeachment of Bubba is another. Then add in he never met a lobbyist he didn’t like nor a spending bill for that matter and this actor will return triumphantly to prime time television sooner rather than later. Maybe he can reprise his role as a Senator on a new TV series.

4. Mike Huckabee - I heard his interview on Glenn Beck and besides his indecisiveness on many issues along with the “I’d have to think about it” or “I’m not sure I have an opinion” on this or that, and we have another promising Governor who just doesn’t get it. While his “values” are great, his projection of uncertainty is not what is needed at a time when we could get nuked by terrorists or our trading “allies” at any moment.

5. Ron Paul - A great guy. Intelligent. Smart as a whip on the economy and the original intent of the Founding Fathers. Dumb as a rock on foreign policy. His pronouncements show a short-sightedness which has always cost Libertarian candidates and illustrated why America is getting closer to the majority becoming an isolationist walled in nation of frustration. And civil war. Ron, if I could clone your other opinions with those of Ronald Reagan, we would have a prayer of a chance. But the lack of candor in facing the Islamofacist threat make you too risky to vote for this time around.

6. John McCain -

That’s right he’s the Mexichurian candidate. The most annoying voice on television, like those nasty little dogs which whimper, whine and make that hideous bark which pisses off 99.9% of all dog owners and make some pray that a real dog eats it for dinner (like a German Shepard). His stances on violating the Constitution with campaign finance reform to the absurdity of his love of illegals makes him dangerous, untenable and someone that needs to have the “if found please call 555-1212 to return to Senility Home” note pinned to his shirt as he’s dropped off at the dog track every afternoon.

7. Tom Tancredo - One issue won’t win any elections, even though his one issue is of critical importance. Too bad he just has to overcome the financial power of the S&P 500, the Forbes 500 wealthiest and every liberal in the United States and world to win.

8. Duncan Hunter - Sniff out his past a bit. His stances are great. His reality another. His family, though, has lots of comfortable jobs. Employed on the government dole he rails against. I wonder if his grandkids can birth another dozen “consultants” into the D.C. realm.

9. Sam Brownback - You know the last guy drafted during the NFL Draft each year?
Meet the RNC verison of “Mr. Irrelevant”…..

There you have it. 9 disasters. No winners. All trouble. The DNC version is 1000 times worse and once again, America has the “lesser of two evils” election in front of it. I was really hoping a leader would emerge. Any leader. A Reagan, Ike, anyone, to save us.

When she raises her right hand in 2009, remember this little rant.

America, again, could have done better. Once again, we are screwing the people, the world and worse, the U.S. Constitution.

Ugh.

Tonight on the Q-files 10/12/07

It’s a repeat gang…unless Steve Q. elects to go on live. The wife has been gracious enough to take me out for dinner.

Next week though, wow, will I have a bunch to chat about……

Painting the Swan

By John Galt

For the uninitiated, I am a historian by training and hobby, an op-ed writer and blogger by habit. Yes, to many this is a bad habit like smoking a pack of Camels per hour, but I continue to persist in this endeavor to harass the naysayers and those on the cruise ship sailing into disaster on the Denial River. After reading “The Black Swan” by Nicholas Taleb, one has to reflect on years ending in ‘7’ and the unfortunate habit of October being the month of financial doom for the equity markets. If you look at the build up of bad news, the absolute fallacy and price inflation along with the obscene cheer leading with false news and rumors to pump and dump the markets up on the average schmuck investor, it makes rational people think “where’s the crash”. The heck with “rational people” the technicians are befuddled also, as every indicator flashes “Danger Will Robinson, Danger” when reviewing the charts and listening to their commentary. The reality is that the introduction of a “Black Swan” event seems to be the catalyst everyone is waiting for to cause a market decline. Yet day after day, hour after hour, the white swan of stability swims in the equity pool side by side with the bulls.

“What me Worry?”

Logically speaking, if any one of us follows the day to day gyrations of gold, the dollar and the credit markets we should be in absolute and total panic by now. The price of oil should be sending the consumer into their bunkers and Santa Claus into abject panic as everything the kids ask for has been recalled because those evil Chinese Communist elves cut costs and use all that lead paint we left over in China during World War II. But the Alfred E. Neuman market continues to attain new highs, where bad news is good, good news is good, and no news is good. Where strikes by auto workers, Israeli Air Force bombing attacks in Syria, and a Congress looking to raise taxes on anything that’s a mammal have no effect on equities. The “what me worry” approach to investing seems logical faced with the what else are you going to do with those worthless dollars and your mutual fund theory of investing, but the fear the Fed will quit cutting rates and undercut the market momentum hangs out there. So how do the big banksters and investment houses insure that somehow, some way, the cheap money keeps flowing, the dollar and those baby boomers be damned?

Break out the Spray Paint

In the theories of random chaos or random event occurrence, it seems that the market psychology is to ignore these events and gloss over them in the hopes that the average investor and especially the foreigners do not get upset and start closing accounts and cashing out. Since the idea of suing for fraud has pretty much been laughed out of the courtrooms and the politicians are bought and sold by these prim and proper business folks like you and I change our shorts, the idea of painting black swans white has been the practice, whether via the idea of news suppression or the concept of “creative accounting” to prevent crashes from happening. After all, we can not upset the masses who need to maximize their level of debt so they can keep buying more stuff they can not afford and retire into programs which promise huge payouts when they turn 65, even thought the dollar will practically be worth 75% less by that time. This brings me to a disturbing but quite potentially realistic theory on the next two weeks; the most dangerous I have seen in these markets since October 1987. You see, there is a lot hinging on the continued idea of a Federal Reserve rate cut on October 31^st. The bettors who call themselves brokers are convincing themselves and everyone else that all the banksters will hold hands, sing songs and cause the karma to cut rates. As well as the fact they promised Ben cheap gas for his chopper to insure a successful money drop. The snag in this theory occurred of their making though, in the last three weeks.

They Believe Their Own Fake Numbers

The title above is neither incorrect, nor a work of fiction, but a frightening reality. The Federal Reserve banksters have made recent statements to indicate that the phony numbers published by the BLS are believable and maybe, just maybe, they were a tad bit overzealous about cutting rates that much in the last meeting. In reality, by committing this act of dollar suicide, they bailed some banksters out with their arbitrage investments they have perfected using the Yen carry and other exotic trades, but in no way did this stop the real estate bleeding which is just beginning. In fact it did more to aggravate the long term interest rates and cause them to skyrocket than to moderate the A.R.M. resets or velocity of foreclosures in the pipeline. Along with the involuntary foreclosures, there is little public data to indicate the severity of failed land deals, voluntary surrenders or commercial defaults which have impacted the bankster’s bottom line. This means the Federal Reserve actually has to talk to its member banks and the hedge funds to get a feeling of panic. Yet the public pronouncements on Bubblevision have done little to calm the backroom hysteria still under way. You can only put so much lipstick on that pig before the squealing gets too loud and right now, that’s one ugly cherry lipped pig screaming “cut” right now.

Unfortunately, political reality has met financial reality in the Fantasyland Hotel and the ugly pig they birthed has mired their flexibility in a quicksand of lies. The politically approved and motivated numbers have to indicate a growing economy with low unemployment and inflation to insure the election year disaster facing the incumbent party is mitigated and controlled so the election is not another “it’s the economy stupid” moment, which would spell disaster for the Republicans. The financially fallacy side of the trade is just as devious, as they can not report super negative numbers in their financials to induce a panic prematurely until the hedgies and ultra wealthy nations and clients have had time to reposition their assets in safer instruments. The obvious clashing of the two lies has had the effect of neutralizing and paralyzing the markets into moving on thirty stocks or big caps and little else. The financial reporting period is well under way and with the Denial River crowded with Level Three accounting nonsense, all we need is some seed and the fertilizer they spew will feed the world for three decades to come. This means that the publicized reports by both the government and corporations are so politically motivated, so corrupted, that only those with a large amount of money or insider connections can get the true skinny as to find out what is next. But what if the news is so typical; the reporting so “Goldilocks”, that is causes the Fed to pause? That base just might as well have been covered also, and that’s why this writer is so concerned, that I felt motivated to pen this little ditty…..

Paint it Black

The Federal Reserve meets in two weeks and the deliberate destruction of the dollar must be insured so the markets do not crash, the monetary conversion process can continue unabated, and the banksters can continue to extract wealth from the middle and lower class via the inflation tax. So how does one induce the Federal Reserve to act without raising suspicion, bribery, or some other devious action? If there are no “black swans” migrating into the picture the solution is simple:

Paint a white swan, black.

The ability to manipulate your own accounting practices and principles allows anyone the flexibility to create a crisis at will. This is pure speculation on my part, but what if over the next seven to ten days a large investment bank was able to generate a temporary crisis by reporting numbers so bad, you know, by actually reporting the losses they incurred in the derivatives market, it caused a 5-12 percent stock market correction? Although you the reader might “gasp” at that concept keep in mind, the mysterious world of “mark to model” is still under wraps with the full blessings of the Fed and our government because no one wants to look behind the curtain in Oz. But if a disastrous loss could be reported that generates just enough market instability to force the Fed to act, then the profits realized by off shore hedge funds affiliated with the reporting company and overseas interests could well offset the immediate financial and political pain. In other words, instead of the “white swan” mundane Bubblevision “well we had a few write downs” nonsense reports we get on a daily basis, just before or after the markets open, someone drops a bombshell. Before you get all excited and say it is not possible, keep in mind these actors do not operate in the dark. If they expect or desire bad news, they simply dial 1-800-CAY-MANS and have their hedge funds borrow some Yen, load up on puts on their own company and others in their industry, and initiate the action to cash in. Add in a Fed rate cut and some currency plays and the “announced” losses could be offset with a boatload of cash in just a week, while also profiting from buying puts on their competitors who would share in the profits and inside information. This kind of synthetic crash also enables one bank to acquire another weaker sister that normally would not be allowed due to competitive restrictions under the guise of “depositor integrity” or some other such nonsense. While there is a lot of denial about this type of coordination, keep in mind that if it were not for these banksters and their pet hedgies in the islands, the U.S. government bond market probably would have crashed years ago. So to keep the illusion intact, everyone has been working together to keep this thing cobbled together.

There is no reason to doubt they are still working hand in hand, to keep it intact now, especially since Christmas and annual bonus time is right around the corner. For this personal investor, uh, that’s “me” the author, I’m loading up into safety. While a lot of people think safety means a Kevlar bullet proof vest, I’m making my vest out of silver and gold. With this upcoming potential manipulation, we could see a sharp correction in the precious metals as margin calls squeeze out some hedge funds and investors who have been raking in huge profits in the recent move. That being said a ten percent correction in gold and silver would be healthy and final. If the market crashes twelve percent in a week, look for the metals to do the same. Then the minute the Fed cuts rates, be it 25 or 50 basis points, watch out. The dollar crash will be resumed with a ferocity unseen in history as by Christmas we should approach the 72 level if there is one more cut for the holidays. This will trigger the last buying opportunity and final chance to profit in the precious metals before the hyperinflationary cycle engages in overdrive.

The Danger of Unintended Consequences

While this idea of painting the white swan black seems logical, controllable, and sane, there is a wild card. Should a major world geopolitical event trigger an actual “black swan” or random event simultaneously with the painted swan, then we could experience an actual equities and bond market crash that would be unrecoverable for over a decade. There is a lot of historical precedence to indicate that market manipulations can trigger or coincide with true, unexpected real world events outside of the puppet master’s control. No one anticipated Hitler’s rise to power starting in 1932, the start of World War One in 1914, nor the creation of a group of Islamic power centers in the 1970’s as a result of attempted market and economic system manipulations of those time periods. The blunders and gambles blew up in the face of the players and the refrain “we’ve learned our lesson” is always the same, no matter how bloody the results. Keep this in mind in the weeks to come.

10/4/07-Federal Reserve Meddling only $28 billion

Only $28 billion in open market operations today, interestingly only $640 million in MBS purchased. This could get interesting as next Friday approaches.

Source:

New York Fed Daily Market Operations

This Friday Night 10/5/07 on the Q-Files: The New World Currency

This Friday night I hope to introduce everyone to the new world currency plans and the realities we are facing. The best currency, still in my opinion is that of the precious metals at this point in time. Gold and Silver are true staples and even if you were able to hop a time machine back into the 1930’s US of A, 1922 Weimar Germany or ancient Rome, you would find that with gold and silver you could still make purchases. Enjoy the show and if you would like to email the show, contact me at johngaltfla@yahoo.com and we’ll discuss what is happening now and the devious plans the NWO has for our future.

To listen to the Q-Files you can do so as follows:
1. 7.465 Mhz from 7-8 pm (1900-2000) EDT

2. Streaming via www.wwcr.com (stream 1)

3. Streaming via www.stevequayle.com

The Fiction of Containment

by John Galt

October 3, 2007

With the news breaking tonight of Bear Stearns and Merrill firing folks left and right because of the ongoing mortgage fiasco, one has to ask, when does the market, the world and reality start to set in. The screams from our Minister of Information that “all is well” and “it’s contained” have become almost as comical as our old friend “Baghdad Bob’s” proclamations that the Americans were never even close to him as bullets whizzed by. There is a ton of fear in the markets and sadly, thousands of Americans who do not read, listen or pay attention to reality unless it involves a bimbo eruption by a hollyweird star, are allowing their financial managers to destroy their lives. The ARM resets are less than 30% complete yet the Bubblevisionistas proudly proclaim “it’s contained” and the “crisis is over” and beg you to buy their pump and dump stock selection.

Be scared, very scared.

There are a ton of reasons historically to be terrified of what we are witnessing. The implosion of the U.S. Dollar is the first and most alarming indicator. There has been a dead cat bounce the last few days, but everyone must keep in mind that the ChiComs are on vacation this week thus all the action is flowing through Hong Kong, not Shanghai. This also means that any surreptitious moves against our currency by the Chinese Communists now have the ring of “plausible deniability” as they quietly liquidate their flailing positions in U.S. investments. When all is said and done, I fear we will wake up one morning to a new kind of debacle, the worst kind, with the U.S. Dollar index crashing through 76 and the Dow rallying on the back of the Fed’s back door dealings.

This will not hold nor work for the long term.

The fallacy of dumping money into a black hole will eventually catch up to the Fed. They will continue to dump cash into the market in the prayer of keeping the dollar, the Dow and the dummies in DC afloat. All will fail. Until we see the capitulation move, any move upwards will only intensify the violence and depths of the coming crash. That is why I still think we could see Dow 15,000 but that will be a result of a more dramatic Fed intervention to fix the banking crisis or solvency crisis of the day.

The only logical reaction is to actually contain and control your losses by protecting your assets. Personally speaking, I’m loading up on silver, as much as I can afford, as fast as I can. It has a lot more leg room to accelerate to the highest returns and folks, I’m just warning you now, that with Cramer pumping gold tonight, start envisioning a return to the more traditional 20-1 plus ratio. The unemployment report on Friday will be a blatantly false number as the layoffs conducted by Wall Street, the mortgage markets and the construction industry will, as usual, be underestimated. I think that regardless of what the reports say, PIMCO has it spot on and the Fed will continue to cut interest rates. This triggers the flight out of U.S. Treasuries and the rally of the century in precious metals.

This could easily be the month where we see $800 gold and $20 silver. If not, it will happen by Christmas, so be patient, get your preps and beware of guys on the street corner screaming “Merry Christmas, IT’S CONTAINED”……

The Nightmare Month has Begun

(My apologies to all, but ComCast and my work have kept me offline pretty much the last 4 days. I’m back and will catch up to all the emails and news that I’ve missed-John)

October is historically a nightmare month and of course, to squeeze the shorts, the big boys rallied the Dow yesterday, because after all, that is the ECONOMY to most Americans. Unfortunately, the DGI’s are about to get a rude, rude awakening from the markets again. The credit crisis has been declared over by Bubblevision, just like they declared the subprime crisis, the housing crisis and the dollar crisis over in the last 60 days. They have to declare all of these problems as solved no later than October 15th, because they will finally have competition from Bubblevision Jr. which fires up that day and we have to have the Dow up to the mid 14,000’s so FBN will have nothing to talk about. This is a pathetic joke. A lot of ignorant investors who are going long this month are about to find out why history is important and why mutual funds are a waste of time and how Bubblevision will eventually get Ma and Pa Main Street into a government welfare program. The other shoe has not dropped and when it does, the floor will collapse with it.

Listening to the idiocy on the various business talk shows yesterday, it does not take a rocket scientist nor market technician to see what is setting up. Years which end in the number ‘7′ have a nasty tendency to correct and correct all markets hard. The cheering about the dollar being depreciated as it has will end soon because once the public figures out that the buying of our debt has pretty much stopped, the real inflationary spike will begin. Gold did not rally to over $750 on the futures because it’s a pretty metal. The dollar did not drop to historical lows because the U.S. has a strong economy. The future of our economy did not improve just because the “Financials” rallied yesterday to recover a small bit of their devastating losses over the summer. The sheeple just see Dow 14,000 and get giddy, then suckered. I wrote last month that we will probably see Dow 15,000 and it very well could occur this month. The cost will be our dollar as the 30 stocks which apparently control our economy will be manipulated to give everyone a feel good moment.

Right before it slams into the wall at 200 mph like an out of control race car. This nightmare has just begun. Stay tuned as in the days to come, I will have a lot more to say about what is happening and why it will not be as wonderful as the bubblevisionistas proclaim it to be. With a one day surge to a new record, the idiots are proclaiming proudly that “the worst is over” just to sucker more people back into the markets.

Don’t be a sucker. Read your history. Watch your six. This is just starting. And Friday’s manipulated unemployment data will be the first hint that it is worse than they want to publicize.