GOLD!

Yes it does, I'm confusing the terminology. Thanks for the correction :) You're helping me brush up on this material which I appreciate as I'm going for my MBA this fall. Thanks!

Post 41

Wednesday, May 17, 2006 - 9:45am

I find it especially useful to point out the negatives to poorer people and countries. This not only damages their basic argument, but also attacks something they all purport to care about as well, the poor and the thirld world. It shows that contrary to their posturing, which in rich countries allows them the option of being irrational, it is the poor who end up suffering for their ill-conceived beliefs.

Post 42

Wednesday, May 24, 2006 - 7:49pm

Well, the decline in the market in general and gold in particular has come to pass, with rewards for our decisiveness.

Bill, do you have any opinions on movements from here? I don't see any base for a sustainable rally in stocks but I'm not so sure about the price of gold as reflected in the chart for GLD. Memorial Day is coming up and sometimes there's a dramatic movement after these big holidays.

Sam

Post 43

Wednesday, May 24, 2006 - 9:36pm

Boy, Sam, we did right, didn't we! Got out when the getting was good! And just as we predicted, the downturn has eventuated, in spades! I went short on about two-thirds of my stocks on Friday, almost two weeks ago, and so far it's paid off. But the market sure has been topsy turvy these last few days. I think this slump is going to continue for awhile. It appears that whenever we see a bounce, people are using it as an occasion for selling and getting out. Also, the economic indicators haven't been great. Durable goods orders were down over 4%. I think there are just too many negatives right now to inspire much confidence.

- Bill

Post 44

Wednesday, May 24, 2006 - 11:06pm

Whatever happens, the future will be interesting.

Post 45

Thursday, May 25, 2006 - 1:24am

I'd like to point out that the Dow is up around 10% since last year. It's also up, a bit, over the last 3 months. Invest for the long term, not short term variations. I believe that the market will increase in value over the next 10-20 years.

Post 46

Thursday, May 25, 2006 - 7:08am

Jordan:

I believe that the market will increase in value over the next 10-20 years.

As do I, that's why my grand daughter's trust is designated to be invested in Spiders. If I were to pop off tomorrow it would be invested for 22 years before she has full access to it.

For myself, I think it's imprudent to not take advantage of a clear, shorter term trend when the signs are there for all to see. Since May 2002 I've outperformed the Dow by 10.3%, the SP500 by 7.3% and the DAQ by 8.7% (divide by 4 for yearly figures) not including dividends.

Sam

Post 47

Thursday, May 25, 2006 - 6:31pm

And since March 12, 2003, I've outperformed the Dow by 33.5% and S&P by 26.5%, also not including dividends. The Dow is really a mediocre index; the S&P is better, of course, but in a recovery like this, small caps, like the Russell 2000 are even better. I gained about 90% on the I-shares, the 2000 ETF, and about 60% on my tech stocks during this period, but their performance has been lagging the past couple of years. Wish I had invested in energy stocks back then; I would have done a lot better. The only problem is their volatility. What do you think of energy as an investment right now, Sam?

- Bill

Post 48

Thursday, May 25, 2006 - 9:35pm

Bill:

Those returns are stupendous. I actually lost money during that same period.

Wrt my opinion on energy stocks ... the XLE doesn't look appealing to me. There's a double top and a bit of a rally approaching the 50 day exponential moving average which is typical of the weakness in virtually all the indices. If I had to choose a scenario it would be a rally up to the 50 day ema in the major indices and then it would be time to short everything in sight, or invest in counter movement stocks like utilities, SHY or LQD.

I'm sitting on a pile of cash waiting for that to happen.

Just my opinion and I may be wrong ... and I might change my mind. I'm leery of Memorial Day.

Sam

Post 49

Friday, May 26, 2006 - 6:06am

Bill Dwyer,

Just curious. March 2003 was approximately the start of the current (maybe recently ended) bull market. How did you do in the 12-month (or 24- or 30-month) period prior to March 2003, bad epochs for all the stock indices?

I invested a sizable chunk in two mutual funds in 2003 that have outperformed even the Russell 2000, and a couple of others that performed close to the Russell 2000. I suffered during the bad epoch but not near as much as some because I shunned the Nasdeq tech stocks. However, I don't have overall numbers like you and Sam.

Post 50

Thursday, June 1, 2006 - 7:27am

China Should Buy Gold, Central Bank Adviser Says

June 1 (Bloomberg) -- China should use its foreign-currency reserves, the world's largest, to buy gold and oil as a hedge to guard against the risk of a sudden drop in the U.S. dollar, said an adviser on the central bank's 13-member policy board.

`Fourth Currency'
The country's foreign-exchange holdings as of March 31 surged to $875.1 billion, up more than $50 billion from end-2005 and overtaking those of Japan as the world's biggest.
``Central banks will use gold as a fourth currency instead of the dollar, euro and yen'' to hedge exchange-rate risk, said George Kapasakis, a senior foreign-exchange trader at Mizuho Corporate Bank in Sydney. ``Gold will be underpinned.''

``China needs to establish a separate body to oversee and invest the reserves to seek higher returns and to avoid losses in case of a big depreciation in the U.S. dollar,'' Yu said. ``We need to use some of the reserves to buy other assets such as gold and strategic resources such as oil.''

http://www.bloomberg.com/apps/news?pid=10000080&sid=aV75beK4jSeQ&refer=asia

Slowly, slowly the world seems to be recognizing the unique role of gold in economic affairs.

Sam

Post 51

Thursday, June 1, 2006 - 8:02pm

Merlin, I was out of the market during that period. I became fully invested March 12, 2003, and have remained so almost entirely since then. But I sold all my stocks a couple of weeks ago and went short. Yesterday, I repurchased the shares, and took a long position. Here's hoping the market continues to recover! :)

Sam, where are you now? Did you sell, and if so, did you buy back?

- Bill

Post 52

Friday, June 2, 2006 - 5:54am

Bill:

I'm mostly in cash now. I sold all my gold stocks and index tracking stocks May 15, subsequently bought INTC which I quickly sold after 4 days for a very small loss and purchased the utilities Spyder, XLU, which I still have. I went short DIA on the 26th at 112.40 and am still short. This may turn into a loss as the market seems to be very strong this morning. I'm not convinced that we've seen the lows, though. I'll wait and see before covering my DIA.

Good luck t' ya.

Sam

Edited: Half an hour into the session today that strength vanished.

(Edited by Sam Erica on 6/02, 6:58am)

Post 53

Friday, June 2, 2006 - 3:43pm

You guys sound more active than tech stock daytraders I knew in the late 90s - and much more broad industry and stategy. I've never known anyone before willing to change an entire portfolio long/short and back! How much time do you dedicate to trading and the requisite company/industry/market research?

Post 54

Friday, June 2, 2006 - 7:44pm

Aaron, I don't spend a lot of time at it. I follow certain professional market timers, who have a proven track record, like Bob Brinker. So far, it's worked well for me.

- Bill

Post 55

Friday, June 2, 2006 - 9:10pm

Also, I'm not as active a trader as it appears from my recent posts. These last few weeks were an exception. I might make no more than a few trades a year, depending on market trends. I don't track individual stocks; only ETF indexes that represent the broad market. To trade individual stocks, you have to spend a lot more time researching them, and even then it's risky. Enron is good example. Right now, I have only two ETF's - the I-shares for the Russell 2000 and the QQQQ's (whose performance this past year has been uninspiring, to say the least). But there's enough diversification there to suit me, plus I can trade them easily (getting in and out) without a lot of hassle.

- Bill

Post 56

Friday, June 2, 2006 - 9:50pm

Aaron: In the first half of this year I traded only about two stocks but in former years I would make perhaps 200 trades. I'm strictly a technical trader and I happened to look at the charts on the weekend of May 14 and when I saw what was developing I knew I had to dump my stocks. I didn't go 180 degrees, as Bill did, and as I sometimes have done in the past ... just took a defensive position. I've never regretted any 180 degrees shift I've made yet.

I developed some health problems last year and didn't want to add to the stress but I'm retired and can devote more time to the action. My favorite site is Clearstation

http://clearstation.etrade.com/

It's free and you can set up numerous portfolios and scan literally 1000 or more charts in less than an hour. Before discount brokers came on the scene the commissions used to kill me but with $5 trades you can forget that aspect.

The most profitable trades I used to make were short sales of individual stocks (as markets decline much faster than they rise) but I have become more conservative and when I short I usually do it with index tracking stocks, as Bill also prefers ... although it's tempting when I see BA and CAT as vulnerable as they are right now.

I had a problem with my internet provider at noon on Friday May 26 and was out until the 31st so I was unable to gauge the market. If had access I would have undoubtedly shorted more on Tuesday ... but that opportunity passed.

It's interesting that Bill and I independently came to the same conclusion on the weekend of May 14 (although I think he dumped his stocks on the Friday). We've never discussed stocks before and use entirely different methods.

Sam

Post 57

Saturday, June 3, 2006 - 1:42am

It's interesting that Bill and I independently came to the same conclusion on the weekend of May 14 (although I think he dumped his stocks on the Friday). We've never discussed stocks before and use entirely different methods.

Yes, I liquidated my long position on Friday, the 12th, and went short on Monday, the 15th. One of the market timers I use recommended going short on Friday, which would have been even better, but I still did quite well for the two weeks that I was short. I'm not as technically sophisticated as Sam, so I prefer to take the advice of experts, which, as I say, has been pretty reliable.

- Bill

Post 58

Thursday, December 28, 2006 - 6:34am

Remembering President Gerald R. Ford

Executive Order 11825 - Revocation of Executive Orders Pertaining to the Regulation of the Acquisition of, Holding of, or Other Transactions in Gold
December 31st, 1974

By virtue of the authority vested in me by section 1 of the Act of August 8, 1950, 64 Stat. 419, and section 5 (b) of the Act of October 6, 1917, as amended (12 U.S.C. 95a), and as President of the United States, and in view of the provisions of section 3 of Public Law 93-110, 87 Stat. 352, as amended by section 2 of Public Law 93-373, 88 Stat. 445, it is ordered as follows:
SECTION 1. Executive Order No. 6260 of August 28, 1933, as amended by Executive Order No. 6359 of October 25, 1933, Executive Order No. 6556 of January 12, 1934, Executive Order No. 6560 of January 15, 1934, Executive Order No. 10896 of November 29, 1960, Executive Order No. 10905 of January 14, 1961, and Executive Order No. 11037 of July 20, 1962; the fifth and sixth paragraphs of Executive Order No. 6073, March 10, 1933; sections 3 and 4 of Executive Order No. 6359 of October 25, 1933; and paragraph 2(d) of Executive Order No. 10289 of September 17, 1951, are hereby revoked.
SECTION 2. The revocation, in whole or in part, of such prior Executive orders relating to regulation on the acquisition of, holding of, or other transactions in gold shall not affect any act completed, or any right accruing or accrued, or any suit or proceeding finished or started in any civil or criminal cause prior to the revocation, but all such liabilities, penalties, and forfeitures under the Executive orders shall continue and may be enforced in the same manner as if the revocation had not been made.
This order shall become effective on December 31, 1974.
GERALD R. FORD
The White House,
December 31, 1974.
Note: The text of the Executive order was released at Vail, Colo.
http://www.presidency.ucsb.edu/ws/index.php?pid=59185

Post 59

Tuesday, January 2, 2007 - 6:50am