28
Feb 11

February Market Summary

Despite volatility in the face of unrest in the Middle East, stocks showed notable gains for February.  The Dow Jones saw a 2.8% gain holding above 12,000 for most of the month.   The S&P 500 showed a gain of 3.2% and only dipped below the key level of 1,300 twice.   The NASDAQ Composite ended the month 3% higher.  According to the Wall Street Journal, this is the best February for the indexes since 1998.  It is also the the third month in row that gains were posted.  In my view this is a continuing correction in a long term bear market.  I don’t suspect it will last much longer before equity prices resume their broader decline.  Continue reading →


28
Feb 11

Ron Paul wins another Straw Poll

The Texas Republican and libertarian favorite, Ron Paul, has won another straw poll.  This time it was at the Tea Party Patriots American Policy Summit held in Phoenix this weekend.  Continue reading →


28
Feb 11

Derivatives Gone Wild

Credit Default Swaps (CDS), the financial instruments that were at the root of AIG’s failure during the financial crisis, and a key component to the meltdown, are in the news this morning.

For the uninitiated, Credit Default Swaps are much like insurance, except, rather than covering events like flood or fire, they cover the default of a debt.  For example, if you hold a corporate bond and you are not sure that the company behind the debt will be able to make good, you can buy a CDS to protect your investment.  If the company does default, the issuer or writer of the CDS is required to pay you money.  Again, this is similar to insurance.  If you buy house, but are concerned about the potential for loss you might take if it burns down, you buy hazard insurance. Continue reading →


28
Feb 11

General Obeservations – Feb 28, 2011

According to an article in National Geographic, a small nuclear war could be the solution to global warming:

Even a regional nuclear war could spark “unprecedented” global cooling and reduce rainfall for years, according to U.S. government computer models.

Essentially, NASA climate models suggest that such an event would create high altitude carbon clouds where they would block out the sunlight and cool the planet – like a small nuclear winter.  Hey, wait a minute, I thought carbon caused global warming?!?  For years we’ve been hearing, “Carbon is bad mm K?”  Now we have government research dollars being spent to come up with ideas like this one.  I guess it won’t be long now before Al Gore and his gang of neo-liberal wack jobs are proposing that we blow ourselves up to save the planet.   As I suspected, the global warming fear mongers are far more dangerous to us than some extra carbon in the atmosphere. Continue reading →


26
Feb 11

Stacking Nickels

Jefferson Nickel

The everyday common nickel we toss around with the rest of our loose change is perhaps the only real money we use in America.

According to coinflation.com, the 1946 to present Jefferson Nickel has a melt value of over 7 cents.  Of course, our government overlords have deemed it a crime to actually melt the coins.  No matter, the fact that they have real base metal value makes them “sound money”. Continue reading →


25
Feb 11

General Observations – Feb 25, 2011

The Federal Reserve Balance Sheet reached $2.5 trillion this week.  The increase came primarily from an increase in Treasury holdings (can you say debt monetization?).  The Fed now holds more Treasury debt than China.  Read more at Zero Hedge. Continue reading →


24
Feb 11

Hello world!

The G Report starts flowing soon ……..