Archive for October, 2013

Dr. Steve Sjuggerud: Exactly where we are in the "great bull market" now

From Steve Sjuggerud, editor, True Wealth:
 
"Steve, what are you thinking these days? What's going on out there?"
 
A friend asked me that at a charity fundraiser this week. He was hosting the fundraiser at his large, beautiful home here in Florida.
 
My friend wasn't asking these questions just to make conversation… He was asking because his career depends on it…
 
You see, this friend is in real estate. He made real money in the real estate boom as a real estate developer and the co-founder of a bank. But he was, of course, hit hard in the real estate bust. Unlike many, he survived. And he's been buying property lately.
 
"Look, the interest rate on my home mortgage reset at just two-and-change this week," I told him. "How can you NOT make money in this environment? Anyone with an entrepreneurial bone in their body should be able to make money in this environment."
 
He breathed a sigh of relief. He said he thought things were getting better now. He told me, "For the first time in years, I have a bidding war – multiple homebuilders – bidding on my properties."
 
I think he doesn't have that much to worry about. He needs to stop watching the news…
 
In our Internet age, there's plenty of information out there. The hard part is knowing what information to hang your hat on.
 
To me, the most important information these days is not about the government shutdown, the debt ceiling, or any of that stuff. The most important piece of information is that Janet Yellen is the newly appointed chairman of the U.S. Federal Reserve.
 
This means we will have many more years of very low interest rates. And this situation will drive asset prices – like stocks and real estate – much higher than anyone can imagine.
 
This has been our thesis for years – what I've been calling the "Bernanke Asset Bubble." And it appears it will remain in place for a couple more years. That's what I'm hanging my hat on.
 
Hopefully you've followed my advice… and you've made truckloads of money in this great bull market.
 
For years now, I've done my best to get you to buy stocks and to buy real estate. It was the right advice… Both stocks and real estate have absolutely soared.
 
The good news is, you haven't missed it yet…
 
We are now in about the sixth inning of this great bull market in stocks. (Real estate is still in the earlier innings.) But as I will explain, I'm confident the biggest profits will happen in the final innings.
 
With Yellen as the head of the Federal Reserve, I believe we have much bigger gains to come. I believe the big profits will come sooner as well, as investors come to fully realize what I've been saying.
 
So instead of selling stocks or real estate today because they've gone up so much, you need to do the opposite… You need to buy more.
 
You see, the Federal Reserve – under Yellen – is going to keep interest rates low for longer than you can possibly imagine.
 
Even Bond King Bill Gross said that long-term interest rates should stay "abnormally low" – close to 1% – for a very long time… possibly out to 2035. It's not as crazy as you might think…
 
Are you prepared for 1% interest rates for a very long time?
 
If your retirement plan is to sit and wait and hope to earn higher interest someday, then you have no plan. That day might not come for you.
 
What can you do?
 
In the coming years, as the realization of low rates sets in, I'm confident that more and more money will flow into stocks and into housing.
 
I expect "bubbles" will return in the stock market and in the housing market… as people realize they NEED to do SOMETHING with their money.
 
If your retirement portfolio can't handle the possibility of low interest rates for a long time, you need to make some changes now… before it's too late…
 
I estimate we're in the sixth inning of this ballgame. There's plenty of fun still ahead, but we're finally past the halfway point. Stocks are not as cheap as they were. And they're not as hated as they were.
 
However, the game is not over yet. Here are a couple things we can look forward to:
 
Mom and Pop America have not joined in the fun yet. Nobody is talking stocks at cocktail parties. But we are seeing the first signs that they're dipping their toes in. The bull market won't end until they're over-invested in stocks. We're a long way from that.
 
The highly speculative sectors in the market haven't completely soared yet. But that is just starting.
 
And foreign markets have lagged the U.S. stock market so far. But that is changing.
 
Crux note: Steve Sjuggerud predicted this "great bull market" years ago. He's been exactly right… and his True Wealth subscribers have made incredible gains because of it.
 
Now, Steve says he knows exactly how it will end… and how the next market crash will begin. Click here to see for yourself.
 
More from Steve Sjuggerud:
 

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Obamacare FRAUD: Beware of these five common scams

From Newsmax:
 
The glitches that have hobbled the rollout of the Obamacare Affordable Healthcare Exchanges and the news that thousands will be dropped from their health plans — despite assurances that wouldn't happen — aren't the only problems facing consumers. Security experts are warning that Obamacare has also opened the flood gates for scam artists.
 
Numerous reports across the country have cited fraudsters hawking bogus non-existent "Obamacare cards," masquerading as government employees offering assistance, and creating phony websites that look like the official HealthCare.gov site consumers can use to sign up for insurance plans through the new marketplaces.
 
"Confusion about what exactly the Affordable Care Act means for consumers and businesses is what con artists prey upon," said Karen Nalven, president of the Better Business Bureau serving West Florida.
 
"Scammers' favorite tools are…
 
 
More on fraud:
 
 
 

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Doc Eifrig: Treating high cholesterol could have an unexpected and terrible side effect

From Dr. David Eifrig, editor, Retirement Millionaire:
 
Fighting cholesterol is costing people their eyesight…
 
New research confirms that statins – the most commonly prescribed drugs for lowering cholesterol – increase your risk of cataracts. Millions of people in the U.S. currently use statins like Lipitor. But studies continue to show statins are dangerous.
 
A new study from the University of Texas Southwestern Medical Center and the Dallas VA Medical Center found people using statins have a 27% greater risk of developing cataracts. The longer you use statins, the more likely you are to develop cataracts.
 
This isn't the first time we've learned of this risk… A 2012 study from Canada's University of Waterloo found statins increase the risk of developing cataracts 50%. People with type-2 diabetes have an even greater risk. Yet, doctors practically demand their diabetic patients take the drug.
 
The government is catching on to the danger. Just last year, the Food and Drug Administration (FDA) added a warning label saying statins may raise blood-sugar levels (increasing your risk of diabetes) and cause memory loss.
 
If your doctor says you have high cholesterol, try to lower it naturally before resorting to statins. Wine, white onions, and blueberries all lower cholesterol. Exercising – and losing weight if you're overweight – also helps. Above all, make sure you avoid the "white killers" – like sugar, white bread, and white rice.
 
The cholesterol model has been broken for decades. The connection with heart disease and cholesterol is modest at best. And yet, Big Pharma's marketing efforts have convinced most doctors that statins are the best drug for curing nearly everything.
 
Crux note: Doc Eifrig is a trusted source of common sense, science-backed health advice… but he's also an expert at finding unconventional yet easy-to-understand income opportunities.
 
Recently, he discovered a fun new way to make extra money for your retirement. It has absolutely nothing to do with stocks, bonds, options, or any other traditional investment… yet it can allow almost anyone to earn an extra $350 to $1000 each week. Click here for all the details.
 
More from Doc Eifrig:
 
 
 

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Top resource firm Sprott: Don’t make this BIG gold and silver stock mistake

From Sprott Global Resource Investments:
 
Precious metals miners are the most volatile stocks on earth. They're so volatile that investors often forget that underneath those whipsawing stock prices lie real businesses.
 
But even many of those who consider themselves old pros in natural-resource investing tend to get one thing wrong. Eric Angeli, an investment executive with Sprott Global Resources and protégé of legendary resource broker Rick Rule, explains how not to fall into the "top-down" trap…
If the past two years have taught us anything, it's that trying to predict short-term moves in the gold price can be a road to ruin.
 
Parsing the umpteen countervailing forces that combine to set the price of gold is tough. And it's even tougher when you consider that oftentimes, market-moving news, such as a central bank trade, isn't reported until after the fact.
In my years spent evaluating natural resource companies as a broker and analyst, I've found that there are two ways to successfully invest in precious metals equities. Doing it right can bolster the strength of your portfolio, not to mention your own confidence in your holdings.
Method #1…
 
 
More on precious metals stocks:
 
 
 

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Today’s entertainment: Six "ridiculous" science myths you learned in kindergarten

From Cracked.com:
 
Right around the time we learn to start questioning the ways of this wonderful world around us, our parents start packing us onto school buses every morning, because who the hell has time for all those obnoxious questions?
 
Let the professionals address the budding curiosity of our children; we've got America's Next Top Model to watch. Teachers are better equipped to deal with those questions anyway, right? Right!
Mostly. Teachers are people, too, and people have this nasty tendency to occasionally lob whatever untruth comes flying at them right back at somebody else like a game of B.S. ping pong. For example…
#6. The Coriolis Effect Controls the Direction in Which Toilet Water Drains…
 
 
More entertainment:
 
 
 

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"539%": Outrageous post shows how high health insurance premiums could soar under Obamacare

From Natural News:
 
It is crucial for the White House that the Healthcare.gov website continue to fail, because once the site actually starts functioning, Americans are going to be hit with such devastating rate shock that the Obama administration may never recover.
 
Obamacare is named the "Affordable Care Act," after all, and the President promised the rates would be "as low as a phone bill." But I just received a confirmed letter from a friend in Texas showing a 539% rate increase on an existing policy that's been in good standing for years.
 
As the letter reveals (see below), the cost for this couple's policy under Humana is increasing from $212.10 per month to $1,356.60 per month. This is for a couple in good health whose combined income is less than $70K — a middle-class family, in other words.
 
That's a 539% rate increase!
 
$1,356.60 per month is not "affordable" health care. It's monopolistic price gouging mandated by the Obama administration and enforced essentially at gunpoint. This isn't health care; it's highway robbery…
 
 
More on Obamacare:
 
 
 

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EXCLUSIVE: This is where the next oil "juggernaut" could be found, Part 7

From Matt Badiali, editor, S&A Resource Report:
 
The man in the passenger seat lifted up the black and white checked scarf beside his leg. Under it was an AK-47 with a folding stock. The driver had an identical one. That's when I knew this wasn't going to be a typical trip out to look at rocks.
 
Taking a couple hours' drive up into the mountains north of Erbil is quite an experience. It apparently requires a two-car convoy with two drivers and two armed guards. We passed several checkpoints, one of which had an armored personnel carrier with what looked like anti-aircraft guns on the roof… and there was a gunner behind them.
 
This was the one part of my trip to Erbil that was non-negotiable for me. I needed to see the rocks. I wanted to look at how the drilling rigs were set up and hopefully see an oil seep.
 
As I found out… it's not that easy.
 
We headed out of the city around 2 pm, after my morning meetings. It was a pleasant drive… as long as guns and armed guards don't make you nervous. The roads were fantastic. The asphalt was wide and smooth. The only hiccups were the occasional checkpoint, sheep crossings, and once, a solitary cow gazing placidly from the center of the road.
 
Our two Toyota land cruisers climbed over a low ridge and down into a long valley. The desert here is dotted with small trees and flocks of sheep. We could have been on the Colorado/Utah border. Rock layers in the mountains looked like oversized piles of books that slid over onto their sides.
 
Like the city, the valley to the north was a hotbed of construction. Houses and compounds were going up all over. There was a larger construction project as well off in the distance… possibly a new highway or pipeline.
 
Finally, we began to climb up a steep mountainside on the far side of the valley. The views were spectacular. But it was the cliff side I wanted to see. The rocks were exactly as advertised… a classically folded sequence of marine rocks. Textbook oil fields were exposed on the surface.
 
We stopped at the top of the mountain to take pictures, but I quickly ducked out to go look at the thick limestone exposed in the road cut.
 
The group eventually got tired of watching me climb around (even after I found them a fossil…). So we piled into the trucks and headed back toward the hotel.
 
On the ride down the mountain, a flock of sheep stopped us. The shepherd couldn't have been much older than my daughter Kate, who is eight. He yelled a word that I didn't know. Then he made drinking motions with his hands. I fumbled around my seat and found an extra bottle of water. I held it up and waved him over. His face lit up when he took it from me. He gave me a huge smile, put his hand on his heart and gave me a slight bow… then ran off to follow his flock up the hill.
 
P.S. The picture today is the view from the top of the ridge looking back towards Erbil to the southwest.
 
Click here to read Part 1.
Click here to read Part 2.
Click here to read Part 3.
Click here to read Part 4.
Click here to read Part 5.
Click here to read Part 6.
 
More on the energy sector:
 
Natural gas BOOM update: When Rolls-Royce gets involved, you know it's big
 
NO. 1: China just passed the U.S. in another important energy category
 
The next big revolution in the energy markets could have nothing to do with oil and gas

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U.S. Treasury alert: Interest rates could be headed higher immediately

From Jeff Clark in Growth Stock Wire:
 
The bond market rally has reached its target.
 
Eight weeks ago, interest rates on the 10-year Treasury note popped to 3% – the highest rate in two years. At the time, we argued that even though interest rates were likely headed higher over the long term, the short-term move was a case of "too much too soon."
 
We suggested rates were due to pull back a bit and bonds were poised for a short-term rally. We were looking for the 10-year rate to drop down to around 2.5%.
 
It hit that target last week.
 
Take a look at this chart of the 10-year Treasury yield…
 
 
More on interest rates:
 
 
 

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The 30-second takeaway from today’s "market-moving" Federal Reserve announcement

From Bloomberg:
 
The Federal Reserve decided to press on with $85 billion in monthly bond purchases, saying it needs to see more evidence that the economy will continue to improve.

"The recovery in the housing sector slowed somewhat in recent months," the Federal Open Market Committee (FDTR) said today at the end of a two-day meeting in Washington. "Fiscal policy is restraining economic growth."

Ben S. Bernanke is pushing unprecedented accommodation into the final months of his Fed chairmanship as he seeks to shield the four-year economic expansion from the impact of this month's partial U.S. government shutdown. The 16-day closing resulted in the furloughs of as many as 800,000 federal workers and delayed release of data the Fed says it needs to evaluate the economy.

"Taking into account the extent of federal fiscal retrenchment over the past year, the committee sees the improvement in economic activity and labor market conditions since it began its asset purchase program as consistent with growing underlying strength in the broader economy," the committee said. The Fed repeated that it will "await more evidence that progress will be sustained before adjusting the pace of its purchases."

The Standard & Poor's 500 Index fell 0.5 percent to 1,763.50 at 3:28 p.m. in New York as some investors were disappointed the Fed did not provide stronger signals of prolonged stimulus. The yield on the 10-year Treasury climbed to 2.52 percent.

Options Open

"If you were looking for dovish signals, you didn't get it," said Michael Gapen, a senior U.S. economist at Barclays Plc in New York and former member of the Fed board's Division of Monetary Affairs. "They're keeping all of their options open."

The Fed's purchases will remain divided between $40 billion a month of mortgage bonds and $45 billion in Treasury securities.

"Wait-and-see seems to be the prescription for the day," said Scott Anderson, chief economist at Bank of the West in San Francisco. "They're on hold given that the data haven't moved in their direction," said Anderson, who predicts the Fed won't make its first cut to bond buying until March.

The central bank left unchanged its statement that it will probably hold its target interest rate near zero "at least as long as" unemployment exceeds 6.5 percent, so long as the outlook for inflation is no higher than 2.5 percent.

The Fed repeated that inflation "has been running below the committee's longer-run objective but longer term inflation expectations have remained stable."

Fuel Charges

Price gains have lagged below the committee's 2 percent long-run target. The cost of living rose as projected in September as fuel charges climbed, capping the smallest year-to-year gain in five months.

The consumer price index increased 0.2 percent after rising 0.1 percent the prior month, a Labor Department report showed today. The Fed's preferred gauge of inflation, the personal consumption expenditures index, rose 1.2 percent in August and hasn't breached 2 percent since March 2012.

The Fed removed a sentence from its previous statement in September that had said tighter financial conditions could slow the improvement in the economy.

Borrowing costs have declined in recent weeks. The yield on the 10-year Treasury (USGG10YR) note fell to 2.49 percent late yesterday from as high as 3.01 percent on Sept. 5. The average 30-year mortgage rate fell to 4.13 percent last week from as high as 4.58 percent in August.

Inflation Expectations

Kansas City Fed President Esther George dissented for the seventh meeting in a row, citing the risk the Fed's stimulus could create financial imbalances and cause long-term inflation expectations to rise.

Economists forecast no change to the Fed's bond buying today. The FOMC won't reduce the pace of purchases until its March 18-19 meeting, according to the median estimate of an Oct. 17-18 Bloomberg News survey.

President Barack Obama has nominated Vice Chairman Janet Yellen to succeed Bernanke, whose term expires on Jan. 31. If confirmed by the U.S. Senate, Yellen would take on the challenge of dialing down so-called quantitative easing and withdrawing stimulus while maintaining growth.

Central bankers are waiting to see how the economy weathered the budget impasse and debt-limit debate earlier this month. The shutdown reduced growth by 0.3 percentage point this quarter, according to the median estimate in an Oct. 17-18 Bloomberg survey, as businesses from Capitol Hill eateries to Florida Everglades charter boats lost customers while workers were furloughed and national parks were closed.

Before Shutdown

Some data measuring the strength of the economy in the months before the shutdown still hasn't been released, and delays to other reports may distort the figures, according to economists. A report on economic growth in the third quarter, originally scheduled for release today, was postponed until Nov. 7.

"The quality of the data may be suspect because of disruption to the normal survey routines," said Dana Saporta, a director of U.S. economics research at Credit Suisse Group AG in New York.

"When we look back on this quarter in the future, we might not see much evidence of the government shutdown in the aggregate data," she said. "But we don't know that, and it will be several weeks before we can analyze the impact of the shutdown and debt-ceiling debate."

Some private reports and delayed government indicators for September showed the economy was having trouble accelerating prior to the shutdown.

Home Sales

Employers in the U.S. added 148,000 jobs last month, down from 193,000 in August. Factory output rose less than forecast, and existing-home sales fell for the first time in three months as rising prices and mortgage rates damped demand.

At the same time, American consumers kept spending on most types of goods last month, a Commerce Department report showed yesterday. Sales at retailers excluding auto dealers rose 0.4 percent after a 0.1 percent increase the prior month.

The government shutdown took a toll on consumer and business confidence in October, recent reports suggest. The Bloomberg Consumer Comfort (COMFCOMF) Index sank to the lowest level in eight months in the week ended Oct. 20.

Fewer Workers

Companies this month added fewer workers than projected, a private report based on payrolls showed today. The 130,000 increase was the smallest in six months and followed a revised 145,000 gain in September that was weaker than initially estimated, according to the ADP Research Institute in Roseland, New Jersey.

The monthly figures are the first to show how employment fared during the government suspension. Limited employment and wage gains, along with the prospect of another fiscal battle early next year, raise the risk of restrained retail sales during the holidays.

Still, gains in stock prices and home values are shoring up household balance sheets. Equities have rallied, pushing the S&P 500 Index (SPX) to records, on rising corporate profits and expectations that the Fed will maintain stimulus.

General Electric Co. is among companies beating analyst estimates. GE, the conglomerate that is the world's largest maker of jet engines and diesel locomotives, said Oct. 18 that profit margins on its industrial businesses grew 1.2 percentage points as orders climbed in China, sub-Saharan Africa and Russia.
Industrial Strength

"Our third-quarter results were very strong in an improving global business environment," Chief Executive Officer Jeffrey Immelt said in a statement. "Our industrial strength was broad-based."

The Fed unexpectedly refrained from tapering at its meeting last month, seeking more evidence the economy is strengthening. Economists surveyed by Bloomberg before the gathering predicted the Fed would begin reducing the pace of purchases.

The September decision was characterized as a "close call" by Fed Governors Jerome Powell and Jeremy Stein.

"There are some question marks about growth in the U.S. economy," said Nathan Sheets, the global head of international economics at Citigroup Inc. in New York and a former top economist at the Fed board. "The Fed is inclined to watch and wait until they're comfortable that we've seen a meaningful rebound."

To contact the reporters on this story: Joshua Zumbrun in Washington at jzumbrun@bloomberg.net; Jeff Kearns in Washington at jkearns3@bloomberg.net.

To contact the editor responsible for this story: Chris Wellisz at cwellisz@bloomberg.net.

 
More on the Fed:
 
Frightening analysis shows the Federal Reserve is guaranteed to destroy the U.S. dollar
 
"Dr. Doom" Marc Faber: Federal Reserve money-printing will SOAR into the TRILLIONS
 
Stunning chart suggests the Federal Reserve could continue "QE" longer than almost anyone imagines

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How My Gold Standard Thinking Has Changed The Last Two Years – Forbes


Live Trading News
How My Gold Standard Thinking Has Changed The Last Two Years
Forbes
What this means is: the currency manager (which could be a central bank, or could be a different organization working in a “free banking” or “parallel currency” framework), would exchange only gold bullion and base money (banknotes and bank reserves).
What the Elephant Trying to Get into the Pool Said About GoldJutia Group
Why I Remain Bullish on GoldTrefis
Gold Traders Bullish a Third Week on US StalemateBloomberg

all 12 news articles »

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