as of this writing, S&P future is frozen due to downside limit. Looks like the credit crunch has been spreading to Asia, (most notably Korea and Japan -- off to 10 year and 5 year low) and possibly other South America countries beside Argentina could be in danger too. unfortunately, there is a good chance the next shoes to drop is the world currency. bluntly speaking, even the cash we are holding on could be worthless pretty soon. Dont forget the market has not priced in the upcoming stagflation and hyper-inflationary period.
Therefore, this is the good time to snap up some physical gold and silver to hedge against further meltdown. at the end of the day, you have something leftover instead of nothing.
At this point, you may throw out those technical support points for all market because we cannot prevent irrational folks doing panic selling at this moment. DO IT SOON. before it's too late.
This is not a financial tsunami. this is black hole where something must give to calm this crisis.
GOOD luck!!
Friday, October 24, 2008
Wednesday, October 8, 2008
BLACK HOLE 2009
BLACK HOLE 2009
Ladies and Gentlemen: when you get a chance, time to prepare for black hole 2009. No doubt, the recent financial crisis in Europe will continue and possibly will bring more fear to Asia soon and worse around the world. There are three things that people should be aware that mainstream media hasn’t fully covered thoroughly the truth out there.
First, the credit default swaps (CDS) in the banking system will be a bottomless hole that the governments and world banks cannot cover up and settle the outstanding derivative contracts. Based on the source from Bloomberg and Fortune magazine, there is $62 trillion dollars of CDS sitting in the system. Subprime MBS is NOT the cause of the current crisis. It was a tip of the iceberg. Who is going to pay/trade for CDS No body knows. Maybe, looking at Henry Paulson expression last week., he said it all. They must act now to buy more time!!
Second, the interbank rate (loan rate between institutions and banks lending to each other) has been UP UP UP for 1 month, 2 month, 3 month term-loan. NO significant adjustment occurs that we are out of the panic and danger area. The rate is telling us the banks DO NOT trust each other. Why bother lending to someone who might be in trouble later on?? Another important impact, small and medium businesses would be suffering from lack of liquidity to pay off payables and salaries. Just imagine taking out high rate credit line to pay off normal expenses. The owners would take major hit on this. Workers might not get their pay-check in the near future.
Third, misery index (unemployment and inflation) has been rising. Latest US employment report shows a 9 consecutive monthly job decline. Although the rate was unchanged, the government has been trying to paint a solid picture. The trend has been the same in Europe. Asian would not be alone. Japan is near recession and the exports sectors South East Asian countries would feel the pain eventually when US and Europe confirmed their economic recession. On the inflation front, the food and energy price have been stabilized but no adjustment due ot lack of demand. Therefore, normal citizens are continuing to pay high prices while the economic outlook is negative and workers might lose their jobs if new round of laid off occurs.
At this point, I don’t know what will happen, how will happen and when will happen. All I know for sure is that the banking system has been reverted back to 1907. YES. You read it correctly 1907. The turning point was when AIG needs 85 billions USDs temporarily loan from US Federal Reserve, the banking and insurance industries are virtually INSOLVENT with the exception of a few players such as Goldman Sachs, JP Morgan, Citibank, Warren Buffett standing w/ government backing and supports. If you look at a bigger picture, some Central Banks around the world holding US notes and dollars are taking major hits in their portfolio. The $770 billion law only allow more time for politicians and bankers to buy more time to do MORE coverup.
So, time to start use ATMs and get some cash. Collect silver and gold coins to protect your assets. Good luck!!
Ladies and Gentlemen: when you get a chance, time to prepare for black hole 2009. No doubt, the recent financial crisis in Europe will continue and possibly will bring more fear to Asia soon and worse around the world. There are three things that people should be aware that mainstream media hasn’t fully covered thoroughly the truth out there.
First, the credit default swaps (CDS) in the banking system will be a bottomless hole that the governments and world banks cannot cover up and settle the outstanding derivative contracts. Based on the source from Bloomberg and Fortune magazine, there is $62 trillion dollars of CDS sitting in the system. Subprime MBS is NOT the cause of the current crisis. It was a tip of the iceberg. Who is going to pay/trade for CDS No body knows. Maybe, looking at Henry Paulson expression last week., he said it all. They must act now to buy more time!!
Second, the interbank rate (loan rate between institutions and banks lending to each other) has been UP UP UP for 1 month, 2 month, 3 month term-loan. NO significant adjustment occurs that we are out of the panic and danger area. The rate is telling us the banks DO NOT trust each other. Why bother lending to someone who might be in trouble later on?? Another important impact, small and medium businesses would be suffering from lack of liquidity to pay off payables and salaries. Just imagine taking out high rate credit line to pay off normal expenses. The owners would take major hit on this. Workers might not get their pay-check in the near future.
Third, misery index (unemployment and inflation) has been rising. Latest US employment report shows a 9 consecutive monthly job decline. Although the rate was unchanged, the government has been trying to paint a solid picture. The trend has been the same in Europe. Asian would not be alone. Japan is near recession and the exports sectors South East Asian countries would feel the pain eventually when US and Europe confirmed their economic recession. On the inflation front, the food and energy price have been stabilized but no adjustment due ot lack of demand. Therefore, normal citizens are continuing to pay high prices while the economic outlook is negative and workers might lose their jobs if new round of laid off occurs.
At this point, I don’t know what will happen, how will happen and when will happen. All I know for sure is that the banking system has been reverted back to 1907. YES. You read it correctly 1907. The turning point was when AIG needs 85 billions USDs temporarily loan from US Federal Reserve, the banking and insurance industries are virtually INSOLVENT with the exception of a few players such as Goldman Sachs, JP Morgan, Citibank, Warren Buffett standing w/ government backing and supports. If you look at a bigger picture, some Central Banks around the world holding US notes and dollars are taking major hits in their portfolio. The $770 billion law only allow more time for politicians and bankers to buy more time to do MORE coverup.
So, time to start use ATMs and get some cash. Collect silver and gold coins to protect your assets. Good luck!!
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