In the late 90’s the Fed held rates too low, too long, creating a bubble. When it popped it created a financial catastrophe and ultimately a recession.

From 2001 to 2006 the Fed held rates too low, too long, creating another bubble. When it popped an even bigger financial catastrophe and a deeper recession resulted.

Now the Fed has held rates at zero for 8 years and printed trillions of dollar of QE….

Do you think it’s going to be different this time?
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14 thoughts on “FOOD FOR THOUGHT

  1. Alexandru Popovici

    Zkot, here you have my reply to you:

    “ZKOT, thank you, man, for your recommendation. I put it on my list right after the ongoing Larry Williams reading.

    JPY and EUR seem to have set both their YCLs so that USX has topped.
    JPY at least has got a very very long yearly cycle.
    Evidence of that should come next week when I expect both EUR and JPY to produce strongly right-translated daily cycles (USX to continue its fall) and to correct in daily cycle declines in the week post-jobs report before resuming higher (USX to extend its intermediary cycle through FEB via a left-translated daily cycle – ICL on week 24 or so).

    An overally bearish USX till USX’ ICL in FEB should set stocks’ YCL –> THE VERY HIGH FLAMES OF THE SCORCH!”

  2. jskauai
    I like Jason he has a good head on his shoulders. In regards to his precious metal miners observations, which he believes that the mining companies dance to the banker’s tunes, I agree with this. In most part there is no outspoken leadership among the miners. Keith Neumeyer may be the exception but he is a lone voice. I like to make the analogy of the miners to the golden goose fable. So I credit those entities who are the controlling forces in the gold/silver space to understand that golden goose fable. The miner are the golden goose if you kill the goose by pushing price of gold/silver below AISC then they will lose control of the price mechanism. They may not bankrupt the miners but it will cause the miners to curtail production which = reduced supply. This would cause a run away bull market in PMs, IMO.

  3. GMoney

    Also Gary, government and corporate debt has increased by an insane amount over the past 8 years. The world is choking on debt and mathematically most of it won’t get paid back. We are living in the most bizarre economic times the world has ever seen

  4. ras

    Markets are too complex to accommodate the opinion of any individual analyst. Sometimes, a gifted analyst’s mind resonates with the market tide and he makes a successful call. At times, this may not happen. So, we have ups and downs in the SM letter business too. Entirely natural.

  5. SLEP

    Gold and silver haven’t reached their bottoms, yet. Gold had a bearish Key Reversal on Friday; it’s 200 DMA is declining; it’s 50 DMA is declining; it’s Bollinger Bands Center Line is declining; it’s Keltner Channels Center Line is declining; and it’s YCL doesn’t bottom until about January 31 or the first week in February (according to the FSC).

    Silver had a Engulfing Bearish Candle on Friday; it’s Slope (Linear Regression) is declining; it’s MACD is bearish; it’s Bollinger Bands Center Line is declining; it’s Keltner Channels Center Line is declining; it’s TSI is bearish; and it’s YCL doesn’t bottom until about the same as gold’s, perhaps a week later. Therefore, folks, gold and silver are going down, Baby!

    I like this quote: “Trade what you see, not what you Think.”

    1. Gary Post author

      What chart are you looking at?
      Everything but MACD is turning up from oversold levels.

      All the indicators you sited are lagging indicators. By the time those turn up you will have missed most of the move.

      1. Gary Post author

        On the daily charts all indicators except the RSI are moving up.

        But of course that doesn’t mean they can’t turn back down. So I’m happy to take my profits and wait to see what the beginning of next week brings.

  6. Goild

    I like very much the quote.
    Thanks for bringing it up.
    However, I see the miners going up.
    If you merge the miners last two candles they are continuing an upward trend. The miners are going up, cannot you see it?

  7. Don

    Gary, you don’t sound very sure of yourself in the video. I think you are lost and no longer have a clue. Your cycle work has failed repeatedly with nearly every cycle being ‘stretched’ or cut short by the ‘manipulators’. Heck, just one day after telling everyone that ” In bull markets all timing mistakes get corrected”, you bail out at the first sign of a sell off with the excuse that you are locking in profits. Such short term trading mentality is exactly what you have chastised others for doing in the past. You talk about how much your metals portfolio is up as if everything was bought at the absolute bottom, which, of course, is highly unlikely to have occurred without a crystal ball to pin point exact bottoms. Personally, I think that gold and the miners are headed higher but I have been wrong before. Thankfully, no one is paying me for bad advice.

    1. Gary Post author

      The portfolios are traded in real time.

      The leveraged portfolio is up 83% as of the last completed trade. I’m looking to get back in as soon as I get some sign that the sell off on Friday in miners wasn’t a sign the market is turning back down.

      Once I’m comfortable the intermediate rally is on sound footing then I’ll get in and stay in for the next 1-3 months barring something weird happening.

      Absolutely in bull markets all timing mistakes will get corrected. However, that still doesn’t stop any of you from forgetting it during drawdowns.

      Let’s assume that one bought miners in mid 2008. Then had to weather the drawdown into the 2008 bottom. I guarantee no one would have believed me if I had told them at that time that all timing mistakes get corrected in bull markets. But as you can see I would have been correct then just like I’m correct now. Unfortunately 99% of all retail traders can’t look past the next day or the next week. And subscribers can’t hold through drawdowns as we’ve seen so accounts have to be actively traded more than I would like.

  8. LiesandDamnLies

    I think Gary was right to stay away and watch the first few days of trading of the new year. Without intervention the general market would naturally fall because of the new year tax sell off.

    Will the intervention happen? Who knows just sit back and watch.

    I personally I think that without intervention the markets will fall hard for the first two weeks without any meaningful breakout upwards. It may cause a mini panic across the whole market maybe up to a 10% drop.

    If this happens just beware that that some of the GDX miners may be caught up in the sell off for a while until the market realise that they should be buying the rather than selling.

    The next few days will be interesting.

    cheers Lies

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