Are We There Yet ?!?

.
.

I think we may be about there.  

• The Fed is out of bullets.  It has interest rates at zero and has deployed all the stimulus it had in its gun.  It hasn't worked and there will be deep resistance to keep printing money.
• Repossessions are accelerating over last years levels despite all the efforts of the Fed.
• We're heading for another Recession, and I'd say we never left the one we were in. We may even be in Depression.  The highest unemployment rate  during the Great Depression was 25%.  Measured the same way, today's rate is 20% +
• The Great Depression was just getting started right when everyone thought it was over.
• The stock market rallied from the crash of 29 only to fall back to about the low point of the crash before rising steadily through to 1950 before it rose above the 29 level and stayed there.  Will history repeat?
• France and Germany's Latest solution for the Massive economic crisis caused by Ireland, Portugal, Italy Spain and Greece going bankrupt is to impose a financial transaction tax.  A tax of stock trades.  This will Kill the market by removing liquidity and won't help anything.  They've already banned short sales.  Anytime this has been done the markets have not gone up, they've gone down.

By doing such stupid things, there is now a Crisis Of Confidence.  This is what you saw in the markets today. The 'Big Money' does not believe Europe et al, or the USA has any ammunition left to actually solve a problem and money is running and hiding.

We are in new waters now. The period from the March 09 low through Yesterday was last chapter. We start the new chapter today. I have no idea where it leads, but I think it's gonna be painful and chaotic.

The stock market has rallied since March of 2009 because of the money printing.  As the dollar was devalued, assets like a barrel of oil or a share of IBM had to be repriced. Imagine "Today" the dollar is worth 1.00 and IBM sells for 100 bucks a share.  Tomorrow the dollar is worth 95 cents.  IBM sells for 106 bucks and is worth exactly the same as it was yesterday.

In short, if your 401K is up 38% but the dollar is down 40%, what have you gained?  Well, Negative 2% actually.  There never was a 'recovery'.  The market simply repriced assets as the value of the dollar fell.

Gold is the only thing I've been interested in investing in for a while now. I mentioned UXG before but it looks like UXG is not going to participate in the rise of the price of gold because they're not actually digging the stuff up yet.  The mines who are sifting it out of the ground and have significant deposits and/or low costs per ounce of obtaining it are being rewarded.  fwiw - NGD is one of my favorites now.

And NO, it wouldn't surprise me if the federal government finds a way to put its jack boot on Gold like it did during/after the Great Depression. 

Man, this sucks because obama and crew are doing the Exact Wrong things to stimulate Employment growth by shoving obamacare AND massive regulation down the throat of business. The co-founder of Home Depot recently stated that it would be Impossible to start a business like that in today's obama inspired regulated environment and added that the easiest and quickest way to reduce cost was to reduce head count.

Will there be a country left in Jan 2013 ?

.

.