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Investors (sometimes called lemmings)
since time immemorial, have a distinct propensity to blindly follow the herd,
propelled by corporate-banker-media public relations fiction.
This week, we continue with a list of Common
Misconceptions in Today’s News that we started last week.
Common Misconceptions in Today’s
News – PART TWO
Fund managers know better than you where
your hard earned money should reside. They prefer that it be in their fund
where you must park it for years. This way they can take their 1-2% annual
fee plus an average 20% of the net. While we are certain they would like to
earn nice gains for you, the reality is, many of these managers could care
less as long as they get theirs. This game is a goner in our view. We are not
totally against buy and hold but rather suggest that trading often (not day
trading) has distinct advantages. Look over the following ideas and misconceptions
we think are fraught with wild risk.
17.) It’s easier to open a new USA
business now than ever before. Loans are available and sales are out there
for the taking. Try to get a new business loan and you will quickly learn
otherwise. Even large, stable companies cannot borrow as before because
bankers would rather take the spread on government bonds, pay themselves big
bonuses and keep the taxpayer cash in their till with no perceived loan
risks. At the end, this all fails anyway and the fiat paper collapses,
collapsing those banks; too bad for them. Have you noticed how many are
leaving the banking business? One reporter said over 600 prominent bankers
resigned just this year. What do they know that they aren’t telling us?
18.) Middle Eastern wars and social
problems are over. Peace and prosperity are just ahead. War is big
business and defense companies in the Western World need a steady stream of
demand for their stuff to burn and get blown-up so they can make and sell
more. The Middle East is on fire primarily due to religious differences,
greed, blackmail, politics and the insanity of old men in funny clothes. War
will spread, not diminish. The scary part is that nuclear devices are out
there in never-never land, missing and not under any control. It’s only
a matter of time.
19.) We are winning the hearts and minds
of folks living in the Middle East. Policy, politics and religion within
the Middle East are quite different than those of their neighbors and western
world nations. Thousands of years of ideas instilled in minds throughout the
region will not change, ever.
20.) The $16 Trillion in USA debt is
manageable. We just need more time to work our way out of it. There is no
possible way to extricate from this debt or most of the debts in other
nations dumped on taxpayers and governments by central bankers to promote
their schemes. In the USA, the Federal Reserve could write-off many billions
in phony issued paper and cooperate to balance the USA national budget; but
this never happens. It ends the hard way with crashing bond market values and
collapsing economies. It either gets paid or it’s written-off.
Written-off = the ending.
21.) Send your kid to college, and load
‘em up on student debt and there will be a
great job out there right after graduation. Thousands of kids have shiny
new degrees and no jobs. Yet, the trades are crying for help and have work
for trained youngsters right now. The problem is we have too many college
degrees and no demand for those skills. Yet, trade jobs demanding training go
begging. Colleges and universities impose big bills on kids that take years
to repay. It’s better to get a degree on the Internet for $7,500 (four
years) and keep working and living at home while going through it. Some degrees
obviously have mandatory campus residency but so many do not. New reports
tell us one million freshly minted college grads from the class of 2008 have
gone home to live with their parents, as they cannot find work.
22.) The new Obamacare
Health Plan will work fine and it’s cheaper and better than old ideas. As
one congress woman said, “We have to pass the law to see what’s
in it.” Well it’s passed and many still cannot see what’s
in it and these new rules have turned into a huge expensive mess…if in
fact the law stays on the books. It’s our view that many just pay the
fine and stay away from it. Medicine will be ruined over years. It’s
already a mess with needless and very expensive healthcare plans. We are not
health care experts, but things worked fine before HMOs were introduced. We
opt to pay cash and get a -38% discount. This shows us what HMOs really cost.
23.) Illegal immigration is under
control and the social make-up of the NEW United States is being managed for
a great and golden future. We’ve noticed certain immigration
problems have been resolved as 1.4 reported million Mexican folks simply went
back to Mexico as there was more available work there than in the USA. What
does that tell us about our nation? Other nationalities are pouring into the USA
and Canada having long-term and very serious implications. As the story goes,
these billions in new welfare burdens will hammer the national economies
creating other kinds of social problems due to no assimilation into American
society.
24.) Just because there are 50 million
on food stamps doesn’t mean those folks can’t get a job. The
unemployed jobless rate in the USA is only 8% or so. That number can be
managed. True unemployment in the USA is 25%. That includes those
receiving welfare checks, those getting no checks and thrown off the rolls,
and those vastly underemployed working only part time at minimum wage to eat
and survive. Numerous former major industries like housing have been nearly,
totally ruined. Good manufacturing jobs are mostly gone forever to foreign
nations on pure economics. The very fabric of society has been permanently
changed.
25.) All of those thousands of
bureaucratic rules, red tape etc. won’t hurt current or new business.
Small business in the USA is leading the way out of the recession. National,
state and local governments have the ability to keep passing stupid rules. To
justify their very existence they insist on new and ridiculous laws and rules
creating such a burden with “politically correct stuff” that
small business cannot grow, many are failing and new ones are not being
started. This red tape load is just too much to carry and deal with for small
business people.
26.) Big companies have loads of cash
and will spend it on expansion and new jobs. Big companies have slimmed
down, and are not hiring but rather finding ways to fire more employees
and/or have one person do the job of three or four. They are saving cash to
survive Greater Depression II with reduced sales demand and higher expenses.
This is a no-growth negative environment that continues until the next world
war.
27.) All government large and small is
shrinking; it not expanding. Salaries, benefits and working conditions in
governments greatly exceed private industry and business. Some are reducing
employment rolls but only if they are forced to do so having no funds. Unions
don’t care and continue to ask for more in a contentious environment.
Eventually, some government bodies file bankruptcy and then do not have the
ability to sell bonds to continue operations. Some political entities have
merged with counties, or other towns and cities. It just keeps going until
there is no way out.
28.) Defense industry spending is being
curtailed. Our nation is at greater risk. Some kinds of very expensive
defense products like certain missiles or airplanes are being mothballed.
However, the defense industries shall continue forward making stuff for war.
When the next war begins, expansion begins anew and more spending is the norm
with dramatic waste throughout the process. War is the ultimate jobs program
as civilians make war products and soldiers go fight.
29.) Free speech remains the norm. You
can do or say anything you wish. This nation is free. There is little
peace and tranquility among many cultures as several are
jealous of the others getting more free stuff. This creates dissention,
rivalry and violence. Politically correct speech has gotten ridiculously
childish. It has gotten to the point where people either say what they think,
argue and fight; or say nothing for fear of offending someone. Free speech is
no longer our MO. Political correctness has trumped.
30.) Government leaders worldwide have
things under total control and really know what they are doing. There are
so many problems in the world created by economic imbalances that several new
and serious problems have emerged. If we had the time and inclination we
could easily list 100 things that would set-off serious problems domestically
and internationally. World leaders are figuratively going to “step in it”
and then the real adventure begins. Who knows where or when?
31.) The president’s re-election
is good for the United States and the world. These folks are very smart, work
hard and will do the right thing for us and for the world at large. There
are thousands of others reporting on the elections having information that we
do not. We have seen so many defective and negative things regarding
elections we’ll just refrain from comment on this one.
32.) Politics and voting are fair and
balanced. There are rules and they will be followed very carefully. There
is great fear of voter fraud and unfair elections in several nations and
states. We noticed lawsuits on this in Nevada in the last election and expect
it to spread. We suggest that all eligible voters get out and vote. If you
don’t vote you can’t complain. Hope for the best.
These ideas are common in the news and
on the street.
If you believe this nonsense, you will believe anything. Wake up!
In closing, we will reiterate what
works.
Stuff That Works
Understand your market and educate
yourself to do a few things right. You do not need 50 stocks and 40 others to
make money. Some of the best of the best do only one thing. Look where you
would be right now if you had piled into physical gold and silver in the year
2000.
While all eyes are on Europe’s
destruction, the USA’s test comes November 6th. It might even arrive
sooner if the broader stock markets slide out of control during September
23-25.
Meanwhile, we suggest you gravitate
toward physical gold and silver and only the best-of-the-best of related
stocks supporting that view. In our work, we are busy looking for options and
selling ideas for the broader stock markets heading toward the dustbin of
destruction. Last week we recommended two new ones in Trader Tracks
Newsletter. We see more coming in this new seasonal beginning.
The Greater Depression Repression II
is swiftly taking hold now and layoffs will be legendary. Housing has an
additional -20% drop from the current USA national average. Joblessness goes
to 30%-35% and food stamps reach over 50 million to 60 million. We will get a
2013-2014 World War in the Middle East and when Obama is reelected, inflation
goes to hyperinflation. Not happy stuff but it’s not the end of the
world either.
Somebody please tell us when the global
bond markets crash for good and we’ll tell you when this can all get
better and we can start all over again, maybe with a partially backed fiat
gold currency.
Roger Wiegand
www.webeatthestreet.com
Contact Claudio Bassi, at Trader Track’s New York City publishing
offices for a trial subscription. Call
718-457-1426 Monday through Friday, 9:30am to 5pm or,
e-mail cbassi@miningstocks.com
Recommendations made in “Trader Tracks”
are exclusively those of Roger Wiegand and the
publication is also exclusively the editorial content provided by Roger Wiegand. TAYLOR HARD MONEY ADVISORS, INC. (THMA)
LOCATED AT 33-42 61ST STREET, WOODSIDE, N.Y. 11377, ASSISTS IN THE MARKETING
OF “TRADER TRACKS.” However, the views expressed in Trader
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Because individual investment objectives vary, this summary of investments
should not be construed as advice to meet the needs of any particular reader
or subscriber. Opinions expressed in Trader Tracks are statements of judgment
expressed at the date and time they were written, and as such, are subject to
change without notice. Roger Wiegand is not a CFA
nor an investment advisor, but a private individual who studies the markets
extensively and offers summary opinions. Before any type of investment is
made, you should always seek advice from your attorney, CPA, registered
broker, or financial advisor. There is considerable risk in market
speculation and investing. There are no guarantees regarding performance and
past performance provides no guarantee of future performance. Your trading
accounts are always subject to the potential for severe or total losses. This
service will involve SPECIAL EMAIL ALERT TRADING RECOMMENDATIONS PROVIDED
AT ANY TIME Roger Wiegand believes it is
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Trader Tracks. No statement or expression of any opinion expressed herein
constitutes an offer to buy or sell the securities mentioned herein. Trading
futures contracts may not be suitable for all investors. You may lose a
substantial amount of money in a very short period of time. The amount you
may lose is potentially unlimited and can exceed the amount you originally
deposit with your broker. This is because trading futures is highly
leveraged, with a relatively small amount of money used to establish a
position in assets having a much greater value. If you are uncomfortable with
this level of risk, you should not trade futures contracts. If you need a
broker, contact mine, Ryan Olson, Managing Partner, Jackson-Olson commodities
at 800-352-5228 or by e-mail rolson@jacksonolson.com Contact Jackson-Olson Commodities,
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& bonds, futures & commodities, contact Claudio Bassi
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