Financial Sense Blog

The stock market took yesterday’s report that new home sales rose to 330,000 units in June as a positive.

At long last, a good portion of mainstream economists now concede that a 'double dip' recession is in the cards for the United States. To head off the pain, sixteen top economists addressed an open letter to the President urging him to "stimulate" the economy with a massive new round of government spending. We feel this is a recipe for driving a recession into a depression.

I want to discuss something that came up on the blog Friday. An anonymous poster hinted that we were going to see more gold weakness in the days ahead because big money had to sell their positions. Folks, big smart money traders don’t sell into weakness. These kinds of investors don’t think like the typical retail investor who is forever trying to avoid draw downs.

In this series of Articles, I "interviewed" six Presidents from Washington to Kennedy on things that I believe still apply today. In this summary, I will attempt to cover what I learned from these people who expressed wisdom that has stood the test of time.

It’s time to do a little inventory of market signals, economic signals, and earnings signals to get a reading in the tea leaves on market and economic direction. Right now, the signals look mixed. I think it’s pretty easy to argue both a bullish and a bearish case. Let’s break up the individual signals to get a checklist going of the good and the bad starting off with the stock, bond, and currency markets.

If "fundamentals" drive trend changes in financial markets, then shouldn't the same factors have consistent effects on prices?

I don’t have a crystal ball, but I’ll bet I can tell you how much a house will cost in five years. UBS released some interesting research last month on how much gold it takes to buy the average-priced home in the U.S. I put the data to a chart, and it’s quite revealing.

Ben Bernanke spoke this past week and was quite frank during the first day of testimony. The markets plunged as a result of his talk of the economy being “unusually uncertain”. I’m sure his unusually candid remarks sparked an evening of calls by some of the highest members on high finance in the US who pleaded with him to expunge his previous day’s honesty.

Adam Smith in his Wealth of Nations worked out the foundations of a second type of credit that is based, not on savings, but on consumption. Later this theory was pejoratively called “Real Bills Doctrine” by its detractors.

The trend is your friend and this article reviews the 7 most popular trend indicators to help you make an extensive and in-depth assessment of whether you should be buying or selling stocks, bonds, ETFs, gold or silver for your portfolio. If ever there was a “cut and save” investment advisory this article is it.