Gary Dorsch's Contributions

Politicians running for the US Presidency, and their surrogates, are fond of saying “that this election is the most important of our lifetime.” They invoke this cliché so reflexively and so often that it no longer has any meaning.

When will the Fed’s folly and madness come to an end? Perhaps next year, we’ll begin to see big changes at the Federal Reserve, including the sacking of Fed chief Ben Bernanke, and his henchmen of addicted money printers, who have tossed aside the notion of “Moral Hazard,” a long time ago...

For most of Wall Street’s history, trading in equities was fairly straightforward: buyers and sellers gathered on exchange floors and haggled until they struck a deal. Computerized trading of stocks didn’t arrive onto the Wall Street scene until the 1980’s. Computer guided “Program trading”—defined by the NYSE as an order to buy or sell 15-stocks or more—valued at over $1-million total, was blamed for the “Black Monday” Crash of October 1987.

In the opinion of the Global Money Trends newsletter, the Fed is trapped in a political minefield, and won’t offend the Republican Party. Therefore, the Fed is expected to stay politically neutral ahead of the Nov 6 th elections, and leave QE-3 on the back burner (assuming Greece does not exit the Euro).

Gerald Loeb was most of the most respected analysts on Wall Street, during the Great Depression years and through the following decades. He wrote an epic book, titled “The Battle for Investment Survival,” last published in 1965. Many of his pearls of wisdom, concerning the financial markets and rules of investing, have withstood the test of time.

In 2009, China spent $89-billion for imports of crude oil, $50-billion on iron ore, and $30-billion on copper. However, even before the final tally for 2010’s import bill is calculated, Beijing understands that the era of cheap commodities is over, and that if continues to target economic growth of 9% or more, it’ll have to pay a heavy price.

South Korea has long operated under the threat of Pyongyang’s nuclear weapons program. But the threat hasn’t stopped the South’s rapid emergence into the world’s fifteenth largest economy, and an elite member of the Asian Tigers, along with Hong Kong, Singapore, and Taiwan. In 1980, South Korea’s economic output per capita was $2,300. Since then, its GDP per capita has grown to $30,000, almost thirteen times larger than thirty-years ago. Likewise, South Korea’s economic output has increased from $88-billion to $1.46-trillion during the same time span.

The ink had barely dried on the October 24th, G-20 communiqué, aimed at averting a global trade war, before cynical currency and commodity traders began doubting its durability, and seeing it as a simple propaganda ploy. G-20 finance chiefs agreed in Gyeongju, South Korea to refrain from massively printing their currencies to promote exports, and instead, to allow markets to decide foreign exchange values.

With the price of gold zeroing in on yet another major milestone--$1,300 /oz-- some heavy hitters in the marketplace are beginning to wonder if the yellow metal’s rally is getting a bit too frothy, or even worse, whether a speculative bubble is brewing, that might ultimately deflate under its own weight and lead to a sharp correction. On Sept 15th famed hedge fund trader George Soros said that gold prices might continue to rise, but warned that that gold is the “ultimate bubble.”

“I care not what puppet is placed upon the throne of England to rule the Empire on which the sun never sets. The man that controls Britain’s money supply controls the British Empire, and I control the British money supply,” declared Baron Nathan Mayer de Rothschild, once the richest man in Europe. In 1840, NM Rothschild was appointed as the bullion broker to the Bank of England and went on to operate the Royal Mint Refinery in 1852.

The US–economy has not experienced sustained deflation since the Great Depression of the 1930’s, when consumer prices fell 10% between 1929 and 1933. But Japan has been battling falling prices since 1995, – triggered by the bursting of the Nikkei–225 equity bubble, and a unrelenting slide in land prices.

Of ten people who hear the same story or speech, each one might understand it differently. Perhaps, only one of them will understand it correctly. On July 21st, Federal Reserve chief Ben Bernanke was speaking in riddles, as central bankers are apt to do, while delivering his testimony before Congress. Each word that’s uttered by the Fed chief is scrutinized by anxious speculators, who try to interpret the message correctly before quickly placing bets in the marketplace.

Trying to pick a winning trade in the foreign exchange market is similar to judging a “reverse beauty” contest. In other words, one must be able to identify the least ugly currency among its peers, at any given moment in time. All paper currencies are considered to be ugly, when compared to the “king of currencies” – Gold, since the central bankers are apt to print vast quantities of fiat currency, at the behest of government officials who have appointed them to run the printing presses.

The value of Gold has been subject to intense debate for centuries. Nathan Mayer Rothschild was once the richest man in Britain and probably in the world. His company, NM Rothschild, was appointed as the bullion broker to the Bank of England in 1840 and went on to operate the Royal Mint Refinery in 1852.

Copper is often referred to as the metal with a Ph-D in macro-Economics, since it finds its way into so many industrial applications, including automobiles, appliances, airplanes, pipes, wires, and even computer chips, to mention just a few of its uses. As such, it acts as a top forecaster of where the global economy is heading next, especially China, Asia’s economic locomotive. Copper is a favorite tool for speculators in the commodities markets, given its cyclical nature and volatility.

Until mid-April, few traders knew much about the credit default swap (CDS) markets. They’re traded on an unregulated, over-the-counter market, and far from the public’s view. Yet nowadays, the CDS market has become a major battleground between high-stakes speculators and Euro-zone politicians, with the fate of the Euro currency hanging in the balance.

“As soon as you think you’ve got the key to the stock market, they change the lock,” lamented Joe Granville, who is mostly remembered for his bearish calls on the US stock market during the 1970’s, 1980’s, and the 1990’s.

Jesse Livermore, the world’s greatest trader used to say, “Remember, the market is designed to fool most of the people most of the time. Sometimes, the market will go contrary to what speculators have predicted.

Every business day, an estimated $3.8 trillion is changing hands in the vast network of the world’s foreign exchange markets, which never sleeps and is growing by leaps and bounds. The foreign exchange market is the first port of call for global investing...

“A trend in motion, will stay in motion, until some outside force, knocks it off its course!” After watching the parabolic rise in crude oil prices, doubling from a year ago to above $130 a barrel last week...