Global Gold Demand Up U.S. Dollar Down
China the world’s largest gold producer is set to break records for both production and consumption of gold. China over took South Africa, in 2007, to become the World’s largest producer of gold.
“Gold demand may be more than 450 metric tons compared with 395.6 tons in 2008, and output may climb to 310 tons, compared with 282 tons a year earlier, Zhang Yongtao, deputy secretary- general of the association, said at a conference in Kunming yesterday.”
Source: Bloomberg News
Gold is now flirting with a $1,200 an ounce (11-26-09). The continued weak U.S. Dollar could push a $1,500 an ounce sooner than later.
“The inflation concern this year has boosted the Chinese consumer demand for things like property, autos and gold…” This demand for hard goods vs. U.S. Dollar will most likely push China past India as the number one consumer of gold.
Read the full Story here:
Also, 60 Minutes did a story on Gold production from Congo and its tie in with the bloody conflict in that region. Story and video here:
Recession Will Be ‘Full-Blown Depression’: Strategist
“This global recession will turn into a “full-blown depression,” Nicu Harajchi, CEO of N1 Asset Management, said Friday, adding that global stimulus hasn’t come down to Main Street.”
“When it comes down to corporate America, corporate Europe or even in Asia, in Japan, we are not seeing Main Street making any money,” he said. “Consumers are losing their jobs. They are struggling with their mortgages, with their credit. And we are just seeing this continuing.”
The $5 trillion injection is “monetary expansion,” according to Harajchi. “At some point, which we believe to be 2010/11, some of the central banks are going to recall some of that money and that will turn from monetary expansion to monetary contraction.”
He also said he doesn’t see the corporates or the public “being able to pay back that debt.”
You can read the full article here
FREE Foreclosure Survival Event for Homeowners in Arizona
I’m holding an event for homeowners in Phoenix on October 6, 2009.
I’ve assembled a team of experienced professionals, including an attorney, a coach, a loan auditor and a loan modification processor, to answer your questions about loan audits, loan modifications, bankruptcy, foreclosure and litigation for TILA/RESPA violations, and other related topics.
If you’re not sure if you want to spend the money on a loan audit, I’ll be conducting free-mini loan audits for anyone in attendance, so bring your closing documents to the seminar.
I will also give away a full forensic loan audit to one lucky attendee, and I’m offering everyone else $100 off a loan audit just for attending this seminar.
The room will only hold thirty people, so please go here to register and save your spot.
Homeowners are the Losers in the Bailout
With foreclosures increasing and short sales increasingly difficult to get approved by the banks, many homeowners are at a loss given the dwindling options to save their homes.
Sure, you can get a loan modification from your lender and reduce your payments by $300, but you’re going to be in debt for another ten years. That means your total loan term is forty years.
Think about that for a second. Forty years? Is this really in the homeowner’s best interest?
I don’t think so.
Most people need a principal reduction to make staying in their homes a good financial decision. However, most lenders will not voluntarily give you a principal reduction.
What really angers me about the mortgage mess is that the lenders in this country screwed homeowners when they wrote these loans. Then the real estate bubble burst and the United States government wrote them a big check from the taxpayers to shore up their balance sheets.
And what happened? They stopped working to help homeowners! That’s right America, your taxpayer dollars gave the lenders enough money that they don’t need to work with you to keep you in your home.
You see, with your taxpayer dollars, they don’t need to negotiate to save themselves from implosion because your money is keeping them afloat. They have no incentive to work with you.
Even worse, lenders will profit again by handing out bad loan modifications like candy to homeowners who don’t realize they are getting a bad deal. Usually, they include dropping the interest rate to somewhere around 3.5%, extending the terms to forty years, and adding on all undisputed late charges, missed payments, fees and anything else they decide to add on because you won’t know the difference.
Think about how much money the lender is going to make on your loan, even at 3.5% for forty years. A lot!
So how can you make sure you’re not being taken advantage of?
First, get a loan audit.
Yes, they’re several hundred dollars. But wouldn’t you rather know if you were the victim of predatory lending before you accept the lender’s boilerplate loan modification agreement? Sign it and you waive all your rights to sue the lender for predatory lending.
You won’t know if you were the victim of predatory lending until you get an audit.
You have more leverage against the lender if there are violations of TILA/RESPA than you do if you’re begging for their help under a hardship situation. A loan audit and a lawyer in your back pocket will force the lender to deal with you or they know you’re going to sue them.
Second, hire competent legal counsel to review any loan modification agreement you receive from the lender. Part of the problem with the mortgage mess is that the documents that are standard at closing are too complicated for the average person to understand.
Spend the money for an hour with an attorney and make sure you understand what you’re signing before you sign it.
Audit the Federal Reserve: HR 1207 and S 6055
This is not about Politics, this is about our Country. We need to know what the Fed is doing. Please Support HR 1207.
“Ron Paul’s bill to audit the Federal Reserve (HR 1207) now has 245 co-sponsors, and the numbers keep growing! HR 1207’s companion bill in the Senate, S 604, is now beginning to attract its first co-sponsors!”
Step 1: Your Representative
If your representative is not on the following list of HR 1207 co-sponsors, call their offices, write to them, email them. Let them know they need to support HR 1207. If you live in their district, let them know. Go to their office.
Capitol Switchboard: (202) 224-3121
Step 2: Your Senator
HR 1207’s identical companion bill in the Senate is known as S 604, the Federal Reserve Sunshine Act, sponsored by Sen. Bernie Sanders.
If your Senator is not on the following list of S 604 co-sponsors, call their offices, write to them, email them. Let them know they need to support S 604. If you live in their district, let them know. Go to their office.
S 604 Co-Sponsors (as of 6/26/2009)
Sen Crapo, Mike [ID] – 6/25/2009
Sen DeMint, Jim [SC] – 6/11/2009
Sen Vitter, David [LA] – 6/16/2009
Step 3: Financial Services Committee
HR 1207 is now in the House Committee on Financial Services. This is THE MOST IMPORTANT STEP in this legislation! If it doesn’t get out of committee it will not come to a vote! There are 71 members on this committee and they are all listed below.
We need to let all members of the House Committee on Financial Services know that we want them to allow full House consideration of HR 1207 so it can move forward; we need them to support this. Now is the time.
Call their offices, write to them, email them. Let them know they need to support HR 1207. If you live in their district, let them know. Go to their office.
Source: http://www.ronpaul.com/on-the-issues/audit-the-federal-reserve-hr-1207/
Click the More Link to see the video:
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U.S. Jobless Rate Explodes
Caterpillar announces fourth quarter profits drop by 32%. Caterpillar announces it will slash 20,000 jobs.
Sprint Nextel announced they will emanate 8000 jobs in the first quarter of 2009. Job cuts will affect every level of the company.
Home Depot to cut 7,000 jobs which represents 2% of its workforce. Home Depot also announced they will shut down their Expo division.
Texas Instruments reported a large profit drop which led to the announcement it will cut 3400 jobs
IBM will cut at least 20,800 jobs. This announcement comes just a few days after Microsoft announced they will be eliminating 5000 jobs.
Layoffs are coming from every sector of the economy, which is troubling because it represents a wide and deep recession. It is now expected January will see another 500,000 jobs evaporate.
On a side note
Falling home prices in December pushed existing home sales up by 6.5%. Bargain hunters snapped up foreclosures, taking advantage of the largest price decline in 70 years. 45% of the homes sold in December consider distress sales, either short sales or foreclosures.
2008: The year in markets (from MarketWatch)
U.S. indexes
Dow Jones Industrial Average -34%
S&P 500 -38%
Nasdaq -40%
Dow Jones Financials -55%
Amex Oil Index -37%
International indexes
Germany DAX -40%
FTSE 100 -31%
Japan Nikkei 225 -42%
China Shanghai Composite -65%
Mexico IPC -24%
Brazil Bovespa -41%
Currencies/commodities
Gold +5%
Crude -54%
Dollar index +6%
Pound vs. dollar -28%
Dollar vs. yen -18%
2008 Numbers provided by MarketWatch.com
The Republicans are Right NO Bail Out
Update:
For all of you who argued with me about the big three missing market trends in relation to SUV vs. Hybrid, hear straight from the horse’s mouth. They acknowledged I was right.
“We also biased our product mix toward pick-up trucks and SUVs. And, we made commitments to compensation plans that have proven to be unsustainable in today’s globally competitive industry. We have paid dearly for these decisions, learned from them and are working hard to correct them by restructuring our U.S. business to be viable for the long term.”
Again, yes there was a demand for SUVs but it was a downward trend. They did not see the upward trend of green cars…
I just watched Henry Paulson fumble his way through a Congressional hearing regarding the Wall Street bail out, and as a tax payer I was not pleased. However, Paulson and the current Republican Congress are against giving the Detroit based Auto industry $25 billion in bail out money. I agree.
In early 2000 the leadership of the “Big Three” missed the trend from gas guzzling SUVs and trucks to more full efficient cars. Maybe the Auto industry leadership thought the “Rock and Roll” bubble economy would never end. Perhaps the industry was simply too “drunk” on their boom time success and they took their eyes of the shifting and evolving markets. Meanwhile, their competitors, Toyota and Honda soared into the top spots, riding the hybrid wave. Markets called out and the Japanese Auto industry responded in spades. When I drive around Los Angeles it seems like every other car is a Toyota Prius.
If the Big Three do not get a bail out, they will be forced to restructure their business. This is not a bad thing. This is the free markets doing its job. Out of the restructure will come a leaner and meaner Auto industry. A government bailout will only reinforce failed leadership in Detroit. When American companies are forced to refocus and do more with less, amazing innovation takes place. America needs innovation and not bailouts.
President Bush Now Believes in Free Markets
President Bush is pushing for free markets when it comes to the faltering economy and global financial meltdown!!
I agree 100% with Bush. I do have one question. What happened to FREE MARKETS when we bailed out the banks and Wall Street? (Who are not lending out any of our Tax dollar bail out. They are hording the capital!)
You can’t suspend free markets one day and then believe in them the next. I agree government has a role in our economy but we need to let the principles of the free markets work. It is the foundation of capitalism!
Out of this recession, better companies will arise. We always bounce back and we always will. We just need to let the free markets work. Yes, it will be painful but it’s necessary.
Will Home Prices Bottom Out In Late 2009?
Source: NYT
According to the New York Times, they are reporting falling home prices through late 2009. “The No. 1 thing that drives housing values is incomes.” States Todd Sinai, professor of real estate at the Wharton School at the University of Pennsylvania.
First, here in California we will be lucky if it’s 2009 when we see the bottom. I think we are looking 2010 or 2011, until we hit bottom. This is supported by the last California housing boom and bust of the 1990’s.
“In a previous boom, home prices peaked in the Los Angeles area in 1990 but did not hit bottom until 1996. Prices remained near that low for more than a year before starting to climb again.”
Second, the fact that home values are now based on incomes is shocking. By not using income as the measure if a person can afford a home, is what caused the housing bubble and collapse.
