Leave a comment

BUYING GOLD MINERS

As noted above, the “bear market” will NOT be over until the credit market is fixed. We are a long way from that being done, given the blowout in yields currently occurring.

In the meantime, use rallies to raise cash. Don’t worry about trying to “buy the bottom.” There will be plenty of time to see “THE” bottom is in, and having cash will allow you to “buy stocks” from the last of the “weak hands.” 

__________

Monday March 30, 2020. HUGE short squeeze last week. Got a suckers’ rally and you could have done well by ‘day trading’. We were continually thinking about trading the 2X inverse funds. But not having the guts to take on the risk, we sat on the sidelines.

We did buy a very tiny position in gold, and also continue holding GGN which has been in the Portfolio forever.

We will be BUYING A SMALL position in GDX the gold miners.

It is quite stunning to see the numerous advisors out there shouting that you should buy stocks. We do NOT agree, and see further declines coming long term.

This is the end of the month with large funds positioning their portfolios. This week should be relatively flat with further declines in April.

Common sense tells you that with the country essentially shut down, you cannot see continued gains.

When we start coming out of this epidemic, the forward looking stock market WILL probably indicate a buying opportunity (maybe later this year)

Here is a very interesting article that we came across Friday. FULL ARTICLE

SCPA’s long term 100% probability forecast is for all eight of the global indices to bottom between September and November of 2022.  The probability is 100% for the markets of the countries to decline by a minimum of 79% below their 2020 highs and 50% for 89% below 2020 highs.  

Everyone should take advantage of the Bear market rally that is currently underway to GET OUT OF THE MARKET!   The bear who has arrived could potentially be more vicious than the 1929 bear market.

__________

We just learned yesterday that the FDA has approved hydroxychloroquine.

Here is an interesting article.

https://townhall.com/columnists/kevinmccullough/2020/03/29/hydroxychloroquine-help-is-on-the-way-n2565926

Leave a comment

REMAIN CAUTIOUS

March 27, 2020. Yesterday we bought a little gold with the intention to buy more: of course depending on market conditions which change hourly. The markets are pointing down this morning, and we expect further downside long term–maybe 10% to 15% more. Despite three days of upside, there is no way you can see continued gains when few people are working. (Scroll down for article.)

(We continue holding GGN, the gold etf, in the Core Portfolio. It is paying 19%)

btw If you have access to the Amazon streaming service, this is an excellent program:

Watch Mozart in the Jungle Season 2 | Prime Video

We came across this informative article that was published yesterday by Mike Turner, an advisor we have followed for years.

Question: How much of the stimulus package coming (eventually) out of Congress is designed to stimulate the economy? Answer: None. This is not a stimulus package; rather it is a subsistence package. It is designed to keep people from losing their homes and able to keep food on the table.

Question: How will the economy get back on its feet where the supply chain has strong demand and the supply of goods and services are plentiful when we are still locked in our homes for 2 to 4 more months? Answer: It won’t.

Question: How many times has the world’s global economy come to a complete and total shut down (a “sudden stop”) and then recovered immediately after the cause of the sudden stop is resolved? Answer: Never, because this has never happened before.

Question: When was the last time we had weekly unemployment claims of more than 3 million? Answer: Never.

2-part Question: What percent of the S&P 500 companies do you think will have strong earnings reports and even better forecasts for Q1? How many of those companies will have better results for Q2? Answer: (this is a guess) Very few.

Question: Why is it that when the Fed announced that it will dump unlimited amounts of Quantitative Easing (free money) into the economy, the stock market barely moved? Answer: The Fed cannot backstop a pandemic and it cannot kick-start the economy when the economy is shut down.

Question: How many main-street companies that were just barely making it, but able to stay in business, prior to the pandemic, will be able to come back (or even want to come back) once the virus is under control? Answer: Unknown, but likely many will not come back.

Question: How many people believe that all we have to do is to “flatten the curve” for the number of infections to solve the pandemic? Answer: Too many. Flattening the curve does nothing to reduce the infectiousness or mortality rate of the virus… it only stretches it out into the future and help keep our hospitals from getting overwhelmed with sick patients. The good side to this, is that flattening the curve will buy more time for a cure or treatment to be found. The bad side is still keeps us in a shelter-in-place mode for a longer period of time and continue to exacerbate the ramifications of a total economic shut-down.

Question: Does finding a cure or effective treatment for the virus, solve our economic problems? Answer: No it does not. The economy will have to come back and that will take a lot longer than many think.

Question: Did the market this week give us an opportunity to sell into the market at better price points? Answer: Yes, it did.

If you believe the market bottomed this week, then you are not looking at the same data I am looking at. Granted, my data are backward looking, but even with the huge run-up in the market this week, the Total Market Index is still 2.92 standard deviations below the 200-day moving average. And, the 200 dma is still trending sharply lower. While this week ‘could’ have been the bottom, my data and my observations of market conditions indicate that we will, more than likely, retest recent lows and ‘could’ move much lower. But, that is merely a guess and I do not guess. My data tell me to be short this market and nothing yet has transpired technically, to tell me to do otherwise.

This is why I put a small amount of capital to work in inverse ETFs in Tactical Growth, Total Market, Ultra and Diversified Income. It is also why I went 100% into our 2x ultra ETFs in ULTRA-MAX today.

If I am wrong… meaning my data are not yet reflecting the true trend of the market, and that is always possible when markets make sudden trend reversals… then, we will stop out, move to cash and begin buying fundamentally strong, up-trending stocks and ETFs. If my data are correct and if I am interpreting those data correctly, we could pick up some great gains in capital appreciation in the next few days, weeks or even months.

I like to say, “The market is never wrong.”… but, it can be very stupid at times and, in my opinion, it is dumb as a brick right now. We’ll see in the next few days if I am right or wrong.

Stay safe, be positive, be glad that you are not trapped in a buy-and-hold investment strategy and having to worry about “rebalancing”, which is a reserve term used by buy-and-hold investment firms to make themselves seem above the fray and never have to justify losing their clients’ money.

Leave a comment

BUY GOLD

March 26, 2020. We bought a tiny starter position in IAU.

iShares Gold Trust
Ticker Symbol: IAU     CUSIP: 464285105     Exchange: NYSEA Security Type:   Index ETF  —  ETF SubType:   Commodities Index ETF
Company’s Online Profile

FUND DESCRIPTION:  iShares Gold Trust, formerly iShares COMEX Gold Trust, issues shares representing fractional undivided beneficial interests in its net assets. The assets of the trust consist primarily of gold held by a custodian on behalf of the trust. INVESTMENT OBJECTIVE: The iShares Gold Trust seeks to reflect generally the performance of the price of gold less the trust’s expenses and liabilities. The iShares Gold Trust is not a standard ETF. The Trust is not an investment company registered under the Investment Company Act of 1940 or a commodity pool for purposes of the Commodity Exchange Act. Shares of the Trust are not subject to the same regulatory requirements as mutual funds.
Leave a comment

BOTTOM? DON’T BET ON IT

NOW IN OUR 8TH YEAR. NOTE TO NEW READERS: Before you buy anything we discuss here, GO to the Core Portfolio tab to see a CURRENT listing of holdings. Don’t forget to hit the like button. Our host WordPress is running ads in the blog and we receive NO compensation from this advertising.

March 25, 2020. Markets went thru the roof yesterday. But don’t get sucked into thinking that the stock market ‘bottom’ is in. Virtually the entire economy is shut down. We are entering a recession. Do you really think now is the time to buy??

If you see a short term rally in the next few days, we suggest you SELL. (Still holding all Corporate Bonds in the Core Portfolio.) We project further declines-long term-but continue adding to our ‘buy’ list. We want to be ready when things really turn around.

__________

The local pharmacist tells us that the state of Illinois has banned filling prescriptions for Hydroxychloroquine-the potential virus cure that Trump has been touting. How sad.

__________

Tuesday. The corrupt despicable Congressman were crowing about how ‘well they were working together’ to get the spending “helicopter money” bill finished. Well hell, if you can’t work together to SPEND TWO TRILLION dollars (putting the taxpayer into debt forever) then you have a major problem. Why we don’t get rid of the whole bunch we don’t understand. And that bitch Pelossi really tops the list.

__________

A new poll from Gallup shows that President Donald Trump’s approval rating for his handling of the coronavirus is now at 60 percent.

The president’s overall approval rating is also at 49 percent, tied for the best of his presidency.

The poll was taken between March 13-22.

Leave a comment

LONG TERM: PROBABLY DOWN

“bear markets don’t bottom with optimism, they end with despair.”

“With all of our signals now triggered from fairly high levels, it suggests the current selloff is not over as of yet. In other words, we will see a rally, followed by a secondary failure to lower lows, before the ultimate bottom is put in.” 

(above from realinvestmentadice.com LINK)

March 23, 2020. We are hearing horror stories about investors who have been invested with the ‘buy and hold’ financial advisors. They have lost a huge chunk of their portfolios, some up to 60%. In chat rooms, people are freaking out about their declines, and yet they continue following the advice to buy because they believe in the advisor. Fortunately we started selling very early, and thankfully we are not seeing the huge 30% to 60% declines.

We were hoping that Trump would ‘approve’ use of the “cure” hydroxychloroquine (see link below) but he is being stone-walled.

SO, after extensive reading over the weekend, WE BELIEVE THERE IS A GOOD CHANCE MARKETS ARE GOING LOWER. (unless something dramatic happens soon) The unemployment claims on Thursday will probably drive markets lower. IF you still own individual stocks we suggest you sell.

We also believed the oil situation would be resolved, but that does NOT appear to be in the cards.

Here are two links to some very good articles which explain the current environment on BDCs, REITs, et al.

LINK

LINK

LINK Hospitals have been rushing to stockpile a decades-old antimalarial drug touted by President Donald Trump and others as a treatment for the new coronavirus.
Hydroxychloroquine is being snapped up by medical systems at more than twice the typical pace as US hospitals seek to build large inventories in anticipation of the medication’s potential use in patients with Covid-19, the respiratory illness caused by the coronavirus.

Leave a comment

BORED YET? CURE COMING?

March 20, 2020. Here in Illinois, the obese Governor has ordered residents into ‘lockdown’ ensuring failure of the economy in the state. You cannot leave the house. What fun.

Despite having time to evaluate the portfolio and action in the markets, we have made no changes in the last two days.

The tension between Trump and his physician advisors was so obvious today in his daily press conference. The Donald wants to make chloroquine (the “cure” for the virus-see below) available, but he is getting strong push-back. And he was starting to get quite angry on camera.

It is beyond our comprehension why they are resistant to using a drug that is relatively safe.

IF we start seeing usage of the drug, and it proves effective, the financial markets would sky rocket, so stay alert for buying opportunities. Which is the primary reason we are sitting tight. Trump will win this argument. (There was a physician on FOX today who said they have been prescribing and it is working.)

As efforts to discover new COVID-19 medicines roll on, President Donald Trump and others this week focused attention on the decades-old malaria drug chloroquine. Bayer got things rolling with an initial donation of the drug, and now Novartis, Mylan and Teva are taking steps to deliver tens of millions of tablets.

Chloroquine and hydroxychloroquine, a more tolerable formulation, are not approved to treat COVID-19. Still, U.S. authorities and others are exploring their potential following encouraging preliminary results.

In response, Novartis has pledged a global donation of up to 130 million hydroxychloroquine tablets, pending regulatory approvals for COVID-19. Mylan is ramping up production at its West Virginia Facility with enough supplies to make 50 million tablets. Teva is donating 16 million tablets to hospitals around the U.S. 

Some comments we have read:

Despite the cascade of negative headlines as increased coronavirus testing capacity reveals the extent of the outbreak in the U.S., some analysts are arguing that the equity market may have already begun a bottoming process, and that equity prices are nearing their most attractive levels.

NOW IN OUR 8TH YEAR. NOTE TO NEW READERS: Before you buy anything we discuss here, GO to the Core Portfolio tab to see a CURRENT listing of holdings. Don’t forget to hit the like button. Our host WordPress is running ads in the blog and we receive NO compensation from this advertising.

Leave a comment

CURE?

March 19, 2020. The Core Portfolio is down 19% from the top earlier this year which is ok considering what investors have gone thru. Cash increased significantly yesterday as we were selling positions. In the afternoon things got worse and we were seeing terrible low bids and we stopped selling. The bond market froze up and we were not able to sell corporate bonds.

The Trump press conference this morning is very, very positive. They are finally addressing possible CURES in a detailed manner. As Trump said, “this could be a game changer”.

(The assholes from the liberal press are trying to make Trump look bad with their biased question, but he is succinctly answering every concern.)

For the FIRST time, we are relatively positive on this virus situation. The markets are now flat, after being up today, and the Portfolio is up 8% today. We are doing nothing other than trying to identify positions to BUY should the stock markets start to recover. We are NOT selling anything, at least for today.

__________

A drug developed over half a century ago to treat malaria is showing signs that it may also help cure COVID-19 — especially when combined with an antibiotic, a promising new study reveals.

Hydroxychloroquine, sold under the brand name Plaquenil — and also used to treat arthritis, malaria and other ailments — was determined to be effective in killing the deadly bug in laboratory experiments, Forbes reported, citing findings published March 9 in the Clinical Infectious Diseases journal.

“(W)e predict that the drug has a good potential to combat the disease,” the study’s authors, most from the Chinese Academy of Sciences in Wuhan, wrote in a letter published in Cell Discovery Wednesday, according to the report.

Now, French physician-researchers have completed a largely successful clinical trial using the drug — approved for use in the US in 1955 —  to treat confirmed COVID-19 patients, according to a study published Wednesday.

A total of 36 patients — including 20 treated individuals and 16 infected controls — were enrolled in the study, led by Didier Raoult, an infectious disease expert from l’Institut Hospitalo-Universitaire in Marseille.

%d bloggers like this: