AND THE WINNER IS …?

                             “Vanna, Show Chip What He Won”

What if they had an election and it didn’t matter? Kind of like an NFL Super Bowl overtime coin flip that lands on the ground on “edge”; and you flip it again and still it lands on “edge”. The Greeks couldn’t collectively decide this past weekend who they wanted in charge to sell the country down the proverbial rat hole to the banksters.

Well, nobody asked me … but ….

They could let the Neo-Nazi “Golden Dawn” party run security and law enforcement; the radical leftist party “Syriza” could be in charge of education [just like in Amerika] and welfare; the communists could just hang around and cause trouble and offer nothing; and the “New Democrats” conservative party can run the country and be in charge of finance. What’s not to like here?

Like Butch Cassidy once said, “I got vision and the rest of the world’s wearin’ bifocals.”

Then there’s gold; as nasty a market as the political rhetoric coming out of Europe. After what happened to me on Friday …I can’t tell you when the next time I will trade this. To recap, for those of you who don’t know, I was up 5% and then I was down 12% within seconds. Did I mention I hate gold dealers?

Watching Greece is like watching a soap opera on TV; no matter how long you watch nothing ever gets solved. It just keeps going on with infinite iterations of adulterous affairs, back stabbing, and people selling out for the money. Geeeeesh, what else is new? Sooner or later you just have to walk away because you can’t take it anymore. It’s just the same old crap.

So, no new coalition is going to be formed to run Greece and “new” elections in 2 months to do it all over again. Meanwhile in Spain, yields on 10 YR. toilet paper are over 7% and rising; in Italy, yields on 10 YR paper is over 6% and rising; and in Ireland they want to “renegotiate” their bailout.

As it says in the Bible; “Nothing new under the sun.”

The markets now are in no mood for “happy talk” from the bozo’s running things; they want concrete plans, not spin. Expect the half-life from spin to get shorter as time passes this week.

Oh, and let’s not forget Wednesday “the Bernank” is up on tap, and he better show the markets some love with QE3 or else. Markets are looking for at least $150 billion in new money printing stimulus for the prop trading desks at JPM and Vampire Squid.

Have a good day everyone.

-vegas

IT’S QE OR ELSE

                              The Bernank: Man Of The Moment

Next week, the world literally turns its lonely eyes to the Mariner Eccles building for more “Hope & Change”.

“Ohhhhhhhh, Chalky Soetero is giving his umpteenth campaign speech?”

“Errrrrr, not quite.”

The world is hoping, praying really, that Weimar Ben opens the money printing monetary easing floodgates at the June Fed meeting. As with all things, the devil is in the details, and even if he comes through, the key will be if it was enough. Hide the kids if he does nothing.

The monkey wrench in the equation is Greece; with a newly elected socialist government only a couple of days old, and ready to tell the banksters in Brussels to go pound sand, how much of the taxpayers money does Ben give away?

Not to worry, Vampire Squid [GS] will let the moneycrats know what to deliver early next week before the meeting. The real question is which Belgian or French caterer is doing lunch. Remember, “The private sector is doing fine.”

Gold especially is subject to the “buy the rumor sell the fact” mantra of Trading 101. How many times have I warned [and been right by the way] that the rock gets rolled up the proverbial hill, only to be rolled back down when the Central Planners sense the public is now just a tad long the yellow stuff?

And on cue today, the EURUSD put on a blistering short covering rally because of course too many people are short the pair. Forget the disappointing retail sales figures; it’s all about QE and the “Hope” the Fed bails out Europe and saves the day; the “Change” of course is that something but failure will be the result. Now that’s what I call “Hope & Change” trader style.

Too bad it won’t change anything because Italy is next; say goodnight Europe, the party is over in 3 …. 2 ….. 1

Have a good day everyone.

-vegas

EVERYTHING IS FIXED NOW, RIGHT?

                                         Europe In A Nutshell

For you grown-ups out there, this is like watching your kids get a free credit card from their grandparents; not a pretty sight. But not to worry, because everything is now fine in Spain because the smartest-guys-in-the-room have just thrown a check their way to the tune of a “1” with “11” zeroes behind it. Where this money comes from nobody has a clue.

But we are all smart enough to know by now that politicians solve a problem, not by actually solving anything, but by talking about it. Because you see, talking about it to them means it’s on their radar now, and not to worry, we are on it. Uh huh.

The Germans, natch, are expected to lend their AAA credit rating to this hair-brained scheme, but in all things like making sausage and passing out 100 billion Euros, the details are gonna get a bit sloppy. For one, nobody in Germany, except the Pols, are for this. Second, it ain’t gonna matter because on June 17^th, the Greeks say adios to the Euro. And third, as if we need another reason, every other deadbeat sovereign member of the PIIGS gang now wants the same deal as Spain.

“Hey, where’s our hundred billion with no strings attached?”

I swear, it’s enough to make you think the Pols are really in the biz of herding cats. A tough gig no?

                                         Politicians Take Note

Of course, with record spec short positions via the Crimex CME in EURUSD, it’s not really a surprise that we gapped up 100 big ones on the opening in Asia last night. Did you hear the big – WHEEEEW !! – whoosh out of Europe last night? But sadly, with all Ponzi schemes the half-life on this “solution” hasn’t even lasted 12 hours.

And gold? Firmly in control of the Central Planners and weakening as I write.

“But QE3 and QE4; c’mon man, money printing, ya know?”       

Yea, I will make sure and tell that to the prop desk over at JPM that is selling with both hands.”

And so, we find ourselves on countdown to next Tuesday, when we know for sure the Greeks are deadbeats, and the newly emboldened leftists tell Europe to go pound sand with their debt.

 Anybody want to make book on this?

Have a good day everyone.

-vegas

THE TRAIN WRECK IS COMING

                                           World Economies

Hold your nose every weekend from here on out. You can absolutely count on the world’s top clowns to conference and decide something incredibly stupid to stink the joint up; the only thing we don’t know is which weekend it will occur.

That Greece and Spain are toast should be no surprise to anybody with a brain. At some point though, math brings everybody back to reality. We are at that point in time and history. Markets are not going to allow the Pols to kick the proverbial can down the road anymore with shady accounting gimmicks.

Of course, when the true SHTF comes, it won’t be during market hours; it will be over a weekend. Big money hedge funds [that are tied in politically], TBTF [to big to fail] banks, and politicians need the time to prepare the inevitable for the masses. When Spain goes bust, it will happen over a weekend; when Greece leaves the Euro, it will happen over a weekend. The carnage will simply be a blimp on the computer screens across the world come Monday morning.

Everything is fine, until it isn’t.

The real train wreck for the world, when it comes, will be here in Amerika; if Fearless Leader gets re-elected it will definitely happen in 2013 or 2014. If Romney gets elected, we may have some time as markets will cut him some slack; but if he turns out to be Bush III, the end comes in 2014 or 2015.

The math doesn’t lie; China is positioning itself to be the world’s next superpower; they own trillions in $$ treasury debt; they will call the shots; they are accumulating oil and precious metals in unbelievable amounts. Remember the Golden Rule?

Them that has the gold makes the rules.

At a time of their choosing, they will walk away from supporting U.S. debt. Who buys it then?

Everybody that sits watching TV, from the relative comfort and safety of your living room, better reconcile the very high probability that life as you know it is going to end and get very, very ugly.

You think riots and anarchy can only happen in Greece? With almost 50 million people on food stamp debit cards [oh, excuse me, nutritional assistance], what happens when those cards don’t get loaded some month? You think millions are gonna sit back and just relax while they starve?

“Snake Pliskin where are you?”

Sure, the straight forward problem is math; the real problem is that there are no leaders willing to bite the bullet and lead.

I don’t know if Mitt Romney can prevent the U.S. from the abyss; I am quite sure Chalky Soetero is planning on it.

Meanwhile ……. It’s the weekend and time for a chuckle. Without further ado …..

Have a good weekend everyone.

-vegas

WHY BUSINESS, GOVERNMENTS, & TRADERS GO BROKE

                                      Master Of The Obvious

First, a little housekeeping if you will; you will notice that I have changed my Twitter account. You can now follow me at @vegastrades and I will be commenting as “vegas trader”. So, why the switch?

For some unknown reason, my other account was suspended; no reason given and numerous emails into Twitter’s phantom support have produced, after 24 hours, absolutely nothing in terms of a response. I had sent out 5 tweets, and when I sent out a re-tweet from someone else, I got my account suspended.

So, the idiots at Twitter leave me no choice; I created a new account rather than wait around for the clueless staff to someday get around to my problem and then fix it.

This whole ordeal got me to thinking why businesses, governments, and yes even traders fail at what they do; they ignore reality and instead focus on fantasy.

If a business model is sound, a business will often still fail because they eventually cut corners, and one of the first is customer service. Back many years ago, I had an uncle who owned and operated a family steak house in the town I grew up. He was paranoid about customer satisfaction; he visited EVERY single table and talked with EVERY single customer to make sure their meal was to their delight. It didn’t matter if he knew them for 20 years and they came 3 times a week; he still took the time. If he even for a second thought something was wrong, or you weren’t satisfied, you got free drinks or even a free meal for the whole table.

Sure, some people exploited this, and he knew it, but he knew what other people in the restaurant biz intuitively fear; people say the meal was “fine” and then leave and tell everybody they know what a dump the place was and the food was terrible. He could lose customers and not even know it or be able to control or respond to what others say. His paranoia was the secret to his success.

Governments promote fantasy almost every single day, yet the reality can be summarized effectively with one word: Greece. What a bottomless pit of mind numbing kleptocrats stamping forms and playing pretend. I have visions of the staff and crew of the Titanic arranging the deck chairs and putting out fresh towels in first class as the ship keels over and sinks.

Traders fall prey to this lack of customer service as well. How many of you view your own account as that of a business? How many give your account the attention it deserves through proper risk management? Or instead, do you make “stupid trades” [definition = large losses] in the fantasy of “it will come back”.

“Yea, sure it will; just like your old girlfriend from high school. Just a sec please.”

The common thread that destroys each is that there is no fire in the belly to do the right thing. None. Doing the right thing is tough; it requires discipline and a desire for an outcome that is greater than just the desire for profit. People who are successful put other people first and instinctively know that by focusing on there needs, they will profit.

Just the other day, a high school girl running track in the State championship in Ohio was running the 3200 meters, when nearing the finish line another girl collapsed in front of her. At that time she was in 15^th place and the girl that collapsed was in 14^th place. She stopped and helped the other girl up and assisted her to the finish line making sure the other girl finished ahead of her. She has become a You Tube viral sensation. Here is the link for the whole story:

http://espn.go.com/high-school/track-and-xc/story/_/id/8010251/high-school-runner-carries-fallen-opponent-finish-line

If this girl ran a business, and I needed any product she was selling, I would definitely give her a shot at my business, even if her products were slightly higher in price. Why? Because I know what kind of person she is and what she stands for; I value that.

As for Twitter, Greece, and the consistently large losers who trade; you got a lot to learn.

Have a good day everyone.

-vegas

BRITS PARTY EUROPE DROWNS

                                  Her Majesty Queen Elizabeth

Really, who can blame the Brits for wanting to party for four days to celebrate one of the world’s best loved Monarchs? I mean, after having to read and listen to all the hooey news out of Europe these days, partying might be the only way to stay sane.

Who cares if your currency is down 1000 pips in the last month? After all, it just means all those people who had to buy Pounds to play now get ‘em cheaper and can spend more. What’s not to like here?

But lest we forget, let’s go back in the vegas hot tub time machine and remember back this time 20 years ago when the cry from the political elite was for the Brits to join the EU and give up the Pound for the Euro. If I remember correctly, it was John Major who told the EU to go pound [pun intended] sand. And of course, the bloatacrats in Europe were aghast.

Well, who’s partying now and who is drowning in debt?

Meanwhile …… in marketville, plan on nothing happening in London for the foreseeable next few days as people first party, and then need the upcoming weekend to recover. If it’s gonna happen, it will be in the Asian or U.S. trading sessions.

Meanwhile ….. in the hallowed halls of Europe, the Central Planners are still trying their collective alchemy skills to make 2+2 = 22 and find a way to make trillions in cow chips [otherwise known as European Sovereign Debt] look and smell good to the public.

“Can we just get one trial balloon you guys in the market might like?”

“Errrrr, no.”

And then we have Greece; now that we are 2 weeks within elections, no more opinion polls. So, it’s back to normal for the 40 year old philosophy students at university who can’t bear the thought of life without somebody else paying for it. It’s your basic SNAFU all the way here.

Have a good day everybody.

-vegas

OCTOBER 1992

                                                All Aboard

We are fast approaching a moment in Forex trading that can only be described with history.

As we enter my hot tub time machine, I’m setting the dial for October 1992. Let’s review the facts shall we? The British Pound [GBPUSD] is north of 2.00; George Soros is long D-Marks and short the Pound in such large quantities that the Bank of England makes a request to him to stop shorting their currency.

When the Brits decide they don’t want to be a part of the EU, the Pound plunges; 3 days later it’s trading at 1.40. Up until now, this is the moment in history that can best be described as a “nuclear moment” for major currency pairs; a 60 handle drop worth $60,000 on a 1 lot.

Of course, we now know that George had inside information from the Chancellor of the Exchequer that Britain had absolutely no intention of joining the EU currency, but in Forex trading the only rule is there are no rules. A cool $6 billion in profits; but I digress…

We all know politicians lie; yesterday I read over at Zero Hedge how the police in Greece are urging people to leave their money in Greek banks and not to participate in a classic run on said banks. After all, it’s a safety issue don’t-cha-know? [Excuse me I have to puke … OK, better now.]

Everybody should know what this means; collapse is imminent. Sometime, over the next 10 weekends, Greece will get kicked out leave the EURUSD; it will happen over a weekend. You wake up Monday morning and there is a new reality from Sunday night. So, which weekend and what exit scenario?

Our pals over at MS are telling muppets clients that it could get as ugly as 0.80 on the Euro under 1 of 4 scenarios they envision for the Greek exit [Grexit]. That, my dear readers, would be an approximate 45 handle haircut, and eclipse that long forgotten Pound episode from ’92 [forgotten except by those who lived it]. Fortunes made, fortunes lost.

So where does this leave gold?

I have a very hard time, after seeing the Euro slaughtered along with equity markets, seeing gold rally into this. I don’t know how the smartest-guys-in-the-room stop a deflationary collapse like this. Sure, the policy response will be to print untold trillions, thus setting the stage for the eventual hyper-inflation collapse, but the initial knee-jerk reaction is likely to be many dollars / oz. to the downside.

And every Sunday afternoon, when Forex reopens in New Zealand from the weekend, do we get any relief rally when we come to find out this wasn’t the weekend for Grexit? How many weekends do you go home short, only to find out you got sandbagged again, and get to buy it higher on the open? Nothing is a slam dunk here.

But what if everybody is wrong here on the catastrophe? If they happen to get it right, and kick Greece out the right way, wouldn’t that be uber-bullish for the Euro? How about a 10 handle higher open with the Gypsy’s out of the way? What would a $100 / oz higher open in gold do to your juices? Let me repeat: nothing is a slam dunk here; nothing.

But whatever weekend it occurs, and the inevitable rioting and chaos that follow, and you’re sitting comfortably in your easy chair, just remember this: you are looking at the future of Amerika.

“Thank you politicians.”

Meanwhile …. It’s the weekend and we need a chuckle. Without further ado …

 Have a good weekend everyone.

-vegas

QE WHERE ARE YOU?

                                      Gold Trading Directions

Just a friendly reminder from our pals at JPM that the rock needs to be rolled up the hill one more time; in a research note today they are now predicting more QE from the ECB at the June and July monetary meetings with a cut in rates in September.

So, after a $40 rally off the lows, muppets clients now have an official reason to buy gold at today’s highs near 1577. Maybe some day the public wakes up, but I doubt it; after all, these are the smartest guys in the room remember? That the market will undoubtedly back off from here on “profit taking” [thank you CNBC money honeys] isn’t anything to worry about. Neither is the probable fact your investment adviser sold the market aggressively in the 1575-ish area while you were buying.

“Hey man, it’s just a coincidence.”

So, we now have QE baked into the gold cake not only from the Fed, but now from the ECB as well. Super; when they don’t deliver what then? Who is left to buy? Even if they deliver, if we are still in this price area of 1550 – 1600, who is going to take the lead and take on the Central Planners above 1630?

One thing I am fairly certain of is the desire, on the part of Chalky Soetero and his pals, to keep gold out of the news as election season heats up by the day and week. No way do they want the sheeple people of Amerika to wonder why gold is rising? They might get ideas.

On  the currency front, if it’s daylight in Europe, some politician is lying and desperately trying to convince someone, anyone, that Plan G will work [even though the trial balloons of Plan A-F were dismal in approach and can’t work]. We will get fireworks on the upside as over leveraged shorts will bail in a panic [like today for instance] but the big money knows Europe and the EURUSD are toast.

It isn’t a question of if, it’s only a matter of when; what weekend do they announce Greece is gone out of the Euro? Come every Sunday afternoon from here on out, every money manager on the planet will be glued to the screen to see what’s happening at the open in New Zealand.

And lest you think it’s only Greece, the fellas in Spain and Italy will be watching very closely to evaluate their exit options as well. Forget the politicos; if there lips are moving they are lying.

Have a good day everyone.

-vegas

WHEN GOOD NEWS IS TERRIBLE

                                         Take Notice Markets

All it took was a fantasy land slightly better housing number and you could here the QE3 air come out of the market balloon. Perceptions are everything; that and the fact Europe becomes more desperate and broken every day.

Catching a falling knife is always difficult and most retail specs can expect very bloody fingers for their efforts; the action below 1545 in gold was just brutal in terms of price change. So, here we are at the 1530 -1540 area as I write; remember 1599 Mrs. Watanabe? You know, rock up the hill, buy the dip sell the rip? I’m wondering where the remaining longs have their collective stops: 1520, 1500 maybe?

Any day the market is open seems like a good day to sell EURUSD. The root of the problem in Europe is that every politician over there has squandered their collective credibility over the last year and a half by bold-faced lying about the problem.

In a nutshell: when you loan money to deadbeats, don’t expect it back – EVER!

“I give you extra 1% - how that sound German swine?”

“Sure, here’s another €5 billion Euro’s.”

Every day they send out somebody to boldly lie where no man has gone before. How many times have one of them said everything is OK? If I had a nickel each time over the last 18 months, I could give the money to Greece and the problem would be solved!

Really, the whole point in having the Euro slime talk is to buy time and start short covering rallies that the big money can sell. With record shorts in the EURUSD [about 22 billion notational] all it takes is a small spark anywhere near the close and we start rallying like a dry Christmas tree on fire.

It will be interesting to see if gold can hold 1500. If it can’t I think it’s going to be an ugly, ugly affair going forward. I’m just going to throw this idea out there for you perma-bulls in gold to ponder. What if the gold market is factoring in a Romney win over Chalky Soetero and both houses of Congress are Republican? What if they slash taxes, let loose the energy industry, and balance the budget? Up until now, gold has been up 11 straight years; if that scenario plays out gold ain’t gonna be anywhere near 1500.

Have a good day everyone.

-vegas

ROLL ROCK UP HILL REDUX

                                       Attention Gold Buyers

I’ve had this nightmare dream before; I’m driving along and everything’s fine and then out-of-the-blue the rocks come falling down crushing my car and me inside. You wake up and realize it ain’t happenin’, but nonetheless for a few seconds it’s a little disturbing.

How many times have we seen this scenario: sharp rally, crush shorts, turn common tech indicators bullish, get public long [again] at or near the top within 100 hours?

As the world falls apart and specifically Europe implodes, the smartest people in the room have just bet, in the last 48 hours, that Weimar Ben will hit the Cntrl-P button over at the Mariner Eccles building and start QE3 in June. If we don’t get it, a whole lot of people are gonna be trapped inside my dream.

I’m going to go out on the proverbial prediction limb here.

I think we have seen the low in gold up and until the Fed meeting in June. I can see about 1550-1557 on the low side and maybe 1610-1625 on the upside until then. But here’s the rub; if we don’t get QE3 from the Fed in June, and 1530 -1525 subsequently gets taken out, we are headed for a major debacle in price on the downside. And with that comes many months of price congestion and basing before gold can ever hope to go higher.

Around the 1580 level and higher today I have seen the “nibble nibble BOOM!!” phenomena from the Central Planners. There’s no doubt in my mind they were heavy handed in the market today. What do you suppose that means?

While the entire world goes ga-ga over the FaceBook IPO today [expecially California State Tax Apparatchiks], Greece is toast, Spain implodes, and European GDP is falling rapidly. Granted we needed some kind of rally because so many people have piled into the short side of gold.

[Here’s a thought; what if FaceBook opens higher and closes lower? What happens then?]

But remember this: in a bear market [not just gold but any market] the rallies are killer – they come out of nowhere and they are vicious – and they convince a whole lot of traders that the trend has just changed and now we can pile into the long side of the trade. If you look at a daily chart of gold this is the type of action we have seen since 1800.

Ultimately, after the stupid money has piled into the wrong side, price rolls over and we get the rinse & repeat cycle we have seen ad infinitum nauseum  since last Fall; buy the rally get stopped out [pick number of days here ___ ] later.

You can rationalize a lot of things, but you can’t ignore the math; Europe is complete toast and the U.S. [add Japan too] is next. Stocks are so overvalued, pumped up via the Fed to get Chalky Soetero reelected, and give the illusion that things are just fine.

We have started to see stocks roll over world-wide; practically every major stock index is lower on the year. When the complete “risk off” comes, just remember gold isn’t immune.

Meanwhile … Chuckle of the day before the weekend.

Have a good weekend everyone.

-vegas

Update 3:15PM Chicago Time

In case you were wondering why I have Friday rules, I present EURUSD as prima facie evidence of what the Central Planners can do when conditions are thin and stops are on the plate. At 2:00 P.M. we had a melt up stop hunt in the EURUSD of about 60 pips within a few minutes on zero news.

Whatever can make your weekend can destroy your weekend. I wonder how many Euro traders are crying in beer as I write; only it won’t just last a few minutes, it will be there all weekend into the open on Sunday night. Been there done that once in 1980; ain’t ever happened since.

Sometimes it may seem to those who are new to trading and creating wealth that my methods can be restrictive and that I may miss some profit opportunities for no apparent reason. Lesson #1; first do no harm, then make money. I rest my case.

The Dow 30 closed near the lows of the day as FaceBook closed at $38. Another pump and dump scam Ma & Pa Kettle will eventually lose money.

Over the weekend [probably Sunday] I’ll have a special post. Tune in for details.

@EUROPEFAIL

                         What He Sees & Hears Would Shock You

Back in the day before electronic trading, when trading pits were all the rage and people jammed the exchange gallery all day long to watch us act like chimps in heat, the things that really mattered were often ignored and unseen by most traders. It’s what we don’t know that is our biggest problem.

Greece is in the Euro; Greece is leaving the Euro. Greece has money; Greece has no money. Europe is doomed; Europe will survive and later prosper. Banks are bankrupt and doomed to close; we need banks to facilitate commerce. Guess what? It doesn’t matter.

“Only the fly knows what’s really going on, and he ain’t sayin’.”

Buying/selling based on news flow will put you in the padded room quicker than being a chaperone in a room full of teenage girls. The same news that takes [pick your market] up, two weeks later takes it down. You tune in to your favorite “Money Honey” on CNBC or Bloomberg to get the low down on what’s going on and all you get are shills talking their position.

There are bull markets and then there are bear markets. Right now, gold is in a bear market. Sorry if that offends you if you are a “gold bug”, but it simply is the truth. Maybe tomorrow it starts the next leg up, or maybe it takes another 5 years to get back over 1800. I dunno and neither does anybody else.

The best simple advice, as a trader, I can give somebody who wants to trade can be summed up in what I read yesterday on Zero Hedge [in mother approved language of course]: “If you are going to buy the dip, you better be willing to sell the rip.”

Masters of the Universe, hedge fund traders and managers, and large spec retail accounts often mistake their opinions as market facts; next thing you know they are OOB [out of business]. Price means nothing; volatility means everything.

All that matters is the flow of money into and out of a market. You have to be early to every move to get the prices you want getting in, and you have to be willing to leave money on the table on the way out; volatility will hopefully take care of the rest. Reaching for that last dime will kill you.

In bull markets, it is the sudden drops that keep you from getting long; in bear markets it’s the explosive rallies that hurt your short positions by forcing you out. I can give you 5 reasons gold has to go higher; once you absorb this I can give you 5 reasons gold has to go lower. What do you do now?

Understanding money flows makes trading simple; I said simple, not easy.

Have a good day everyone.

-vegas

BUYERS ON STRIKE

                           That’s Right; We Ain’t Buyin’ Nuttin’

I know it’s hard, but imagine this for a moment; Greece is totally out of money! They got about € 1.98 in the bank [if it’s still open]. I mean, who could have seen this coming?

Tomorrow sees a Greek bond auction, and if this somehow gets undersubscribed and they can’t raise the necessary scratch to pay the bills, I’m sure all the public sector union thugs employees not getting paid, the 40 year old philosophy students not getting their University tuition, and the pensioners who see their monthly checks slashed,  won’t be a problem. Peace and love in Syntagma Square.

So, the only thing left to do in Europe is sell gold. Even the “Lemmings in Asia” have caught on to the scam game. Yes, Mrs. Watanabe and all her pals, who have been accumulating gold from the 1800’s, 1700’s, and 1600’s, are now bailing in the mid 1500’s. As predictable as they were going up, they don’t disappoint on the way down either; only, on the way down it happens a lot faster.

Not to be outdone, that stellar Wall Street firm Morgan Stanley is telling muppets clients today that gold is still a buy and that the future looks bright for the “barbarous relic”. Seems their prop desk has more proprietary selling to do.

We’re due here, in just about everything financial and especially gold, for a smart 2 or 3 day rally that takes prices back up some. Whenever it finally does happen, look for the rally to start sometime after the Crimex Comex closes for the day. After all, the dealers and Central Planners have to shove the rock back up the hill, in the least volatile time of the trading day, to get everybody else to buy it in “prime time”. Rinse and repeat.

Meanwhile, at JPM …….

                                             Ina Drew Is Gone

Somebody had to fall on the”It’s-my-fault-the-firm-lost-2-large-on-the-trade” sword; making a paltry $15 million per year I’m thinkin’ soup kitchen isn’t in her future. Perhaps there is a good job in Chalky Soetero’s administration somewhere; Treasury Department would be appropriate.

Have a good day everyone.

-vegas

HEY EUROPE SHUT UP

                                              Trader Manual

It seems like every day Europe sells everything in sight, then when they close at about 9:30 A.M. [Chicago time], as if somebody shuts the lights off, markets turn on a dime and rally like crazy into the close. Rinse and repeat almost every day.

It’s frustrating dealing with these European bozos on a constant basis. They skew gold, the currency pairs, and equity and bond markets; close them down and markets trade on a more normal basis. Why should today be any different?

I thought the “Lemmings in Asia” were a pain; they’re nothing compared to the unbridled selling of everything with a $ sign on it just so they can keep their bankrupt banks alive for another day.

If I could round up every politician, I’d line them all up against the wall and ………

Today we find out from the politicos that Greece has no money and maybe they shouldn’t get any more; gee, ya think? And Spain nationalized some banks; yea, that will solve the problems. Of course, this hammered gold and the currency pairs, and within minutes we were sharply higher. Seems somebody had to get the final sell stops below the market.

Go ahead, call me cynical, but the outright blatant manipulation going on is shocking to me. Sure, I have seen a lot of things in my trading career going back into the late 70’s, but I haven’t seen anything like this. It’s breathtaking and disturbing at the same time.

Have a good day everyone.

-vegas

OVER THE CLIFF

                                            Europe Today

It’s gonna be an interesting next 6 months or so; wait a minute, what am I thinkin’? We don’t have to wait that long; come May 15 the Greeks have to come up with a cool half a billion Euros to pay the idiots  investors who hold Greek bonds that didn’t go along with the bailout.

Add to that a new Greek Government that is made up of Neo-Nazis and God knows what else, and oh don’t forget France now has a socialist President, and you have the makings of the wheels coming off the goods.

Let’s not forget, however, it’s going to be all euphoria from the politicians down to zero. After all, when you go off a cliff, nothing really happens to you until you hit the ground; that’s when it hurts.

The implications of this weekend in Europe are enormous. Expect louder cries of nationalism, confiscation of wealth through higher taxes, more bailouts and giveaways to the masses, and ultimately markets to work lower; maybe much lower.

I wouldn’t be long European stocks or bonds if they gave them to me for free. Now, maybe that means the bottom is close at hand, but looking at the political landscape of Europe, all I see is 1930.

Gold’s initial reaction is one of indifference; opening lower and maintaining a tight range throughout the trading day. The problem I have with gold at the moment is threefold; 1) the daily chart pattern looks horrible, 2) it is the asset of choice to sell when people need to raise money, and 3) the Central Planners are the ever present 800 lb. gorilla in the room.

The sad fact is that the money printing will continue unabated in Europe, Japan, and of course the U.S. Markets will eventually sort these developments out, but it is going to be a very bumpy ride. Which country gets to zero first?

Not much has happened in the markets today; but not much happens in the eye of a hurricane either. Just wait.

Have a good day everyone.

-vegas

FEARLESS PREDICTIONS FOR 2012

                                            OK, Let’s Play

Instead of making predictions, I’m going to take a slightly different approach and tell you what happens if certain events take place in 2012. It’s more fun, and will allow me to say “I told you so” some time down the road.

The Main Event of The Year: Election 2012

                                           Kim Jong Un II

If B. Hussein Soetero gets reelected as US Prez, you will look back from the future and remember I told you it was the end of The Untied States as you knew it.

There is no way the United States can take 4 more years of this socialist asshat. If the people of Amerika are stupid enough to fall for “Hope & Change” the first time, then they are just dumb enough to do it again. And if that happens, just look to Greece to see the future Amerika.

The “Land of the Free and Home of the Brave” has been replaced with “The Land of the Indebted and Home of the Victims”. Amerika has become a fascist, socialist paradise; just be a victim of anybody that has made $1 more than you and apply for government benefits.

If he gets reelected, 2 things will happen.

First, the debt of Amerika will absolutely explode. Look for multiple trillions in debt, financed by forced participation of your 401K or IRA, and much higher tax rates. No dollar in Amerika will be safe from the clutches of “The One”.

Second, look for capital controls and the end of your personal freedom to invest your money the way you see fit. The goberment knows best don’t-cha-know. Welcome to the new reality. Look for people to go “John Galt” in increasing numbers.

                             Don’t Go Away Mad, Just Go Away

2^nd Main Event of the Year: End of the Euro

Sometime in 2012 the Euro will collapse, and with it the socialist dream of the apparatchiks in Brussels. There simply is no way this farce can continue.

The main thing I’m looking for is the reintroduction of the D-Mark for trading. The spread opportunities alone are making me giddy.

The political ramifications are enormous. What I’m hoping will happen is the introduction of capitalism into these various countries. I’m not holding my breath however.

Whatever happens, though, will not change the average Amerikan fascination with the dumbest stuff imaginable. If it has no value and repulses you, odds are it will be headline news for about a week.

Today’s Action & Wrap Up

We came into today in neutral mode and await a signal. From the looks of things, and the fact that there are only a few more hours in our trade initiation window, it doesn’t look like there will be any trades for the day. We missed a good down move today, but remember, it’s an opportunity cost not a real loss. Know and understand the difference.

The fact that gold is imploding into year end I find interesting. Sell gold [one of the few winner trades over the last year] to cover losses you have incurred everywhere else [i.e., equities] for probable tax reasons.

In the U.S. you can only deduct losses from something of like kind that is a winner. If you don’t sell the winners, you don’t get to carry over the losses into the New Year. Some system heh?

So, no trading today; $ 0.00 gain for the day.

Have a wonderful day everybody.

-vegas

What a Week To Start

                         MF Global, Inc. Compliance Department

After a somewhat extended hiatus, I'm glad to report I'm back [better than ever of course]. The title kind of says it all this week: The largest futures broker in the world, MF Global, Inc., declares bankruptcy, the Euro is about to get "Greeked", and the Fed basically has told the world it has no clue what to do. Other than that, not much going on.

Gold was all over the place today; starting at the lows and rallying to put the high in around 1744 and then on the Fed "minutes" dropping rather quickly to 1719 before retracing almost all of the drop. My BFSG algo picked up most of the first rally out of Asia, so no need to get involved when Weimar Ben took over around 1 PM.

Trading near support/resistance levels continues to be dangerous, as hedge funds and dealers are running the stops on a constant basis; gaps of over $2 can be seen in a second. I continue to preach about not putting your stops in obvious technical situations; you are just asking for a lousy fill.

Overall, gold is pretty well supported and I most definitely prefer to buy on the breaks. So, how do we do that? Best strategy is in the algorithm. Download it now at the link.

More comments tomorrow as I get into this.

     -vegas