Dear Traders,
Our short TLT trade is working. This is a bet on a weaker US Bond Market and higher US Interest Rates.
Technically the chart is in a downtrend channel.
Fundamentally, TLT short is supported because the China Investment Corp (CIC) sold a net 34 Billion in US Treasuries and took a 1.45 million share position in GLD, the gold ETF as well 2 million shares of OYL, the oil ETF.
They also took a 3.5 USD billion position in Canada’s TEC resources.
Why would any investor in his right mind lend money to a dead beat borrower and I think the Chinese are waking up to that fact.
The US is creating vast amounts of money out of thin air and what backs it up ? The promises of Bernenke and Obama ?
In my opinion production of sellable goods creats growth and jobs- this is real effort and efficient use of capital.
I read that there are over 30,000,000 government servants in the US and only 29,000,000 workers in the manufacturing industries that produce real goods for sale. This is a dramatic reversal from 1980 when there were less than 8 million government servants and 40 million manufacturing workers.
What does a government bureaucrat produce and how does he create growth and jobs?
This should support our gold/ commodity positions in the weeks ahead.
George Soros in the Davos investment conference loudly proclaimed gold is in a bubble and smart investors should sell their gold holdings.
What he did not say was that his Quantum fund doubled its gold position just like the Chinese.
This is also positive for our gold position which I think has found support at the 1070 level.
Bernenke raised the US Discount rate by .25 % Thursday and this had the effect of stampeeding the cattle as frightened sheep investors sold their shares, bought US treasury bonds and sold commodities including gold. Professionals and smart money were not fooled by the US government effort to surpress gold and gold recovered smartly.
I continue to favor our strategy of gold/ high quality KLSE consumer stocks with dividends and a cash position to take advantage of a steep drop in the market.
Salvador Dali is back and if you are free this may benefit you:
Charting our course
On 6 March 2010 (Saturday) our team will present at the Sime Darby Convention Center with the goal of supporting Salvador Dali who produces Malaysia Finance Blogspot.
The featured speaker is Salvador Dali who runs Malaysia Finance Blog, one of most heavily trafficked finance blogs in Asia. Salvador Dali is his pseudonym but if you attend you will get to meet him personally and know his real name.
You might ask why does he adopt the name of such a famous artist ?
Salvador Dali,the artist is famous for his portrayal of subconscious reality. As a stock market analyst, Malaysia Finance Blogspot also sees and reports on market realities the average Joe might miss. Dali knows the reality of the stock market and how you can profit.
Let the artistry of Salvador Dali help you gain insight into stock market mysteries
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You might ask, why hold a stock market talk in this time of extreme volatility, fear and uncertainty.
This is the point: Opportunity presents itself in this environment. Fear, panic and bad news is the friend of the buyer according to Warren Buffet.
Topics Dali will address include:
- Will the KLSE revisit the March 2009 lows ?
- What can cause volatility in 2010 and how we can take advantage of it.
- The secret of how to profit smartly from bonus, rights, and warrants
- The evolving banking landscape in Malaysia
- Call warrants, friend or foe
Martin Wong and myself will also present some price and volume trading techniques that can help you improve your timing.
Please note this is not a talk where stock tips are given out. It is a collection of investing rules, opinions and clarifications of myths of equity investing.
Venue, time and price
This event will be Saturday, 6 March Sime Darby Convention Center,Bukit Kiara. Time is 9 30 to 12 30. Price is RM 180 and you can purchase tickets via AXCESS Ticketing Hotline (credit cards) 03 7711 5000 Monday- Fridays 9 AM – 6 PM Saturdays 9am -1pm or email malaysiafinance@gmail.com
I asked Dali for a discount for our members and he said if you use you Platinum Visa card there is a 20 % rebate and if you book next week there will be a discount from the RM 180 rate.
Have a good week
Bill
