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Saturday, February 23, 2013

Jim Rogers, Facebook, Marc Faber, Walmart, Peter Kinesa

Investors' Insights:
Week Ending February 23, 2013

"Investors' Insights"

Video Summary: Nouriel Roubini, Roubini Global Economics co-founder and chairman, weighs in on the global economy, and provid...

Recent studies noted in a book review, published by The New York Times, indicate the predictions of so-called experts have a higher probability of being wrong that the statistical mean. So more half of what they saying will later prove to be win correct. That doesn't solve the problem though, as you still have to decide what prediction will be wrong and what one is going to be right. Even simply doing the opposite of what pundits are forecasting is a problem, because as the video shows, what they say is qualified and often so mixed with jargon, that you are left more puzzled than enlightened.

So enjoy the double speak, do more research and then flip a coin. Your odds are still apparently better that the experts.

First Financial Insights
February 21, 2013

Betting or Investing?

How do you spell recession Marc, doesn't it start with a "D"? 

Anyway, we have been forecasting this for a while, so sooner or later we should be right. Hmm. Our greater fear, beyond mere words, is that severe supply shortages of raw materials, energy, water and food stocks are the ingredients for a "dark age" leading to social unrest, political change and increased hostilities and protectionism.

Who knows where that will all lead?

Meanwhile. no one has really officially ended the Great Recession that began with the 2008 meltdown. Indeed, if you follow Paul Krugman, in his latest book he titles it a Depression. We have yet to hear his official fiat declaring the end of this period.

Ever get the feeling that these folks are just playing with words and not one of them really knows what the heck they are talking about. If you don't - we do!

First Financial Insights
February 20, 2013

Feeling a little depressed? 

Walmart says February month to date sales are “a total disaster.” Bad, bad, bad news. And not just for the Chinamart (sic) but for "Chiameri...

Just so everyone knows, we are doing the same thing we did with Libya. We have put Walmart on our "Stocks to Watch List" - for now.

First Financial Insights
Feruary 19, 2013


Marc Faber - China Rising Tensions

This is just short comment by Marc. But it tells China is high on his radar. Same here. Transparency aside, China has too many internal and external issues for us to call it a good long-term bet. In fact, we are taking an opposing stance to conventional wisdom and foresee a lot of trouble. The ghost cities, pollution, resource supplies, corruption, cronyism, water shortages, US treasury holdings, and civil unrest are just a few of the concerns that say: this puppy is poorly managed and doomed to implode.

Moreover, its poor product quality reputation is becoming more widespread - so its leadership in manufacturing will be lost. Add higher future oil prices into the mix, and transportation costs should shift more production away from China. In fact, back to the US, Europe and Canada. Smart companies are actually already doing this. That's foresight.

Meanwhile, as Einstein once more or less said, "do not expect the same guys who created the problems to solve them." Never happens. A regime change would be good for business, politics, ecology, society and most importantly the oppressed people of this nation.

First Financial Insights
February 19, 2013

"A change is as good as a rest"

Jimmy in this phone conversation says he is neither long nor short Facebook; he is simply just not investing. In investment parlance this means, he thinks the stock is garbage and would not touch it with a ten-foot pole. We agree.

First, Facebook ascribes to one of the worst American business practices and has little "human touch" in its business model. American businesses that fail on the world stage are often swept away by global competion because they do not have a High Touch with their customers. Any company that does not have a real person available to assist customers with service issues is doomed to fail - it happens all the time. The first rule of business success: "Listen, listen, listen, and then when you have heard enough, listen again and again and again " 

And the second rule that follows: Don't let your accountants run the business - need we say more? 

Second, its software is not intuitive, particularly for business, and again faces customer service challenges that will turn this market off in the early going. This market is where the real money is made.  They will not return once they have been turned off.

Facebook faces powerful copycat competition from the likes of Google, Twitter, Microsoft and others, who have other complimentary platforms where the combined functionalities of hardware and software configurations create synergies that could easily see Facebook's consumer markets stolen. Moreover, these powerful competitors have a strong presence and trust in the more lucrative commercial markets that are critical to long-term success and profits. We don't see a lot of businesses tying their destinies to what is perceived be to a kid's fad and consumer product. 

It is unlikely that Facebook can hold its valuations. The markets may give it a couple years, at most, to generate commensurate profits. Right now, that appears highly unlikely considering the tough competition in its most lucrative markets.

We go beyond Jimmy and expect this puppy to sink well below $10 in the next 12 to 18 months. More so, if interest rates climb in this period. So don't waste your time or your money on the long side of this hyped-up generational fad.

First Financial Insights
February 18, 2013

High Tech minus High Touch, Spells Disaster 

Friday, February 22, 2013

Jim Rogers : There Will Be Wars Over Oil And Water

Jim Rogers : There Will Be Wars Over Oil And Water

Some of you may be shocked by Jim's sort of flippant comment yesterday. You should not be. This is just the history of our species - when the scarcity of national resources can no longer be resolved through economic and political means - INVADE!

Read the "A Short History of Progress" for a quick refresher on this historical fact. A link is provided on our list of recommended books.

First Financial Insights
February 22, 2013

We are here for a good time; not a long time 

Tuesday, February 19, 2013

Dr Peter G Kinesa : Paul Krugman - Currency War Confusions

Dr Peter G Kinesa : Paul Krugman - Currency War Confusions

Take me to your leaders!

Paul Krugman - Currency War Confusion  OR Just the Same Old BS (click here) The New York Times, February 15, 2013  Why do I state over...

It goes without saying that Peter's comments are aligned with our views. But let us underscore our disbelief and utter dismay for Economists and all their related academic and institutional establishments. What planet do they think we are living on? Surely, these wise folks are smart enough to figure out that growth cannot go on and on and on. But who knows, maybe not.

Perhaps they truly believe that their abstract world governed by the thesis that a positive sum game without constraints, actually exists. That the real world's negative sum game, with all its physical and mathematical constraints, is just a bad dream. When these two worlds collide the human disaster will, however, be unprecedented ; as all order in economics, politics and civil society will just completely fall apart. And then. And only then; will they be calling on YOU know WHO, to try and put Humpty Dumpty back together again.

So let their words mean what they mean them to say, reality pays little attention to such childish semantical games -  little heed at all. And let's just face it, the Harvards, Oxfords, IMFs, World Banks, Finance Ministers, Economists and all the rest, have not advanced economic thinking in over 200 years.(Just ask them - what are the critical outlooks for economic study?) Nor has any form of quantum thought, information, discovery and research every been applied to this "field of study" in a substantive way. Still, they continue to call this a science? Ha!

So in the end, we have just one question about this group of neurotic malcontents...

First Financial Insights
February 19, 2013

...why are these guys so...

Saturday, February 16, 2013

Eric Sprott, Jim Rogers, Winston Churchill, Peter Kinesa, Marc Faber

Investors' Insights:
Week Ending Febraury 16, 2013

"Investors' Insights"

Dr Peter G Kinesa Blog, February 15, 2013
Article; The Guardian (UK), 

Indeed, there is a gathering storm let them know!

First Financial Insights
February 15, 2013

"Don't Worry Mom - What goes around; Comes Around..."

Can you believe this? Are these people nuts? There is no climate change. We are not overpopulated. The world has enough resources for eternities. No species are going extinct. Glaciers are not melting.  Fresh Water is plentiful.  The global economy is not on the brink of collapse. These are just a few of the misconceptions and lies that these right-wing kooks are promoting.

What next? Mathematics does not exist? The laws of physics are negotiable and may be legislated away? We have supernatural powers?

Funny, the Nazi’s believed in the occult too. There is no doubt that these jug-heads are revisiting Mein Kampf for inspiration, techniques and speeches to stir the vast uneducated masses. To stir their fears with lies, propaganda and rhetorical ideologue.  However, this time the holocaust will go well beyond millions – for the fate of the human race is now at stake along with the lives of billions.  There are no higher stakes.

The mainstream media is restricted in how they may coin and define these sick, twisted and intellectually perverted right-wing think (sic) - tanks. We are not. They are carbon copies of the 1930’s  Brown Shirts that bullied their way into German power. And the world has not forgotten the dangers and sickness that these cowards bring upon an unsuspecting world. Churchill taught us well. We will never forget Winnie’s tenacity, wisdom and superb foresight that saved not only a Great Island Nation- but it also saved a civilization from its untold evils.

So today again, this evil stirs in our midst. Seeks to destroy the civility of our species. To undermine its true progress by destroying the books of science and truth; to serve their sole evil perversions.  
So let them know that on every beachhead of thought, they will find those with a greater will. A greater determination.  An unyielding belief that we will prevail. We will prevail against all adversities. And let them know, that there is no doubt – no doubt at all, that we will win and defeat their lies, censorship and propaganda on every turn. On every word. On every deed.

History has revealed their sicknesses before, so let them know that we understand the hardships we face in defeating the cancer of these think-tanks and their nefarious troops of words and deeds. Let them know, that we see this gathering storm. Let them know, that we will prevail against all adversities – and, win today and all the many days that lie ahead. So, let them know!

An Outraged and Inspired,

Dr Peter G Kinesa
February 15, 2013

A gathering let them know!

Preaching to the converted here Jim; as shortages, not just in fossil fuels, but in many other key non-renewables should see hard commodity prices spike a 1000% plus, in 30 years. Soft commodities will also experience similar lifts as usable farmland is lost to climatic chaos and unfettered development. All of which makes no sense whatsoever, when projected increases in population  range from 2 to 3 billion during this period. Now crunch these numbers. 

That's why we agree, and say that this mess just doesn't pencil out.

First Financial Insights
February 14, 2013

Secrets of Crunching Numbers 

Eric Sprott is interviewed by Greg Hunter of USA WatchDog. Eric discusses how the bond markets has become a farce and that it could col...

When the brightest "independent" investment and economic thinkers are all singing from the same page - well you think that there might be a little more substance over form in their carefully and wisely constructed professional views. We certainly do not ignore the leading chorus of Eric Sprott, Peter Kinesa, Marc Faber and Jimmy Rogers - and, of course, yours truly. One would be foolish not to believe that there is something in the wind and coming soon - and it is not the Easter Bunny.

In short, what all of us are saying is that at any moment bonds could collapse sending the global economy into a New Dark Age. Such is the wisdom of your "Council of Elders."

First Financial Insights
February 13, 2013

"So Eric, Peter and Marc now agree with Jimmy, right?"

Marc believes markets are topping out and points to Apple's 30% decline as to how stocks can rise then fall back again. So short term, he thinks that a 10 to 30% reversal is still in the cards. He points to the sell off that occurred in 1987, when stocks collapsed 40% in two month after a preceding 44% run up.

We concur with Faber, that the risks are high in the short-term, but we know that markets can climb the wall of worry, despite rational fundamentals. It has its own mind; perhaps abetted by the flash- traders dance, thereby becoming more of a casino. However, as there is no strong rational for any long-term positive sentiment, we are biased towards short positions particularly in US Banks, Brokers and Treasuries. Tech companies should also see valuations punished more than the broader market. Facebook and Apple are still high on the list.

The turning point will be the collapse in Bond Market that is long over due, as everyone knows that the inflation figures are being rigged by Washington to keep rates low. This game cannot last, as sooner or later the market sees through such things; albeit the FED can continue to prop it up by printing more money.

These are time to be extra careful. Period

First Financial Insights
February 12, 2013

Funny Money Games: When Seven is Eleven?

Who could dispute Jim's logic on this bet? First, water is the most essential ingredient required by farmers to ensure the delivery of their harvested crops. Our food stock capacities are thus directly tied to  the adequacy of water supplies. Global populations continue to grow at a rate of over 1% a year with no signs of abatement. We are thus annually adding close to 100 million new mouths to feed.

Now at the same time, farmland and water is contracting due to commercialization, climate and polluting elements With each day, farmland and water are thus becoming more vital to the subsistence of global populations. In fact, China is now importing Great Lakes Water from Lake Michigan through Nestles. This is a sure sign that the supply of fresh water has deteriorated to an unacceptable level in a maior industrial nation. "Serious and deeply disconcerting."

So we are on side with Jim here, but the question is how to invest in this critical sector? Not equities for sure, as the levels of global systemic risk are presently much to high, in light of sizable increases in global interest rates, pending. To be short, we return to a buying farm - Jim's top investment pick - with one additional caveat ; just make sure it has an assured supply of water on the property.  

First Financial Insights
Febrauary 10, 2013 

Running on Empty