[Money-matters] Money Matters Update Oct 16 2008

Fri Oct 17 02:59:14 UTC 2008

Oct. 16 (Bloomberg) -- The Federal Reserve's direct loans to commercial 
banks rose to a record $101.9 billion yesterday versus $98.1 billion a 
week earlier as still-high money market rates encouraged more borrowing 
from the lender of last resort.

Bloomberg:  US Govt announced Social Security checks to grow nearly 6 
percent -- a little help for retirees' falling stocks.
_/*
Marc's Notes*/_

Take a look at the 6 % increase the government is applying to SS. I 
thought they said inflation was 2.5 %?  Then why are they raising it 6%?
I am FOR this increase but it just goes to show the discrepancy from one 
source blatantly contradicting their own inflation figures.
Like I said, inflation is al ot higher then their "official" figures and 
now they just verified it.

Now take a look at the FIRST headline. Central bank lending is 
INCREASING !  Why are banks borrowing even MORE ?  Didn't they tell us 
things would get better with all this money they keep throwing around? 

Like I said, its getting WORSE, and their lending proves it.

And remember the BOND INSURER bail out I said was coming next? Well look 
what supposedly spurned the rally today:    Just out....

Ambac, Bond Insurers to Present Treasury With Plan (Update1)

By Christine Richard

Oct. 16 (Bloomberg) -- Ambac Financial Group Inc. 
<http://www.bloomberg.com/apps/quote?ticker=ABK%3AUS> and other bond 
insurers are working on a plan to send to the U.S. Treasury that would 
enable them to sell troubled assets to the government, Chief Executive 
Officer Michael Callen 
<http://search.bloomberg.com/search?q=Michael+Callen&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1> 
said.

There you have it. The BOND INSURER BAILOUT !  >:o  This is outrageous. 
These bond insurers made billions taking payments to insure bonds in 
case of default. Now that they are defaulting, they cant pay and are 
asking taxpayers to pay for them. What kind of system is that? Is anyone 
asking for their bonuses or salaries back? Of course not.

This is a joke. We should throw all the Congressmen and women OUT now. 
Pelosi, Feinstien, Dodd, Frank... they are all crooks and millionaires 
and bums.
They should be hung from the trees and burned at the stake. This is 
disgraceful! Our founding fathers would be turning in their graves.

For our next act:   The next  bailout  
is.................................................................................The 
Pension Benefit Guarantee Corporation.

They insure pensions.  The only "guarantee" they provide is using OUR 
funds to guarantee someone else pensions.
I cannot make this stuff up!
Like I said, WHO IS NEXT in line?     Is this not getting just simply 
insane or what.
The rally was based on this insurer bailout. How crazy is the this?
What rally it is, it wont last. These are sucker rallies to get you to buy.
_Beware_: The big firms are UNLOADING their stocks onto mom and pop 
investors who haven't a clue.

_/*Consider:*/_
Use rallies to get hedged.  Contrary funds. If you own stocks and mutual 
funds, use rallies to get OUT.
You may miss a rally or 2 but be spared the pain of the BIG ONE which is 
coming.
Gold hammered again, but as a listener called in on todays show- She was 
told there were NO SILVER COINS available. Does that sound logical to 
you if the price is FALLING?
Can you say MANIPULATION?
I dont care. I am buying more.  WHEN ( not if) the foreigners have had 
enough of our PRINTING and bailouts, they will EVENTUALLY sell the dollar.

Want out of this market?  BANK CDS   They pay 3 to 4 % and are insured. 
Its all about capital preservation right now until this settles or explodes.

This is a VERY DANGEROUS MARKET. ( Figured that out yet?)

Also consider  T BILLS  and T BILL funds.   VIPSX  SHY  TIP  Hedge these 
with RRPIX  interest rate fund. Equal amounts.

BONDS?  NO !  It is debt and I hate debt right now. Those owning bonds 
have been hammered. Thats why I said GET OUT OF BONDS over 2 years ago 
and I keep saying it.

_/*
Advanced traders:*/_
A caller mentioned OIL using USO as a vehicle. Oil may continue down, 
but not much farther.
I may consider USO myself for a LONG TERM hedge against inflation. It 
could still fall but the downside is decreasing with every tick down. I 
dont expect so see oil at 40/ brl so I think USO downside is 40 with an 
upside of 100, 150  or 200.   I am considering a small amount placed 
here. I may also option this thru  IYSVD    CALL  2009 strike date/ 
price. 100  APRIL 2009

Retailers and Housing:  SHORTS:            MARRIOT   CARNIVAL SEARS  
NORDSTOMS   JC PENNEY   STARWOOD HOTELS   
you name it, I am shorting it.   
Take profits on crashes. Establish new positions on Rallies ( like today).

_/*Markets:*/_
Negative bias rules. I would not rule out a huge slide. Rallies may 
interrupt us but the fundamentals are so terrible I just cannot see an 
extended multi week rally.
The wild card is the US dollar. Pray it doesn't crash. So far, it looks 
semi strong, but a black event could happen anytime.
I hold a lot of BEARX for hedging my dividend paying stocks which are 
still paying me. I added a small amount of the dividend payers today but 
these are stocks and any slide will take them down as well. The  40 % 
yields tempted me to tip my toe in a bit!
_/*
Upcoming show:*/_
2 HOUR PLEDGE SHOW next THURSDAY at noon.
Whether you pledge or not , I will have 2 hours to cover ALL your 
questions so dont miss it.

All the best,
MARC

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