Sunday December 11, 2016
Re: Birthday Card – Socrates and WEC – The Markets – Day Trading this week - Points to Ponder and My Take on them
Birthday wish and Card via e-mail
Thank you Fedor for the wonderful Birthday Card you e-mailed. The card reminds us that although, Nature can be very powerful and devastating - - - it remains absolutely wondrous and awesomely beautiful.
My World Economic Conference 2016 Notes (WEC 2016)
On Friday I completed the dissemination of my WEC 2016 ‘Notes’. I hereby would like to thank all of you who contributed US$1,000 to my November trip and attendance at WEC 2016 in Orlando, Florida. I am pleased that in return for your contribution, I was able to send you my Conference Notes.
Socrates and (WEC)
MA Blog December 9: “Given the fact our [Socrates] model has been correct on the politics, stock market, gold, interest rates and the dollar, obviously more and more people want to attend [our WECs]. We respect the necessity to try to accommodate everyone. It’s not always easy.”
The Markets Moving Forward
The odds still are that we will see THE low in Gold below $1,000 before the end of the 1stQuarter of 2017 instead of having to wait for THE low in 2018. We still need to see the closing numbers on Friday December 30 for confirmation one way or the other.
The Month-end November close for the Dow was 19,123 indicating the Dow is still in a Bullish Trend and will remain in that Trend going into 2017.
With regard the impact on the Dow by Trump and the Federal Reserve, let me recall and tell you about the following conversation I had on Friday evening when I attended a Christmas dinner party for our local tennis club.
A fellow tennis player and investor said that the Dow and S&P were a Trump Rally. He also said that he was worried that the December 14 Federal Reserve Interest Rate Hike would have a negative impact on stock buying.
I did agree with him that the Trump election had a certain impact on stock buying and if there was, in fact, an increase in rates by the Federal Reserve on December 14 it would have only be temporary and have a slight negative impact on stocks (Read the MA Blog posted yesterday).
I told him that the reason that The Dow reached a record high was mainly because of worldwide uncertainty and a flight to safety of capital with the result of huge Money Flows into US dollar from all over the world and that it was not just because, of the Trump election or a potential of an interest rate hike by the Federal Reserve.
MA December 9 regarding on Stocks and Bonds:
“Stocks remain the only investment in town and fixed-income the hot potato.”
US 30-year Treasury Bonds MA Blog Friday December 9:
“US 30-year Bonds – The Party is Over”
Day Trading this Week
The Trader Level 1.0 preview is still offline and therefore, we still did not Day Trade last week. We have not received the new version of the Trader Level as of this writing. We will continue not to Day Trade Futures or Options until the launch of the powerful Trader Level version.
Points to Ponder & My Take on Them
1) MA Blog and his answer to a question about Market Manipulation: “Every commodity has been manipulated within the trend for short bursts. It never is enough to change the major trend. They take their profit and then run to the next. They DO NOT manipulate markets systemically like suppressing gold to help the Fed or whatever. Those ideas are even more off the planet. They play markets for a quick profit – in out – goodbye.
The power that be in New York City could not prevent the crash in 2007 despite the fact that [the manipulators] own all the regulators, politicians, and the courts. Even Goldman Sachs needed to be bailed out. So the all-powerful was not so powerful after all was said and done.
So beware. The downside of this conspiracy theory that these people at the top can manipulate society comes with a price – when it crumbles, the confidence vanishes and people are rudely awakened by the fact that nobody is in charge.
We are at the judgment of fate. Therefore, you are correct, when the people had enough the cycle changes.
There is nothing to say here, other than that I fully agree with MA. Manipulation is a finite endeavor based on human greed and it cannot last in the Long-term.
2) On Monday Dec 5 the Dow hit a record high. It was said that this was because, of the US service economy growing at its fastest pace in a year.
As MA says: “All roads lead to the US Dollar”.
Therefore; I believe that most of that record high in the Dow, post the Italian and Austrian votes last Sunday, had to do with the Mooney Flows from Europe into the US Stock Market.
The Dow will keep going up and up. US Investors still believe the Dow will crash at any time and they see no need to jump into the market to buy but, when they do it will accelerate and add to the upward movement in the Dow.
3) AAOIFI the group that sets standards for the industry Shariah-compliant rules for trading Gold and Silver. These new standards have made Gold and Silver acceptable to own as an investment for Muslims worldwide who adhere to Sharia Law.
These, almost there standards, were set with help from the producer-funded World Gold Council, which said the new rules could spur demand for “hundreds of tons” of Gold.
The SPDR Gold Trust, the biggest exchange-traded fund backed by bullion traded under stock symbol GLD, has probably benefitted from that as the new standard opened up new demand from central banks. The standard also applied to Silver and physical Gold bars and coins however, it should be noted that Comex gold futures did not qualify.
This was a ground-breaking initiative for Islamic investors and for the Gold industry at large and a definitive Shariah guidance on the permissibility of investing in Gold. Gold joined equities, real estate, Islamic bonds (sukuk) and takaful (insurance) as vehicles approved for Islamic finance
With turmoil and belief in the Wold financial system waning, Muslims who adhere to Shariah Law will certainly run into Gold and in Africa most Muslims will go into and buy Silver.
With Oil having a problematic and waning investment future in the Middle-East and with worldwide uncertainly in finance - - - the result will certainly spur demand for “hundreds of tons” of Gold and Silver by Muslims, not only from the Middle-East but, expect an accelerated increase in demand by Islamists from all over the wold.
4) MA: “India is now moving to confiscate gold after going after the cash. Currently, each married woman is entitled to 500 grams, each unmarried woman 250 grams, and each man 100 grams of gold. Everything that goes beyond is classified as illegal possession and thus will be confiscated. There is no restriction on the possession of the jewelry only if the jewelry was purchased by inheritance. Prime Minister Narendra Modi is giving more power to the tax authorities rather than dealing with corruption. They will be shaking people down for money. Unlike FDR who confiscated gold from the banks, Modi is allowing the tax people to go door to door.
This is the problem I have been warning about with gold. It is losing it safe haven status for it is getting to the point you cannot travel with it, keep it in a safe deposit box, or show gold with jewelry. In Italy, if it looks like you have excessive jewelry, they pull you over and weigh it at the border.
This is all part of the Hunt for Taxes. India is setting the tone. The danger will be if others follow. Trump would stand in the way of such policies in the United States. But in Europe, we may see the same policies take effect to different degrees. All they need do is claim that terrorists are using gold to fund their operations.”
What those in power don’t understand is that on the surface Indians will comply but, as smart people always do, they will still buy Gold but, they will buy it illegally in the underground Gold markets.
In India you just can’t change hundreds of years of buying of Gold. Gold is prosperity for the people in India and it is the like the Chinese owning land for centuries people in India will somehow find a way to buy - - - Gold!
5) Yesterday December 10 MA wrote: “Mario Draghi extended the European Central Bank (ECB) $ 1.74 trillion bond purchase program to support the economy by nine months to at least the end of December 2017. This is far longer than most economists had expected. However, the monthly volume of currently €80 billion euros will drop to €60 billion euros from April 2017 onwards. In total, a further €540 billion euros will be pumped into the market. However, there is still no indication that this will have any inflationary influence. All it appears to be doing is slowing the collapse buying bonds the private sector does not want.
According to German newspaper the Frankfurter Allgemeine Zeitung, the decision of the ECB to expand its bond purchases was objected to by the Bundesbank President Jens Weidmann. The newspaper reported that Weidmann had expressed objections and had not voted. The Bundesbank did not wish to comment on the report.”
€540 billion euros is still a lot of money be pumped into the bond market but, it will not stop the inevitable bond crash. I believe that this extended support for the bond market by the ECB will give Europeans some added time to sell their bonds and use that money to buy quality US stocks.
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Nick L. Nicolaas
Direct: +1 (604) 657-4058
Nick L. Nicolaas; Mining Interactive Corp. and its Associates (collectively referred to as NLN) are not registered advisers and do not give investment advice. NLN’s trading comments are an expression of opinion only. NLN may have an investment in some of the companies or trading instruments NLN mentions or writes about, nothing should be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity or any other financial instrument at any time. While NLN believes all statements to be true, they always depend on the reliability of NLN’s sources. NLN recommends that you consult a qualified investment adviser, one licensed by the appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions and NLN urges you to confirm the facts on your own regarding any trades or companies NLN mentions before making important investment commitments. The “Stock and Private Placement” alerts written and distributed by NLN do not, and cannot, constitute a recommendation to buy or sell any security.
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The material in the “Trading Based on Martin Armstrong Socrates Alerts” and the “Stock and Private Placement” alert letter published by Nick L. Nicolaas is for informational purposes only and is not intended to and does not constitute the rendering of investment advice or the solicitation of an offer to buy securities. The “Trading Based on Socrates” and the “Stock and Private Placement” alert discussion contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (The Act). In particular when used in the preceding discussion the words “plan,” confident that, believe, scheduled, expect, or intend to, and similar conditional expressions are intended to identify forward-looking statements subject to the safe harbor created by the ACT. Such statements are subject to certain risks and uncertainties and actual results could differ materially from those expressed in any of the forward looking statements. Such risks and uncertainties include, but are not limited to future events and financial performance of the company which are inherently uncertain and actual events and / or results may differ materially. In addition we may review investments that are not registered in the U.S. We cannot attest to nor certify the correctness of any information in this note. NLN owns shares in Meadow Bay Gold Corporation. Please consult your financial adviser and perform your own due diligence before considering any companies mentioned in this informational bulletin.
December 11, 2016