Best of the Week
Most Popular
1.North Korean Chinese Proxy vs US Military Empire Trending Towards Nuclear War! - Nadeem_Walayat
2.Researchers Find $10 Billion Hidden Treasure In A Dead Volcano - OilPrice_Com
3.Gold and Silver : The Battle for Control - Rambus_Chartology
4.Asda Sales Collapse and Profits Crash! UK Retailer Sector Crisis 2017 - Nadeem_Walayat
5.Deep State Conspiracy or Chaos - James_Quinn
6.The Stock Market Guns of August, Trade Set-Up & Removing your Rose Tinted Glasses - Plunger
7.Gold Stocks Coiled Spring - Zeal_LLC
8.Neil Howe: The Amazon-Walmart Rivalry Will Determine the Future of Retail - John_Mauldin
9.Crude Oil Price Precious Metals Link in August - Nadia_Simmons
10.Gold and Silver Precious Metals Nearing Breakout - Jordan_Roy_Byrne
Last 7 days
Global Financial Crisis 10 Years On: Gold Rises 100% from $650 to $1,300 - 23rd Aug 17
GBP/USD Extends Losses - 23rd Aug 17
Donald Trump Terrorist in Chief, “We Aren’t Nation-Building Again, We Are Killing Terrorists” - 23rd Aug 17
How Planned Fed Rate Increases Impact The National Debt & Deficits - 23rd Aug 17
The 3 Assets to Add to Your Stocks Portfolio in This Rate Tightening Cycle - 23rd Aug 17
Half Price UK Theme Parks Entry 2017 With Cheap Chocolate Packs - 23rd Aug 17
[GIFT] Market Control System! - 23rd Aug 17
4 Reasons European Stocks Will Make a Big Comeback This Year - 22nd Aug 17
3 Lesser-Known Charts Revealing a Massive Stock Market Disconnect - 22nd Aug 17
U.S. Treasury Secretary: "I Assume Fort Knox Gold Is Still There" - 22nd Aug 17
Is the Stock Market Setting itself up for a Spectacular Crash? - 22nd Aug 17
Power Elites Launches Civil War Against Trump - 22nd Aug 17
The Stock Market No Longer Cares About Trump - 21st Aug 17
The Coming Boom Of Productivity Will Get Our Economy Back On Track - 21st Aug 17
Buffett Sees Stock Market Crash Coming? His Cash Speaks Louder Than Words - 21st Aug 17
This Could Be The Biggest Gold Discovery In History - 21st Aug 17
Stock Market Correction in Full Swing - 21st Aug 17
Seeking Confirmations – US Stock Market - 21st Aug 17
The changing demographic of online gamblers - 21st Aug 17
Gold is a coiled spring… the breakout is here, fundamentals are in place, technicals are compelling - 20th Aug 17
A Midsummer Night's Dream: Buy Gold and Silver - 20th Aug 17
Gold Mining Stocks 2017 Fundamentals - 20th Aug 17
EIA Weekly Report and Crude Oil - 19th Aug 17
4 Insights for Adjusting Your Portfolio in a Rate-hike Environment - 19th Aug 17
Gold Direction Indicator - 19th Aug 17
Historical Inevitability and Gold and Silver Ownership - 19th Aug 17
You Are Being Lied To About “Low” Gold Demand - 19th Aug 17
This is Why Cocoa's Crash Was a Perfect Setup - 19th Aug 17
Gold, Silver Consolidate On Last Weeks Gains, Palladium Surges 36% YTD To 16 Year High - 19th Aug 17
North Korea Is Far From Being Irrational… It Has A Plan - 18th Aug 17
US Civil War - FUNCTIONAL ILLITERATES TRYING TO ERASE HISTORY - 18th Aug 17
Bitcoin Hits New All-Time High Over $4,400 As It Catches Paypal In Total Market Cap - 17th Aug 17
3 Psychological Ingredients behind Great Web Content - 17th Aug 17
The War on Cash - Rogoff, Orwell and Kafka - 17th Aug 17
The Stock Market Guns of August, Trade Set-Up & Removing your Rose Tinted Glasses - 16th Aug 17
Stocks, Bonds, Interest Rates, and Serbia, Camp Kotok 2017 - 16th Aug 17
U.S. Stock Market: Sunrise ... Sunset - 16th Aug 17

Market Oracle FREE Newsletter

3 Videos + 8 Charts = Opportunities You Need to See - Free

Forget Goldman Sachs; Only Fools Rush Into Stocks

Commodities / Gold & Silver Stocks Mar 27, 2012 - 07:06 AM GMT

By: Money_Morning

Commodities

Best Financial Markets Analysis ArticleShah Gilani writes: Is Goldman Sachs (NYSE: GS) playing us all for Muppets when they say stocks now present a generational buying opportunity?

The investment bank's 40-page bullish report, titled "The Long Good Buy: The Case for Equities," says to forget the huge run-up since 2009, forget the 25% rise in equities over the last five-and-a-half months, and forget bonds. This party is just getting started.


Are they right? Yes, they are.

Should you heed their advice and sell your bonds and load up the truck with equities? Hell no.

Goldman's report is like me forecasting increasing dark towards evening. It's too obvious. Of course stocks are a better buy than bonds in the long run when bond yields are so low.

But there's this little problem of timing that they don't address.

If you load up on equities now, and there's a correction, or worse, a double-dip in major market economies, and you get taken to the cleaners, unless you're young enough to hold onto your stocks for a generation, you may be done... as in toast.

Right now is not the time to jump onto the bull market. It looks great, I agree. But this creature is getting restless, and coming into the spring, some caution may be warranted.

If you want to get in, have patience. There's plenty of time, if the markets are presenting a generational buying opportunity.

By the way, they already have had a generational run, and you probably missed it. Did you load up in March 2009? Did you load up in October of last year?

Piling on right now is exactly when the fools rush in. Forget Goldman. You know they fleece their clients. Just because you aren't a client doesn't mean they're not out to use you, too.

The markets didn't rally on the Goldman report. They shrugged it off as mere public relations, perhaps to defray that conversation about the firm playing its clients like puppets.

What drove markets last week was China. There are increasing worries that the Chinese economy may be slowing more than anticipated. If that is the case, if Chinese GDP growth slows to below 7.5%, global markets will cool down. If its GDP growth falls to 5%, or lower, global markets could crash.

Yes, I mean crash, as in, drop 50% in short order.

I'm not saying that's going to happen. But if it does, well, you might not want to dump all your government bonds just yet.

Now, about Jon Corzine...

Proof That Something Is Very Wrong with Our Legal System
Seriously, what is wrong with America's regulatory apparatus? We make laws that don't get enforced when the criminals are too powerful, too connected, and probably have too much dirt on too many other important people to be taken to task.

The guy authorized (forget that "allegedly" stuff; according to the person who he gave the instructions to, he did it) the transfer of customer funds out of MF Global to JPMorgan Chase.

Why? Because they needed to pony up some cash to maintain trading positions they had taken - speculative trading positions that helped sink the company.

There are CFTC regulations about co-mingling customer funds with firm accounts. There are regulations about safeguarding customer accounts. There are laws that support the regulations and penalties for breaking the laws. Regulations are laws.

What I don't understand is this.

Why isn't Corzine being charged with signing off on MF Global's bogus financials as its CEO and being prosecuted under Sarbanes-Oxley?

Stay tuned, because I'm more than curious why this whole affair has the stink of a government cover-up. There's more to this than meets the eye, and inquiring minds need to know.

Lastly, did you hear the one last Friday about BATS?

This Is BAT-ty as Hell
If you don't know, BATS stands for "Better Alternative Trading System." And it is a behemoth of a trading venue. It's an electronic exchange that accounts for more than 10% of total equity trading volume on any given day.

The firm was started by a high-frequency trading pioneer who wanted a better place to do his trading and a better place to attract flies to his spider web.

BATS wanted to raise $100 million in its own IPO last week. It didn't float its new shares on the NYSE. It didn't float them on Nasdaq. It floated its new shares on its own BATS network exchange.

This was a first for BATS. Their IPO was the first IPO to be launched at the BATS trading venue.

And what a blast they had, debuting their own stock on their own exchange.

It was unfortunate - some might call it plain old bad luck - that the day of the IPO, regulators said they were launching another deeper, longer look into the effects of high-frequency trading and the relationship some exchanges (can you say BATS out of Hell) have with high-frequency trading outfits. In other words, they want to know, are there any disadvantages to regular investors? DUH, are these people imbeciles, or what?

For your information, the NYSE and regulators approved a massive new computer warehouse the size of a few football fields across the Hudson from the NYSE, in beautiful New Jersey (maybe the Jersey Shore... and maybe it's run by someone called Snooki or The Situation).

Why so big? So that high-frequency trading firms and hedge funds can "co-locate" their servers right next to the Exchange's servers to reduce "latency" - which means the nano-seconds it takes to push orders around and get them filled.

DUH, these idiots gave HFT folks space next to their computers so they can trade faster, and they didn't know what they were doing? Please, this is comical.

Do I need to mention that Jon Corzine was New Jersey's governor when this was happening? No, you probably knew that.

Anyway, BATS had a bad morning, reading the news after it priced its IPO on Thursday night. But, as bad as the news was for BATS on Friday morning, things were about to get a lot worse.

BATS trading system blew up its own IPO. A software glitch sent the IPO share price from its debut at $15.25 (well below the $16 it was priced at the night before) down to a fraction of a penny in a matter of seconds.

It was all over in about nine-and-a-half seconds. The IPO was withdrawn, and a lot of insiders' dreams of summering on the Jersey Shore were squashed.

Now, don't get me wrong, I never wish anything bad on anyone. Well, usually not. But somehow I can't help but laugh at this extraordinary kerfuffle.

Source :http://moneymorning.com/2012/03/27/forget-goldman-sachs-only-fools-rush-in/

Money Morning/The Money Map Report

©2012 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email: customerservice@moneymorning.com

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2017 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife