OK… Another day here in Sin City… This city is packed with people, everywhere we go, it’s simply amazing… There’s been no sign of a recession here… Of course, if you got out of the casinos, and shows, you would see some of the greatest devastation any where in the housing market here… So.. It’s not a seashells and balloons in Vegas… I guess with the economy so rotten, people are hoping to strike it rich in the casinos though… Hmmm, have they not figured out that these ginormous buildings are here to make money?

The Currencies lost ground yesterday, most of the day, and then overnight too… Not major ground, but ground that had been previously won VS the dollar, not something a dollar bear wants to see. There’s more rot on the economy’s vine, this morning with Retail Sales, and all that euphoria that was in the markets last week, is dissipating, quickly… So, let’s go to the tape on Retail Sales…

Retail Sales for April were down again (the BHI was wrong! YIKES). The .4% fall in April added to the .9% fall in March (revised to -1.1% today) tells me that after signs of consumers picking up spending again in the fist two months of the year, this is turning out to be an absolutely dreadful quarter for Retail Sales… Oh, and let’s go back to the GDP print of about 2 weeks ago… There was hope in the GDP figure that “consumption” may pull the economy out of the recession, for consumption was up 2.2%… But with these Retail Sales figures so far in the 2nd QTR, you can kiss that hope good-bye!

This is the kind of stuff I was all worried about the other day in the Pfennig… Recessions are like that… You get a pop, but it has no legs, and then leads the economy right back to the depths of the recession… This is why I wanted to get the currencies back on the fundamentals of having different pricing mechanisms and low correlations to stocks… The diversification fundamentals that have been forgotten in the past 6 months….

And… Here’s a good one for you… OK… Who said this… “Even though we have been having some fairly strong gains in home prices, it is our conclusion that it is UNLIKELY that we are confronting a housing bubble.”

Give up? It was a quote in the 2002 Fannie Mae Annual Report… By our esteemed (NOT!) former Fed Chairman Big Al Greenspan! This guy’s track record of forecasting going all the way back to his days as a consultant before he was brought on at the Fed, is absolutely horrible! Now… Why do I bring this up now? Well… Yesterday, Big Al Greenspan decided to give us a forecast that allowed stocks to recover on the day… What did he say this time? Greenspan said in an interview that “Housing May Have Bottomed and be a the verge of a recovery.”

Oh boy, now that’s something to hang your hat on, eh? I shake my head in total disgust… This man was at the root of the whole problem, and people still listen to him?

OK… Enough on that exercise… I could write for days about all the things he has done… But, better yet… Go to Amazon and buy Bill Fleckenstein’s book on the Fed and Greenspan…

My friend, John Mauldin, wrote a great piece last Friday for his weekly newsletter regarding all the talk about Green Shoots… The Green Shoots were the thoughts that data prints were getting better (so they thought) and that the economy was getting better… John pointed out that he didn’t believe the green shoots were for real, and said they probably were more like dandelions… I totally agree… Both he and I took the Jobs Jamboree data that was considered a Green Shoot, and tore it apart to expose it as the fraud it was… No Green Shoot here!

Here’s another one… Import prices in the U.S. rose by 1.6%… That’s HUGE folks! I saw something that said that in the last 100 prints of this data there have been only 12 larger prints! YIKES… Here’s the skinny… Recall, that I’ve told you that China’s stimulus was working and that they would be the first country to come out of the economic doldrums… Well, with their stimulus working, that means commodity prices will be rising, and if commodity prices rise, that means inflation will rise… No Green Shoot here!

OK, enough of that! Did you see where the Obama The Obama administration has begun serious talks about how it can change compensation practices across the financial-services industry, including at companies that did not receive federal bailout money?

See? I told you that you give the Gov’t a foot in the door, and they will begin to push their way completely through the door… And with banks that’s exactly what’s happening… Isn’t that sad? The Gov’t wants to dictate how banks pay their employees, even if they didn’t accept TARP money! How do you like being put on the train to socialism? And you can’t get off?

I had better stop there, I might say something that would get me into trouble!

Well… There was another thing that showed up yesterday that could mean very bad things for the U.S. and their ability to attract financing… The Financial Times ran a story regarding the U.S.’s Triple A rating… Let’s see what The FT had to say…

“Long before the current financial crisis, nearly two years ago, a little-noticed cloud darkened the horizon for the US government. It was ignored. But now that shadow, in the form of a warning from a top credit rating agency that the nation risked losing its triple A rating if it did not start putting its finances in order, is coming back to haunt us.

That warning from Moody’s focused on the exploding healthcare and Social Security costs that threaten to engulf the federal government in debt over coming decades. The facts show we’re in even worse shape now, and there are signs that confidence in America’s ability to control its finances is eroding.”

Hmmm… That’s scary folks… And… To add to that, an attendee came up to me yesterday after my first presentation, and said, “Chuck, great talk, but you didn’t mention the debt that the U.S. will have to deal with in the future.” Yes, he’s right… I don’t do that very often because I don’t want people going outside and throwing up, or even worse things. What I’m talking about here is the debt that the U.S. will be under when all the Baby Boomers are drawing Social Security and Medicare… If you are not aware of these figures, and how bad they will become… Go to Amazon and buy the I.O.U.S.A. book by Addison Wiggin and Kate Incontrerra…

OK… Time to go to the Big Finish, I’ve got to go through my presentation once more before I head down to the Show…

Currencies today 5/13/09: A$ .76, kiwi .5970, C$ .8590, euro 1.3610, sterling 1.5165, Swiss .9045, rand 8.4950, krone 6.5150, SEK 7.8710, forint 208.15, zloty 3.2575, koruna 19.7090, yen 96.17, sing 1.4630, HKD 7.75, INR 49.71, China 6.8230, pesos 13.34, BRL 2.0960, dollar index 82.61, Oil $59.09, Silver $14.09, and Gold… $926.90

Source: He Said What?

Under Armour (NYSE:UA) is doing what it does best, using marketing glitz to gain the attention of consumers and investors. As I have said countless times before, it is not a sustainable business model.

While slurping down my morning bowl of cereal, I typically watch something with a bit more grit than NBC’s Today Show (even Screech on Saved by the Bell offers more intellectual value), but my wife had the day off work and somehow gained control of the remote.

I am glad she did, because as soon as I saw Under Armour’s founder Kevin Plank chatting about his company’s “unique” product offerings, I knew my recent preachings were dead-on accurate. This company is getting desperate.

If you follow Under Armour, you know its products, while popular, are certainly not unique. Lower-priced competitors have been busy knocking away the company’s foundation one brick at a time. Plank and his company were hoping for a huge launch of their footwear line, but have failed on several different attempts to gain the attention the company needs to meet shareholder expectations.

Share price won’t need running shoes

In less than two weeks, investors are in for the wake-up call they need. When the company releases its latest earnings figures, Under Armour’s overvalued shares, with a P/E of 23 and all, will get cut to where they belong. I am prepared to see shares drop to $14 or less on news sales were nowhere close to investor-expected levels.

Yesterday’s retail sales figures were a foretelling of what’s to come.

Read the full article here at TFN:Under Armour: Desperate for attention

Stocks of distillates grew by 6.4 million barrels last week amid weak demand, while crude and gasoline inventories also rose, the Energy Information Administration said.

“Inventories continue to build. This morning we had negative sales numbers. This is more economic weakness affecting demand,” said Tom Bentz of BNP Paribas Commodity Futures in New York.

U.S. crude was down $2.08 at $35.70 a barrel by 1618 GMT after earlier hitting a high of $39.45. London Brent crude fell 88 cents to $43.95 a barrel.

The inventory report added further pressure to prices after weak U.S. retail sales data sparked selling earlier in the session.

The U.S. Commerce Department said total retail sales fell 2.7 percent to a seasonally adjusted $343.2 billion last month. Analysts polled by Reuters had forecast December retail sales falling 1.2 percent.

“The retail sales figures are horrible. They confirm that the United States is in recession, which means oil demand is falling and so the market is weakening,” said Rob Laughlin, senior oil analyst at MF Global.

The global financial crisis, the worst since the 1930s, has pushed much of the industrialised world into recession, causing oil demand to slump and crude prices to tumble by more than $100 from its record peak of above $147 a barrel last July.

Oil producers in the Organization of the Petroleum Exporting Countries have responded to the recession by cutting output.

Top exporter Saudi Arabia said on Tuesday it was prepared to go even further than cuts it had made since December if the market warranted it, while OPEC’s secretary general said the group may reduce oil output again at its meeting in March.

Libya’s top oil official said on Wednesday OPEC’s existing oil output cuts should support oil prices and that it was too early to tell if a further production reduction.

OPEC decided to cut supply by 2 million bpd at meetings in September and October. In December, it agreed to lower output by a further 2.2 million bpd as of Jan. 1, a record reduction.

So far OPEC’s moves have had little obvious impact on the market and oil for prompt delivery is trading at a big discount to future barrels with the market in what is called a contango.

The front-month U.S. crude contract is also at a record discount to North Sea Brent crude futures with a spread of nore than $8 a barrel between the two contracts.

LONDON, Jan 14 (Reuters)

The reports that matter most come on Friday morning before the market opens.

Friday is when the PPI and Core PPI figures for November are announced, and it is a mixed bag. The Core PPI figures (which exclude food and energy costs) are expected to show a modest increase of 0.20 percent. The PPI figure is expected to show a decline of nearly two percent. This is the direct result of the continued slide in energy prices. The price for energy goods dropped 12.8 percent in October, and I would expect a similar drop this month.

Simultaneous to the PPI announcement on Friday morning are the Retail Sales figures for November. Not surprisingly, the report is expected to show another decline, although not as bad as the October report. With limited access to credit, consumers aren’t buying much right now even though we are approaching the holiday season. The report could get a slight upward bump due to slightly better than expected Black Friday sales. The real interesting report will be next months’ when all holiday sales are figured in.

The final bit of information this week is the December Michigan Sentiment Report. Somehow, someway, in the face of a recession, the report is expected to post an increase this month. It must be the holiday cheer.

Source: PPI and Retail Sales Dominate The Calendar

]]> http://www.contrarianprofits.com/articles/ppi-and-retail-sales-dominate-the-calendar/9715/feed 0 http://www.contrarianprofits.com/articles/gold-lags-other-precious-metals-potential-propping-up-of-dollar-blamed/2909 http://www.contrarianprofits.com/articles/gold-lags-other-precious-metals-potential-propping-up-of-dollar-blamed/2909#comments Fri, 06 Jun 2008 15:57:08 +0000 Doug Casey http://www.contrarianprofits.com/articles/gold-lags-other-precious-metals-potential-propping-up-of-dollar-blamed/2909 Gold had another lackluster day, slumping to $865 just after New York opened, then making its way higher in fits and starts, finishing just into positive territory at $878.00/oz., up 60 cents. Overnight, gold has fallen off.

Platinum also bottomed in the first hour of New York trading, but it then found buyers that took it steadily higher, ending at $2006/oz., up $15. Overnight, platinum is sharply higher.

Silver bottomed at the same time as gold, at $16.50, but then it caught fire, shooting virtually straight up past $17.15 by mid-morning, eased back below $17 into the noon hour, but then re-ignited and closed near its intraday high at $17.15/oz., up 35 cents. Overnight, silver has been trending higher.
(Click here for charts)

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