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The Unseen Costs of Obamacare – Guest Commentary by Richard S. Bernstein October 5, 2010

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The Unseen Costs of Obamacare

By Richard S. Bernstein

Chief Executive Officer,

Richard S. Bernstein & Associates Inc.

Last week, I received two visits from employees, both with the same question:  “You mean I’m going to have to pay income tax next year on the health insurance benefits you give me?”

The only answer I was able to give them was: Not yet.

It has been six months since Congress passed the Patient Protection and Affordable Care Act, yet still, we continue to find and learn new things about how the “Obamacare” health care bill will affect the average American.

What my two employees recently learned was that, beginning in January 2011, every American who receives health insurance through his or her employer will see that insurance benefits show up in his or her W-2 form. For the time being, that doesn’t mean they are paying taxes on this benefit – only that they are disclosing the value of that benefit to the government.

Raise your hand if you believe this won’t lead to a new tax? After the midterm election, of course.

Meanwhile, many of the Americans who can least afford a new expense arelikely to see one, unless Congress repeals another facet of Obamacare. McDonald’s Corp. this week announced plans to drop the low-cost, effective health care plan it offers to nearly 30,000 hourly restaurant workers if that clause – which mandates that a certain percentage of revenue has to go to claims rather than administrative costs – is waived. If that happens, those hourly workers – all of whom likely fall into the group of Americans that Obama promised not to raise taxes on, as they make less than $250,000 a year – will find themselves paying significantly more for health insurance.

While this isn’t precisely a tax increase, it creates the same effect: it takes money from Americans’ pockets, many of whom are living paycheck-to-paycheck.

This is a real effect of Obamacare that will affect their quality of life; even more than that, it is a real effect of Obamacare that will decrease Americans’ spendable income – and that will be felt throughout our economy.

I say this as a person who works in the insurance industry, and who strongly believes that our nation’s health care system rode off the tracks many years ago. In some places, Obamacare will help put us back on track: that the bill has removed lifetime limits on insurance coverage; that it has prohibited insurance companies from rescinding coverage, or from discriminating against Americans with pre-existing conditions – these are good things that have been a long time coming.

But, like a young woman preparing for the prom, the cost of changing our health care system isn’t as simple as paying for the ticket. That young woman needs

a dress, shoes, accessories – all things that come with an extra cost. The same is true of our health care bill – everything comes with an extra cost.

And before Americans go to the polls this November – where most will, without a doubt, have health care on the brain – they should understand those costs.

They should understand that employers like McDonald’s Corp could drop their affordable health care plans.

They should understand that the cost of both drugs and hospital visits have gone up since Obamacare’s passage, at least partially because drug companies and hospitals don’t know what the future holds, and want to ensure a cash reserve if their finances take a dive under the new health care laws.

They should understand that, if they currently use a Health Savings Account (HSA) to purchase over-the-counter drugs, allowing them to write off those medications on their taxes, that practice will end under Obamacare.

They should understand that taking money from their HSA for non-medical purposes will no longer come with a 10 percent penalty; now, that penalty will be 20 percent.  And they should understand that their Flexible Spending Accounts (FSA) will be capped at $2,500. So the payroll deductions that currently go into Flexible Spending Accounts tax-free will become capped under Obamacare. And in today’s medical world, $2,500 doesn’t go very far.

In all, there are more than 20 examples like this – new, higher taxes that will go into effect under Obamacare, some as soon as January 1, 2011.

And that’s only what we’ve found so far.

Richard S. Bernstein is one of the nation’s top insurance advisors to high net worth individuals, businesses, and charitable organizations.  He’s been featured in many national publications and has joined The Mangru Report on Fox Business as a featured panelist. You can find out more about Mr. Bernstein by visting his corporate website www.rbernstein.com

A Candid Appraisal of the Recovery – John Browne Commentary October 1, 2010

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A Candid Appraisal of the Recovery

By John Browne

Over the last two weeks, seemingly good economic news offered some shreds of optimism to a stock market that was desperate for a pick-me-up.

The week before last, the National Bureau of Economic Research declared that the US recession had ended back in June 2009. At the beginning of last week, news came in that month-on-month retail sales had risen by 0.4 percent. Combined with successful government debt auctions in the eurozone, increasing expectations that Republicans will take back the House (thereby blunting the leftward drift of Washington), and hopes that a new round of quantitative easing will pump up growth, mainstream analysts are developing a feeling of near-euphoria.

Although it hard to begrudge the punch drunk for grasping at a little hope, investing is a dispassionate endeavor that calls for close and realistic analysis. In that spirit, let’s dig deeper into the recent ‘good news.’

First, the single month’s rise in retail sales was a blip on what has been a long-term downtrend. Furthermore, retail sales in August typically get a large boost from seasonal ‘back to school’ spending. This year, retail sales were boosted further by temporary tax incentives and vendor discounts.

Second, the successful auction of debt from worrisome eurozone countries, like Ireland, only served to further camouflage the ongoing risk of sovereign default by these states. None of them have committed to a comprehensive program of austerity and market liberalization – Ireland maintains a ‘too big to fail’ doctrine while Greece is on the verge of riots from its so-far modest efforts at privatization. None of the PIIGS would have had successful bond sales if Germany hadn’t been pressured into becoming a ‘sovereign of last resort’ for the whole currency area.

Apart from health of the weakest nations, a more important issue is understanding how sovereign debt is analyzed by investors in the first place. Those who consider buying government debt have for many years relied on backward-looking measurements such as debt-to-GDP to analyze the investment quality.

But that’s only half the picture, and oftentimes it’s even less than that. It does not include off-balance sheet items such as unfunded pensions, social security payments, or health obligations. For the US, I estimate this total debt amounts to some $134 trillion – nearly ten times the ‘official’ figure.

On a deeper level, using the public debt-to-GDP ratio to assess sovereign solvency implies that governments have access to the entire annual production of their economies. In reality, they have access only to that portion which is taxable. As taxes increase, there are natural limits imposed by increasing inefficiency and avoidance behaviors. Therefore, ‘net GDP,’ the portion available to the government for debt service, is significantly smaller than the gross GDP of the nation.

With real government debts, including off-balance sheet items, far larger than officially recognized and net GDPs far smaller that top-line GDP, the solvency of many sovereigns should be considered dubious at best.

For example, the debt-to-GDP ratio of the United States is currently 65 percent, which puts the country towards the solvent end of the debt spectrum among developed Western nations. However, the real debt-to-net GDP ratio is a staggering 358 percent, making the US the most insolvent nation in the group, behind even Greece!

In the interest of brevity, I will only touch on the fact that the above number is actually still an underestimate. It does not account for the portion of gross GDP claimed by state and municipal governments to service their debts. After all, all levels of government tax the same base. So, the effective portion of GDP available to the US federal government is even smaller still.

The third problem with the late round of ‘good news’ is that while a GOP sweep of House races looks likely, it is unlikely to make a large impact on policy. It is doubtful that the small number of freshman GOP Representatives will be able to win over their more mature, big government-minded colleagues. Any pending GOP ‘small government’ revolution will be heavy on talk and short on accomplishments.

It should come as no surprise that the Republicans’ “Pledge to America” lacked specific commitments for cost-cutting. Republicans are terrified of becoming the party of austerity, and the next Republican President will want to avoid being seen as ‘Hoover 2.0’. Therefore, any structural changes will come slowly – and perhaps too late.

Finally, whatever actions the Fed takes in the name of further stimulus will have the same unintended consequences as all previous stimulus efforts. Long-term sustainability will be sacrificed in favor of a short-term boom. Since World War II, the underlying strength of the US economy has allowed the central bank to get away with this strategy, as the economy simply outgrew the inefficiencies caused by monetary manipulation. But what happens when we are in a period of secular decline?

So we see that Wall Street is again playing the part of Pangloss. Unfortunately, their purported inklings of a renewed rally in the US markets do not stand up to candid appraisal.

John Browne is the Senior Market Strategist for Euro-Pacific Capital and a featured panelist on The Mangru Report on Fox Business.  To view his previous commentaries please click here.

Freedom Fest Panel – Alternative Investing – The Mangru Report on Fox Business September 24, 2010

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Watch extended coverage from Freedom Fest 2010 with Dan Mangru moderating a special panel on Alternative Investing.  While so many investors are confused as to what that actually is, for the purposes of this panel alternative investing is any type of investment outside of stocks, bonds, options and mutual funds.

The panel features David McAlvany of McAlvany Wealth Management, Van Simmons of David Hall Rare Coins, Jack T. Reed author of How to Protect Your Life Savings, and Terry Coxon of Passport IRA.  They will provide key insights on topics such as gold investing, the currencies most likely to beat the U.S. dollar and why the U.S. dollar might be good to hold in the short run, whether investors should pay down debt as opposed to making new investments, how to buy real estate during hyperinflation, and the importance of liquidity.

Worried About Your Wealth? – READ THIS TODAY September 19, 2010

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The chart doesn’t lie.  Just look at the Dow and what it’s been doing this year.

First it goes up, then takes a big drop down, has a huge run up, then takes another dive, and so on and so on.  It seems as though the market has been more volatile than ever, leaving investors with very little direction.

I mean just when you think you’ve got the market figured out, it goes in the exact opposite direction.

For instance, many people are now fully aware that our economy is in bad shape.  Our national debt is approaching $14 trillion dollars, 25% of homes have more debt than what they are worth, there is at least $1 trillion of hidden losses in Fannie Mae & Freddie Mac, and to boot, unemployment has been at around 10% for the better part of this year.

Yet with all of that bad news, the DOW has rallied from lows of 6500 just last year in March 2009, and has for some reason or another been atop of 10,000 for most of the last year even with all of the volatility.

So what is an investor to do?

One of the adages on Wall Street is that information that everyone knows is not worth knowing.

The reason behind that is because if everybody already knows something, then most likely, that information has already been factored into the price of a stock.  So when many people were trying to sell stocks and go short the market because of bad fundamental news (unemployment, national debt, etc.) and lost a lot of money, they didn’t understand that the market had already factored in that information into stock prices.

The problem that many people have is that they decide what direction they think that the market is going to go in and then find information and data that support that idea.  That’s how many brokers and so-called “experts” have led their clients astray.

There are certain key data that will tell you where the market is going (industrial production, job postings, etc.).  The key is to be able to look at that data without any preconceived notions.

That’s what we do at The Mangru Letter.  We look at the market for what it is and not for what we want it to be.  If the market is telling us to buy, we buy.  If it is telling us to sell, we sell. (CLICK HERE FOR A SPECIAL MANGRU LETTER OFFER)

By staying true to being unbiased, that’s how myself along with my associates have helped thousands of Americans to generate substantial gains while keeping them informed about life-changing economic and geopolitical developments.  Now, you too can have access to the same type of information that helped investors to avoid the big downturn in the stock market during 2008 and to participate in the dramatic increase in stock prices during 2009.

That’s why I’d like to invite you to join us here at The Mangru Letter – a service that will help you to grow the value of your assets during both up and down markets and that will enable you to protect your principal when others are incurring significant losses.

The Mangru Letter TML0001

In each and every edition of The Mangru Letter, I’ll provide you with crucial information on the key factors that are affecting the financial markets and that will enable you to properly position your investment portfolio at any point in time, whether you are just starting out or whether your are getting ready for retirement.

I’ll also provide you with specific investment recommendations for two model portfolios that are structured for both conservative and aggressive investors.

In addition, I’ll share insightful comments with you from proven money managers regarding their thoughts and analysis of the economy and the direction of stock and commodity prices. (TO ACCESS THE MANGRU LETTER CLICK HERE NOW)

The difference between this letter and many others you will see out there is that we make no outrageous promises.

You won’t turn $30 into $300,000 in just one year.  There are no 10,000 % returns.

What we have to offer is honest, solid, unbiased market direction.  We use time-tested proven methodologies that preserve wealth and grow it for the long term.  That’s what we do, and that’s what we’re good at.

So while many newsletters have decided to charge anywhere from $500 to even $2000 per year for “get rich quick” type of advice, we want to make our service available to everyone from the seasoned trader to the mom and pop investor.

That’s why we’ve reduced the price of our service to $99.99 per year, which comes out to 28 cents a day, a small price to pay to potentially save thousands in losses and have the ability to start generating substantial and consistent market returns.

To join our service, just CLICK HERE NOW and add The Mangru Letter to your cart through our secure checkout.

I appreciate you taking the time to read this letter and wish you life, liberty, and pursuit of prosperity.

To Your Success,


Dan Mangru

P.S. – Subscribers to The Mangru Letter are also automatic member of The Mangru Report Insider’s Club which gives you first access to all things Mangru including exclusive interview content with leading business and financial figures such as Steve Forbes, Ron Paul, Peter Schiff, and many more.  Sign Up for The Mangru Letter Today by CLICKING HERE NOW.

P.P.S. Thank you for considering becoming a member of The Mangru Letter. I look forward to a long and prosperous relationship.  To complete your membership process please click the subscribe button below.

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Buy and Hold Still Holds – John Browne Commentary September 5, 2010

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Buy and Hold Still Holds
By:John Browne
Thursday, September 2, 2010

As Americans have justifiably lost faith in the stock market, the classic buy-and-hold investment strategy has fallen from favor. The problem is that retail investors are wrongly equating the performance of stocks as a class with the trajectory of American stocks in particular. Fortunately, buy-and-hold still works in many parts of the world. If you are an American, just don’t try it at home.

The US market is in sorry shape. The Dow Jones Industrial Average and the S&P 500 are presently no higher than they were 12 years ago. If you factor in 12 years worth of inflation, then these results are abysmal. Although American stocks have gone nowhere, extreme economic stress has nevertheless created huge swings of volatility. During the past decade, US stocks have surged 50%, plunged by similar amounts, and then risen and fallen again.

To be a successful player in such a volatile, directionless market requires the kind of knowledge and vigilance that only the best financial professionals possess. The key to trading is the flexibility to make very short-term movements in and out of stocks and sectors, combined with rigorous sell discipline. Oftentimes it means placing a short-term bet on a company and sector even if one believes the move makes no long-term sense. As these capacities are not common among retail investors, who can blame them for heading to the exits?

While attention is often showered on the traders who find success with short-term momentum plays, less attention is paid to fundamental economic growth, which is, after all, the main reason that rank-and-file investors profit from the market. A growing economy lifts all boats, and brings buy-and-hold investors along for the ride.

In recent times, the long-term trend of a massive shift in growth from American and European developed economies to emerging economies, especially to China, has benefitted greatly the buy-and-hold strategies of investors following that mega-trend. I believe that this trend will likely continue over the long-term. I also believe that emerging-market stocks will not be as vulnerable to the next downturn in US stocks as they were in 2008.

Recent conclusions from a number of high-profile research organizations support this forecast. According to IMF estimates, developing economies’ debt will average about 40 percent of their gross domestic product this year, compared with 107 percent in advanced economies. The IMF believes that this comparatively lower debt burden will help the developing economies grow 6.4 percent as a group in 2011, greatly surpassing the 2.4 percent expansion expected in the developed world.

According to Morgan Stanley, emerging-market companies are finding better opportunities to reinvest their earnings, producing a return on equity of 14.8 percent, compared with 10.2 percent in the developed world. *

However, despite this tremendous growth and profitability, shares in the emerging markets remain at attractive valuations relative to the mature economies. In fact, data compiled by Bloomberg shows that for the past decade, except for the 10-month period ending in May 2008 (right before the crisis began), emerging-market shares consistently traded at lower earnings multiples than developed markets. The MSCI Emerging Markets Index has traded at an average discount of about 30 percent to the MSCI World Index during the past 10 years, the data show.  *

Buy-and-hold remains a viable strategy for foreign stock investing at current valuations. The popular alternative, keeping savings in US bank accounts and bonds, is an increasingly risky strategy, in my opinion. While a natural recession would benefit savers and bondholders, as decreasing prices make a penny saved into a penny earned, the US government is determined to continue intervening in the market.

Washington, whether it is controlled by Democrats or Republicans, is unlikely to ever suffer the political consequences of stepping back in the face of recession. So, even while some form of austerity is sorely needed, it is extremely unlikely to be enacted.

Instead, more useless economic stimulus is likely to materialize. While huge infusions of government spending will create the short-term illusion of recovery, the result most likely will be greatly increased taxes, massive debt increases, a further lurch from private-sector wealth creation toward public consumption – and, finally, debasement of the US dollar.

So, retail investors sitting in US bonds and bank accounts will ultimately pay a steep price through inflation. The answer, it seems, is not to abandon stocks, but rather US stocks. Not to abandon buy-and-hold, but to adopt buy-and-hold-elsewhere. And if you were never a stock buyer, there’s always the security of physical precious metals.

For the full text of the article CLICK HERE NOW.

It’s Good To Be “Big” In America – Dan Mangru Exclusive WorldNetDaily (WND) Commentary July 20, 2010

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It’s Good To Be “Big” In America

By Dan Mangru

Read Full Article on WND HERE

It was the best of times. It was the worst of times. It was the age of record profits. It was the age of bankruptcy and corporate cuts. It was a season for bailouts and free fed cash. It was a season for depression and the disappearance of credit.

These sound like two wildly different economies, don’t they? Two wildly different circumstances, two wildly different places. Yet sadly, they are but one United States of America, the land of the haves and have-nots, the big and the small, bailouts and all.

In fact, big is the American way. Big cars. Big houses. Big government. Big everything. We are Americans and we like things big.

So when it comes to big banks and big corporations, we say the bigger the better. Let the good times roll.

And if you are a big company, the times couldn’t be better.

Big corporations and big banks have easy access to credit and low interest rates. This has helped them leapfrog any appearance of a depression.

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For Q2 of 2010 analysts are projecting a 42-percent jump in profit among S&P 500 companies. For Q3 of 2010, which ends September 30, analysts are projecting only a paltry 31-percent jump.

It’s not just profits though. Big corporations are stockpiling their reserves with billions of hard cold cash.

In March 2010, cash on hand at S&P 500 companies rose to a staggering $837 billion – roughly 18 months’ worth of profits amongst those companies.

S&P senior analyst Howard Silverblatt expects that record-breaking number to be even higher when the Q2 April-June 2010 figures are reported later this quarter.

Now you might say, “Well, what about big banks that were supposed to fall, like Bank of America and Citigroup. They are still in trouble … right?”

The answer to that question is absolutely not. Not after the government spent hundreds of billions of dollars to bail out the largest banks.

Want proof? Just look at Citigroup’s balance sheet. Citigroup currently is sitting on $757.68 billion. That’s right, three-quarters of a trillion dollars for one of the weakest banks on Wall Street.

Thank you, Ben Bernanke.

Yep. It is good to be big in America. Big banks and big government all working together in harmony.

So what’s the big deal (no pun intended)?

Well, that little thing we like to call small business is anything but small. You see, small business plays a vital role in our economy.

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Small businesses employ human capital as opposed to offshore human capital like the big boys do.

According to Federal Reserve Chairman Ben Bernanke small businesses employ about half of all Americans and account for 60 percent of job growth.

To boot, the newest of small businesses, those two years and under, account for about 25 percent of all job creation, even though the newest of small businesses employ less than 10 percent of the American workforce.

Essentially, what that means is that small-business jobs are new jobs, and, in an economy which has roughly 10-percent unemployment, the U.S. could use some new jobs.

You are probably thinking, well if all of the big banks and corporations are flush with so much cash then they must be lending to small businesses.

WRONG. Even as big banks have padded their balance sheets to record levels, lending to small businesses is on the decline. Small-business lending has gone from $710 billion in Q2 2008 to less than $670 billion in Q1 of 2010. All of this while bank profits and cash reserves have never been higher.

Something reeks.

Banks make money by lending money, but if they are not lending money how are they making money? Big banks essentially borrow money for nothing from the Federal Reserve and then buy U.S. treasuries at roughly 3.5 percent interest. They have virtually no risk.

Whatever money that they have left over from buying treasuries they lend out to other big companies that are bailout-protected by the U.S. government just so there’s no risk involved.

Why, lending to those pesky entrepreneurs, innovators and small-business men, that’s all a bunch of hogwash. They are too great a risk to the perfect bank plan of no-risk lending and government payouts.

To support that plan, banks have floated the idea that small businesses don’t need money and actually don’t want it.

They have guys like William Dunkelberg, chief economist at the National Federation of Independent Business, who has gone around the country touting the idea that in a slow economy, businesses that may be losing customers may not want to hire new workers, focus on new technology or expand their businesses.

Because, when times are bad, we shouldn’t focus on new technologies, or investing in new human capital to grow our businesses. Of course not.

I want the big banks to produce all of these small businesses who are refusing to take money. I want to meet them. In fact, I challenge the big banks in America to provide the names of 1,000 small businesses that refuse to take their money.

But, just to placate the American public, the big banks decide to lend to pesky entrepreneurs every now and then.

In fact, a couple of the big banks are trying to claim that they are lending more to small business. Bank of America claims to have lent $19.4 billion to small and medium businesses in Q1 of 2010, up some $3 billion from that same period a year ago.

Keep in mind that same period a year ago, the Dow was approaching 6,500 and the world seemed on the brink of utter financial ruin.

But nevertheless entrepreneurs and innovators get a bone from Bank of America. I guess Bank of America thinks they will all just shut up now.

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Some among you might say, “Well, what about interest rates? Are small businesses getting the same interest rates as the big guys?”

Of course not. According to the Federal Reserve’s “Terms of Business Lending,” the average rates on small-business and industrial loans worth approximately $500,000 were 3.5 percent higher than the federal funds rate.

Now 3.5 percent may not seem that high to you but the difference is the highest it has ever been since 1986, which is when those numbers were first tracked.

All of this and Ben Bernanke still doesn’t know why small businesses aren’t borrowing. It doesn’t take a rocket scientist to figure out that, when smallbusiness has to pay an additional 3.5 percent more on interest than everyone else, they probably will borrow less.

That’s just banking 101. But apparently Bernanke didn’t go to class that day when they taught that at Harvard. Maybe he slept through it at MIT.

Bottom line is that he doesn’t get it.

Until the banks have financial incentive to lend to small businesses, they will continue to buy U.S. treasuries and play it safe when it comes to lending.

Big banks are staying close to the federal government, which subsequently is allowing them to make record profits with virtually no risk. That’s a no-brainer for the banks.

Currently, bank minimum reserve rates are roughly 8 percent of overall deposits. The Fed easily could make that 8 percent somewhere between 6 and 7 percent. Along the way it could shut down direct lending and free-money policies that it has extended to Wall Street’s elite.

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Those are two simple ways to get the banks moving toward lending and away from being beholden to the federal government.

But who needs solutions when we have a crisis, and, as White House Chief of Staff Rahm Emanuel says, never let a good crisis go to waste.

So instead of lending to small businesses, which is the traditional role of community banks, we are going to give all of the privileges to the big banks, burden the community banks with interest payments they can’t meet (see my previous article) so that they can go bankrupt and be bought out by big banks. That way the big banks can be even bigger.

Same thing goes for big corporations. Why invest in loaning money to small and medium businesses when we can just wait for them to go under and buy them cheap? That way the big corporations in America get even bigger.

That’s the plan for America. The big get bigger and the small get thrown to waste. Since 2008 some 250 banks have gone out of business. None of those banks was named Citigroup, Bank of America or Goldman Sachs.

For those guys it’s the best of times. Sadly for us, it is becoming the worst of times.

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Regulation Nation – Episode 11 – The Mangru Report July 15, 2010

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Does it ever seem to you that the government’s answer to every problem is more regulation.  Well then my friend, you must live in a Regulation Nation.  In the Regulation Nation segment from Episode 11, the Mangru Report Panel of Experts composed of Armand Grossman (Florida Atlantic University), Lexye Aversa (Professional Touch International), Anthony Pulieri (United Bullion Group), and John Browne (Euro-Pacific Capital) discuss the prevalence of new IPOs in the stock market (Tesla Motors, Primerica, Vera Bradley, Toys R Us)  in spite of the financial reform bill. While some look at it as a positive sign for the market, other experts say it might be companies trying to cash out before the next crash comes.  Find out this and more on Episode 11′s Regulation Nation segment which was brought to you by The James R. Whelan Agency, “The Most Powerful Name in Advertising”.

“More Of” or “Moron”, Regulation Nation, & The Mangru Moment on the BP Oil Spill July 14, 2010

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As part of our best of series for episodes 8-11, we’re bringing you the following three segments: “More Of” or “Moron”, Regulation Nation, and The Mangru Moment, all from episode 8.  For videos and descriptions see below:

Dr. Nouriel Roubini is calling for more aggressive central bank policies and money printing as the answer to the financial crisis in Europe.  Ben Bernanke says that the economy cannot handle higher taxes or spending cuts.  Tim Geithner doesn’t seem to get much out of the Chinese during his “negotiations”.  So who’s a “more of” and who’s a “moron”?  Find out in Episode 8′s edition of “More Of” or “Moron”.

The easiest answer for any problem according to the government is to put a new “watchdog” on the case.  So when bank rating agencies were on the Congressional hotseat, our friends in Washington D.C. got the great idea of putting a new agency/bureaucracy on the case.  Find out more about this in our Regulation Nation segment.

As the BP oil spill continues to go on and one, did you ever wonder where were the other countries to help America?  Everytime there is an earthquake in Haiti or a financial crisis in Greece doesn’t the U.S. always come to the table with at least a couple billion?  Find out the answers in Dan Mangru’s “Mangru Moment” from Episode 8 of the Mangru Report.

Anthony Pulieri: The Bears Running Wild for a Decade in Stocks and the Bulls Charge Forward in Gold…. June 23, 2010

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Exclusive Commentary By Anthony Pulieri

Chief Investment Adviser

Joseph Glenn Commodities

I look at the U. S. stock market and see nothing but the destruction of wealth over the last decade and it sickens me to continue to see an entire society all in and over committed into stocks.  Are you kidding me?

We have just seen The Lost Decade.  The U.S. economy has expanded at a healthy clip for most of the last 70 years, but by a wide range of measures, it stagnated in the first decade of the new millennium. Job growth was essentially zero, as modest job creation from 2003 to 2007 wasn’t enough to make up for two recessions in the decade. Rises in the nation’s economic output, as measured by gross domestic product, was weak.  Household net worth, when adjusted for inflation, fell as stock prices stagnated.  Home prices declined in the second half of the decade and consumer debt skyrocketed.

I continue to see nothing but absolute market volatility and pressure downward.   Whether it was the dot.com bubble bursting, or the massive real estate mortgage foreclosure crisis, all the way to the 2008 market debacle and destruction of wealth, the last 10 years have been nothing but turmoil for the average American.  When it comes to investing, the last 10 years have been nothing but a short term traders market.  The buy and hold strategy that had succeeded for so long is no longer a recipe for success.

I had discussed that this market came way too far way too fast at the peak of 11200 on the Dow and the S&P move to 1200 was not justified.  This was just a short term bear market rally and here we are about to break the important 1040 mark.   If we see this break through a test of 950 could approach very quickly. I am still sticking with my belief of 9000 on the Dow and possibly even lower at 8400 in the short term.  Technically speaking the market seems to be breaking down.  It is having major trouble breaking through the almighty 200 day moving average.  If it is able to do so we could see a short term bounce, but if not the market will experience an extreme sell off and it will happen at lightning speed.

The European contagion has been growing and will continue to spread at a steady pace.  The entire continent of Europe is in major long term trouble and the Euro continues to get crushed. We have seen a dead cat bounce off the lows for the Euro but it is absolutely a flawed currency and the down trend will continue over the long term.  I do not see how this can change in the short term and what this has done is create a lack of confidence globally throughout Europe and America. The stock market trades purely off of confidence and there is none out there.  Can you blame anyone for not having confidence after all the years of credit expansion, easy money and free spending? What do you expect?  We would be able continue to spend at a pace not even imaginable just 20 years back and succeed?  Will the policies ever get reeled in? We have chosen to inflate our way out of it and the Federal Reserve is left with no answer except to print more dollars. The strategy to inflate our way out of the deep recession we are currently in will culminate with the ultimate demise of the U.S. Treasury market and the U.S. dollar.  Large investment flows have been flooding into the U.S. dollar but we have seen that trend reverse this week. This rally is over and we will see the U.S. dollar get demolished in the midterm and long term.  Rick Santelli, said it best, “it is the tallest midget in the room”.

I turn my focus and investors to Gold.   This market is an absolute bull market and has been for 10 years now.  I believe the talk of a bubble is absolutely false.  If you look back to all of the bubbles that have popped what you see is extreme volatility when the top is hit.  We have yet to see any volatility in gold and it has done nothing but built an impressive base technically for 10 years with higher highs and higher lows alongside heavy volume.  A short term move to the downside is possible to 1170 but there aren’t any sellers on any level in gold.  Whenever it dips 10-15 dollars we see more buying right away. So until we break the 5 month uptrend I am no way selling my gold.  I am a long term investor though and always have been.  If we are able to retest and break 1250 I believe 1320 will be hit very quickly.  Ultimately 1500 will be broken through by year end.  Over the long term, 12-24 month forecast, 2000 per oz gold will be met with ease.  Central Banks globally have switched from being net sellers of gold to net buyers.  This is a huge change historically and very bullish.  The global production cannot keep up with demand.  The South African Rand Refinery has seen an increase of 50% in coin demand last month alone alongside an 86 year low in production, yet one more example of the bullish nature of Gold.

I stand firm in my belief that Gold will continue to trend higher because of the lack of faith in fiat currencies. The Dollar has been going down for the last decade and has gone down by about 30% since its high. The euro is in a major down trend due to the European contagion spreading and has just begun.  Gold is the currency of kings and has weathered every single economic storm known to man.  It has survived every major war and will always be a store of value to protect your wealth.  If you look back in history you will see that every paper currency in the history of mankind has ultimately devalued to nothing and gone to zero.   Protect your wealth and buy Gold.  The enormous web of uncertainty permeating throughout the world will continue to drive Gold higher and ultimately lead to tremendous gains in your portfolio.

Anthony Pulieri is the Chief Investment Adviser to Joseph Glenn Commodities.  For more information please CLICK HERE NOW.

Your Government Delisted – Dan Mangru WND (WorldNetDaily) Exclusive Commentary June 21, 2010

Posted by danmangru in Dan Mangru, Market Commentary.
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Your Government Delisted

By Dan Mangru

Whenever I walk into a bank, there is a big sign from the FDIC that says, “Backed by the full faith and credit of the United States government.” It makes us feel warm and fuzzy when we walk into a bank with 1,000 branches and give our hard-earned money to a bank teller we don’t know.

But just how is that full faith and credit of the United States doing these days?

Well, if you ask the New York Stock Exchange, the full faith and credit of the United States government isn’t good enough to keep you trading.

It was announced recently that both Fannie Mae and Freddie Mac have agreed to be delisted from the New York Stock Exchange.

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Even though the federal government has poured $145 billion of your hard-earned tax dollars (that we know of), the markets still have rejected both government entities as not being sound investments.

That’s why shares of Fannie Mae and Freddie Mac have been trading for less than $1 for quite some time and no longer meet the requirements of listing for any major exchange, leading to their rejection.

But why?

(Editor’s Note: For the full article CLICK HERE NOW).

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