VILLARAIGOSA ROLLS THE POLITICAL DICE WITH L.A.'s FUTURE: With Mayor Viagraosa traveling all over the country and spending so much time away from his job as LAUSD cluster-f*cker and occasional mayor of the second biggest U.S. City to campaign so activistly for the quickly sinking Schillary Clinton Presidential dream (more like a nightmare);
when was it decided that a guy could use his position as mayor to roll the dice with the City's political future? You don't see the Mayor of New York or Chicago behaving this way. Here's the problem: What if anyone but Hillary wins? Can you imagine the political payback that will be bestowed upon the City of Los Angeles?
If McCain wins...don't you think he'll return the favor to Antonio for all his effort. The Republicans could withhold money the City and State would have otherwise been granted, if we didn't have a desperate, ego-maniacal,opportunistic, sell out the pueblos embarrassment of three-word speaking Loserosa.
(Hey Villar...next time I see you; NO SHRIMP FOR YOU! And don't stop for a picture with ZD with your camera posse. I can't be seen in a photo with you, loser.)
Just sit your A.D.D. ass in your chair, in your City Hall office...stop attaching your cart to a losing horse and pissing off the rest of Washington, D.C. And you better hope you gal wins, or I don't think you'll like where the U.S. Attorney goes.
RUMOR PATROL: No, this isn't about a fashion designing mayor appointee...here's a comment that almost went un-noticed by ZD:
Anonymous said: Zuma Dogg some lawyers and accountants on the third floor are working on a city personal income tax. February 12, 2008 11:09 AM
Not that ZD is one to jump on a random comment (despite what my critical spinners will try and lead you to believe), however, I was tipped to this, last fall, based on some memos someone sent me, that predicted this was still yet to come -- so this comment is probably in response to this post. SO TO CLARIFY...With Villaraigosa facing a $600-$700 budget deficit, even with Prop S money -- and dropping property values, means less property taxes for the City -- they are going to have to come up with new and creative revenue streams, like a City Personal Income Tax. (Why not just make a blanket tax where the City will allow you to keep 20% of your money, and they take the rest.)
CAPTAIN JACK MESSAGE IN A BOTTLE: Since Cpt Jack tipped ZD's ski cap to this "personal income tax", along with Mayor Sam who also blogged about this, here's an update he just posted with some other new and creative revenue streams on the way:
Captain Jack Sparrow said, "As we understand it, the prevailing sentiment amongst the sots is that since two (puts up two fingers) tax measures have been whisked onto the ballot and handily approved by a rather stupid public-at-large, why not ram as many possible taxes through as one can before someone's good will and another someone's political connections finally run out. Expect to see many new and unusual taxes such as a public school student tax (i.e., if your child attends LAUSD, you pay a head tax), a tax on your overdue library materials fine, a tax on getting a license for your pooch (and soon your pussy) and others to spring forth from that brain trust known as the Clowncil, savvy?
New Density Incentive That Is A Virtual Zoning Change On Coucil Agenda For Wednesday & Is Villaraigosa Creating New City Income Tax?
NEW DENSITY INCENTIVE ON LA CITY COUNCIL AGENDA FOR WED 2/13/08: It's the beginning of the end. (See "Escape from New York") It's a long-ass, shady as hell new ordinance on the LA City Council agenda today. Looks like a GREAT day to be a developer with all the right connections with LAANE/CRA/Villaraigosa and his connected cohorts in the high density housing business.
It'll take a minute to type up a comedy review exposing all the shady angles, but basically, if you agree to add 10% affordable housing; a developer can increase density by 20% on your project. 20% affordable housing=35% added density "bonus" (incentive).
PLUS, the developers can now get more State and Federal grant money for these projects. And I'll re-post the threads from last summer about "there is a lot of profit to be made in the non-profit, affordable housing racket.)
Click here for today's agenda item on "density bonus" that will bring the city to a grinding halt, and create so much over crowdedness that crime is certain to skyrocket.
And oh yeah, are you adding 35% more roads, police, fire, trash collection AND WATER!!! THERE IS NOT ENOUGH WATER TO ACCOMMODATE ALL OF THIS ADDED DENSITY -- AND YOU KNOW THIS. AND YOU WILL NEED WATER TO COOL YOU OFF BASED ON WHERE YOU ARE ALL HEADED FOR THIS. Besides the infrastructure -- THIS WILL CAUSE A SERIOUS WATER PROBLEM!!! WARNING...WARNING...THIS IS NOT A TEST!!!
FEATURED COMMENT: LA'S undisputed greatest guitarist Matt Dowd said, "this one has Eli Broad written all over it. Add 20% affordable, get 35% density bonus, AND GET SUBSIDISED TOO!!!!" (Matt tipped ZD to this item and did the initial legalese analysis.)
HILLARY CLINTON: Billary should step out of the way of the Democratic nomination and step down like Romney and Edwards did. With McCain now the virtual nominee, the Democrats need to move forward, and all Clinton is going to do by hanging around is divide the party. If she cares about the country, she should do what's best for the party, and step down and let the nominees get started.
click here for zd updates throughout the day and night. shadiness never sleeps, so I can't either!
Treasury Dept & HUD To Suspend Foreclosures for 30 Days, Villar Admits To Tough Budget Year, and Nunez To Get Out of Politics
WARREN BUFFETT: Buffet called into CNBC this morning to announce that he is offering $800 billion to re-insure municipal bond portfolios. (Hey Antonio...CALL NOW!) Good short-term news, although this is still only a drop in the overall bucket. And he's only going to be insuring the low-risk part of the problem. (And that's not the problem!) Read below, and hopefully this move can help prevent the scenario. One of the three insurers he made the offer to already declined.)
TREASURY DEPT & HUD TO HELP PREVENT FORECLOSURES: Lenders offer broader mortgage plan, extends to borrowers of all loans, not just subprime. The plan will allow seriously overdue homeowners to suspend foreclosures for 30 days while lenders try to work out more affordable loans, according to AP
. The plan, called Project Lifeline, will be announced Tuesday by the Treasury Department and the Department of Housing and Urban Development, said a person familiar with the plan who confirmed earlier news reports about the plan but spoke on condition of anonymity because it had not yet been made public.
2/12/08 UPDATE: Plus, Villaraigosa admits to tough budget year ahead, even with Prop S money. (ZD says deficit is FAR WORSE than they have copped to...$600-$700 million...NOT just $200-$300 million.) Nucklehead Nunez admits he's out of politics, for now (as if he had a choice). And Clinton insiders admit Ohio & Texas are both "must wins" as Clinton donors fear campaign is slipping away. (Tuesday ain't gonna be a day for Schillary.) But there's no need to fear...Trujillo is on the case in Texas! (Hold on to your water bottles!) And Mt. Gleason/LAUSD crew...best get your shiz together pronto...ZD's putting the smack down, on the realest. Laugh now Irma Good and Deborah "I have friends in very high places" Costa. The community will be having the last laugh. It's over...and so is your LAUSD career. Mark this date!Click here for these updates.
Buffett Offers Muni-Bond Insurer "Safety Net", Paulson Announces Homeowners Assistance Plan & GOLD ALERT!!!
IMPORTANT GOLD ALERT FOR 2/12/08 AT STRATEGYUPDATE.COM (This blog's companion web site with updates posted between blog updates.)
GOLD WATCH: Something I've noticed..."Smart Money" (hedge funds/big boys) seems to own Yamana Gold (AUY) more than almost any other gold miner. Here's why I came to the conclusion. When gold is up, or in rally mode...I've noticed AUY is the first gold mining stock to start to go south, when gold prices start to drop. AUY is not necessarily to first to rise back up, when gold prices rally back (however if you do see it rally first, expect the rest to follow), but you can use this "down" indicator to help you be on guard for gold to drop, if you are planning on selling -- or allow you to be ready to buy if you want to buy on the dips.
DOW RALLY (DO NOT BE BAMBOOZLED!): Don't be fooled by the warm and fuzzy feeling that causes Wall Street rallies over these press release announcements like Buffet's $800 billion offer to re-insure municipal bond insurers, as a safety net if they want it. (And one of three insurers Buffett made the offer to already turned down the offer.)
Problem with this nice gesture, is these muni bonds aren't the root of the problem that looms ahead. These are the low risk bonds. However, if they ever get threatened that they are about to lose a "AAA" rating, they can fall back on this offer to avoid the sell off that would occur on a downgrade.
And Paulson announced that the Treasury Department and HUD are going to help keep people in their homes with a new warm and fuzzy, fluff-ball plan that won't make a dent in the subprime problem.
However, Wall Street psychology is a factor, and these announcements will falsely remove some of the fear that has been casting a gloom on the market, and we'll see a short term rally. The Fed, White House, Buffett and everyone else can try as they will to keep the market propped up, and the economic factors in check, but there's no way to artificially keep things propped up in the long run. We're talking stuff of historic proportions ahead.
Please beware -- the credit derivatives market is the big problem here: The spreads are getting wider -- and the problem is bigger (and getting bigger by the day) than the financial institutions have accounted for.
Plus, like subprime affected the housing market, get ready for the same thing to hit the car dealers/auto industry -- and watch for credit card companies to start seeing much later payments, and complete defaults. And as people's homes continue to drop in value, and they end up owing more on the property than it is worth, more and more people will be walking away from the payments and stiffing the banks.
So enjoy any short term rally this month. We think it will be time for a chorus of "Hell's Bells" sometime soon. (Like this month.)
Click here for updates throughout the day, between these daily blog posts, at StrategyUpdate.com. (Investors resource site with news links and 24 live gold, euro and metals charts.) Already posted everything on this blog last night and early this morning. Set a Google Alert for "strategyupdate.com" so these blog alerts will be sent to your email inbox, right away.
Wall Street Alert: Watch This Video of the Week (Based on Bond Insurance Crisis)
StrategyUpdate.com blogger Zuma Dogg sings a little song to indicate where he thinks the stock market will be going based on the credit derivatives market and bond insurers' crisis. We've been posting doomsday alerts since October of '07, predicting a historic downturn as soon as the calendar turned to January '08, that would be the small wave, before a second downturn in February, worse than the historic losses in January. Don't think the bail out express will be here in time. And when it does get here, won't be able to help in the long run. The biggest to be hit are Municipal Bonds -- like the one's the City's and State's sell to the people. WATCH THE CREDIT SPREADS IN THE DERIVATIVES MARKET...That is why this is our video of the month.
strategyupdate.com 24 hour gold and metals charts and links to all the newswires and charts. Plus pre-market predictions.
Here are some stories from the overnight news wires to be aware of for Monday:
METALS ARE UP AGAIN IN OVERNIGHT TRADING: Gold gets all the attention, but Platinum and Palladium are outperforming those metals due to Plat & Pall production outages and now shortages. See list and analysis below, and check the 24 hour LIVE charts at strategyupdate.com
PAL IS UNSTOPPABLE! VGZ has been a tippy-top performer, lately, on days that gold is up. Check it out! (10AM UPDATE: PAL was up nearly 10%, grossly outperforming other metal stocks, and the rest of the stock market -- before metal prices started going down in the 10 AM hour. When metals rise again, expect it to be led by PAL, which may rise 10%-12% at that time.
KRY: They released some news at 9:19am, right after pre-market trading closed. Hmmm. Let's see how this (good) news drives this $1.80 a share gold mining stock.
(Be aware of automatic profit taking by major hedge funds when gold hits record levels. But if the trend is up, it will only be a temporary dip. You can take your chances that we will see that dip, but read the analysis below.)
2/11/08 GOLD ALERT:
Platinum price hits record high amid S.Africa power crisis
Angloplat earnings fall, power cuts to hit output
Newmont predicts all major gold miners will see production decline
Newmont forecasts higher costs
Oil climbs $92 on Venezuela threat
U.S. light crude for March delivery rose as high as $92.71 a barrel in early trade, matching its recent January 30 peak, the highest point since January 15.
Platinum hits record high on supply concerns
SINGAPORE (Reuters) - Platinum hit another record high on Monday on the back of lingering supply concerns in South Africa, which produces four-fifths of the world's metal. Spot platinum
Venezuela threatens to stop US oil sales over Exxon
CARACAS (Reuters) - President Hugo Chavez on Sunday threatened to stop sending oil to the United States unless it halted an "economic war" that he said included an Exxon Mobil lawsuit freezing $12 billion in Venezuelan assets.
Goldman Sachs boosts wheat price forecast
SYDNEY (Reuters) - Investment bank Goldman Sachs (GS.N: Quote, Profile, Research) has raised its outlook for Chicago wheat futures by 47 percent to $13.50 a bushel after the U.S. Department of Agriculture cut projected 2007/08 U.S. wheat ending stocks.
The Goldman Sachs three-month and six-month price forecast compares with CBOT March soft red winter wheat WH8 futures closing price on Friday of $10.93 a bushel, after prices again rose by their 30-cent daily limit.
Record high wheat prices were sparked on Friday by new world agriculture supply and demand estimates by the USDA, which cut projected U.S. wheat stocks at the end of the 2007/08 marketing year on May 31 to 272 million bushels from its estimate of 292 million bushels in January.
This is the lowest levels of stocks since 1947/48, Goldman Sachs said in its Commodities Watch report, issued on Friday.
Acute world wheat shortages, after crop problems in both the northern and southern hemispheres and strong export demand, have sparked wheat price rises on U.S. futures exchanges by the daily 30-cent ceiling for most of the past three weeks, causing the exchanges to raise the limit from February 12.
Reuters reports that Australia's Central Bank Warns of More Rate Rises: Australia's central bank bluntly warned on Monday that it would likely need to raise interest rates again to restrain inflation, even as it trimmed its outlook for economic growth.
The unusually explicit warning from the Reserve Bank of Australia (RBA) lifted the local dollar above 90 U.S. cents while bills futures slid as the market priced in a greater risk of a further rate hike, perhaps as soon as March.
STOCK MARKET UPDATE: Experts are saying it's time to jump on the financial stocks, since they have been beat up so much. Batcomputer says, you will have a chance to buy the financial sector at lower prices than they are currently at. (And that's an understatement.) Batcomputer is very, very nervous that there will be a big bottom in the low 11,000's (or high 10,000's), before a big rally back to the 13,500 range. Look how the market has tanked in January, then again last week. But long term (2-3 years), you should be o.k. if you wanna take your chances on financials. Although the Batcomputer wouldn't. It's just not worth the risk since the dust hasn't settled yet. And we say there will be a lot more dust. Interested in gold in '08? See our update, including watchlist of picks. Wall Street updates throughout the day at strategyupdate.com.
2/11/08 Pre-Bell Update: Yahoo boardmembers to reject Microsoft's takeover bid feeling the offer is to low and wants $40 per share. (LOL!) Batcomputer says,
Experts are saying it's time to jump on the financial stocks, since they have been beat up so much. Batcomputer says, you will have a chance to buy the financial sector at lower prices than they are currently at. (And that's an understatement.) Batcomputer is very, very nervous that there will be a big bottom in the low 11,000's (or high 10,000's), before a big rally back to the 13,500 range. Look how the market has tanked in January, then again last week. But long term (2-3 years), you should be o.k. if you wanna take your chances on financials. Although the Batcomputer wouldn't. It's just not worth the risk since the dust hasn't settled yet. And we say there will be a lot more dust. Interested in gold in '08? See our update, including watchlist of picks. Wall Street updates throughout the day at strategyupdate.com and do a Google alert for "strategyupdate.com" to receive blog reports.
IT GOLD ABOUT TO REALLY TAKE OFF?: Oil prices rising, inflation already rising (see commodity prices) and more Fed funds rate cuts expected...Gold miners are yet to catch up with gold's recent rise, proportionately. But of course gold itself is going to be safer than any one mining pick. It depends on what you are looking for in an investment. But although you always see gold and metals take some hard falls (especially at record high levels, that we are approaching again, as hedge funds take their automatic profits) -- if last week was any indication...gold is not only holding it's own in this volatile market...but could start to speed up it's gains, and reduce the sell offs this week.
Usually, I would be too nervous to buy metals after this big run-up this past week (because you can see some painful drops). But on Monday February 11, 2008...I think time will show today is about as good as you are going to do in the long run, when it comes to gold. (Unless you have the cajones to hang in there for one more "profit-taking dip" we usually see at these record levels. The last hedge fund sell off was at $836/oz. So you still have another $10 rise on gold before you have to worry about it.)
And the Batcomputer says that by that time, inflation fears, a weaker dollar, and higher oil prices may offset any major dips on it's way to $950-$1000. Gold is now the third currency and if the stock market runs into a "rough patch" over credit derivative/subprime/bond insurer crisis -- people will be pulling out of stocks -- and jumping into gold. (It would have been nicer to jump in at $800. But people always say, "Too late now" -- and then they look back and say, "Damn, I liked gold at $920!" (See Gold Update for list of miners and more on gold investing stategy.")
AND WE CALLED PAL ON FRIDAY: We predicted metals would be up led by Palladium. Sure enough, metals were up, led by Palladium. And our Palladium pick (PAL), closed at $5.60 -- up 12.45% for the day! PAL was at $3.59 on 1/23/08. (Better than gold!)
METAL STOCKS ARE STOCKS, NOT THE COMMODITY ITSELF: And since these are stocks, they sell off, too when the market takes a dive.. But long run, when/if the stock markets go REALLY south, due to economic problems, gold will rise without the DOW-based sell-offs. AND, as the DOW goes down...gold and gold miners stock will/do not go down as much as general stocks, so you still win. (That's the point!)
So in other words, on some of these down 200-300 point days, your gold miner may only drop 2%-3%, when everything else in the market is down 7%-9%. And this past week, dropping -123 point, followed by -370 points -- it closed Friday down another -63 points. While gold had it's best day all month. Read the writing on the wall, y'all!
PROFIT TAKING FEARS: With gold this high, assuming you will see profit taking drive the price down. What do you do when it looks as though it's only going up? I would buy it like crazy on Monday in pre-market hours if the Batcomputer is giving the "buy" sign at 7:00am EST on Monday 2/11/08. (However, there is a lot of volatility with the Euro and metals in overnight trading, so you may want to watch to see which way the wind blows before you buy right before a dip today.)
UPDATES THROUGHOUT THE DAY AT STRATEGYUPDATE.COM. (Plus 24 hour LIVE gold, metals and euro charts.)
When It Comes To Gold, The Signs Are Always Clear...You Just Have To Monitor Things
24 Hours A Day
by Strategy Update
Click here for new article on gold trading, including some safe picks for investing ("buy and hold") and some short-run picks if you like to trade.
Plus, overall market update at StrategyUpdate.com
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