Brinker comments summarized, paraphrased or excerpted:
OSAMA BIN LADEN IS AS DEAD AS A DOORKNOB....Brinker said: "This is the week that we can finally say that we will not be dealing anymore with Osama Bin Laden. He was taken out by United States Special Forces, the brilliant work of the Navy Seals in an operation last Sunday, which was reported after the broadcast.....We congratulate everyone involved in that operation, from President Obama, all the way down to every single Navy Seal involved in that operation. They deserve the kudos that they receive."
STOCK MARKET... Brinker's Ground Hog Day report again -- closing numbers and year-to-date returns again.
Honey EC: There has been no change in Brinker's bullish outlook on the stock market, and his model portfolios are still fully invested. In the May 2011 issue of Marketimer, he is still forecasting the S&P 500 Index will reach the "low-to-mid 1400's range over the next 12 months."
TREASURY RATES....Another Brinker Ground Hog's Day report....rates are very low -- about as close to zero as possible, especially after taxes.
TREASURY IMPLIED INFLATION RATE....Annual: 2.5%. Brinker explained that this is not his inflation rate forecast because he doesn't have one. It is the Treasury market's implied inflation rate.
LEADING ECONOMIC INDEX.... Coming out on Thursday this week....Looking for a little uptick, following a good trend.
CONSUMER PRICE INDEX....Last week = 2.7 headline number; 1.2 core number (year-over-year); one month core number= 1/10th of 1%. Fed wants to see core inflation at no more than 2%.
KEY TO INFLATION.... Brinker said: "Obviously, labor costs are the key to inflation. Some people get it wrong on this and they think commodities are the key to inflation. Commodities are not the key to inflation, believe me. The key to inflation is the cost of labor and that's why inflation is so very, very low."
CALIFORNIA CAPITAL GAINS TAX....Top rate almost 10%, which is added on to the Federal 15% rate -- totaling a whopping 25%!!!!!
NEXT FOMC MEETING....Will be reconvened June 21st and 22nd -- ".....presided over by Obi Wan Big Ben Bernanke."
WHAT WOULD CAUSE INTEREST RATES TO GO HIGHER? Brinker said: "My guess is, that in order to get materially higher rates, you need a faster rate of economic growth.
HOUSING MARKET.... The market is looking to stabilize, but kind of going nowhere. Housing starts are expected to have a little rebound for the month, but according to Brinker, that is no big deal. Existing homes figures coming out Wednesday -- expected to sell at an annual rate of about 5 million....About 90% of housing transactions are existing properties...
Honey EC: While talking about the housing market, Brinker took another swipe at caller-Sue, who was on the April 17th program. She told Brinker that she was for a "Fair Tax." On today's program, Brinker said she called it a "Flat Tax." She did not. She denied that it was a "flat tax," and Brinker contradicted her vehemently. Here are my comments about their conversation:
NEW JOBS....Brinker said: "Here in the first four months of 2011, we have added an average monthly 192,000 new jobs. But it's better than that because the last three months, we've averaged over 200,000 new jobs in each of those months. It's nice to see people get those opportunities, but it's still rough out there because the unemployment rate is 9%. Way too high."Caller Sue from Cape Coral tried to explain to Brinker that the Fair Tax is not a “flat tax.” He clearly did not want to listen to Sue's explanation and repeatedly interrupted her. Later he talked to another caller about what Sue had said.
WAGES AND WORK WEEK.....Brinker said: "As far as wages are concerned, they are really quiet. We saw 3-cent increase in the average hourly wage....That numbers in the area of $23 an hour. And the average work week was unchanged, sitting in at 34.3 hours per week.....So people are not being asked to work longer work weeks at this juncture."
UNEMPLOYMENT REPORT.....Brinker said: "It was a good one. We like employment reports that are spritely, and this one was definitely in that category, 244,000 new jobs added in April.....In the month of April private sector jobs growth 268,000, then subtract another 24,000 government jobs -- gone, goodbye.....slashing budgets, money's not there....We had to wait awhile for this jobs growth, but we have it, at least for now in the data."
WHAT TWO STATES THAT HAVE NO TAX ON EARNED INCOME, BUT LEVY A TAX ON UNEARNED INCOME? Brinker suggested that this may be a question on the Moneytalk final exam. Answer: Tennessee and New Hampshire.
WHAT SEVEN STATES HAVE NO STATE INCOME TAX AT ALL? Answer: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming.
BRINKER'S EUROS DOING WELL....Brinker said: "Well, I have some Euros that I purchased from my last trip over there. I had a little chat with the spouse what to do with these things. There's no way you can trade these things back in because after you pay the vigorish to go from one currency to the other, and then you go back again -- whoa, I mean forgeddaboutit. So I put them on the shelf and the darn things are up 20%."
Honey EC: Brinker's guest-speaker today was Dan Dicker. The subject, oil and commodities, seemed much more current than the usual Brinker guest-speakers who re-hash the financial crises of 2008. Later this week, I will write a summary of the third hour Dan Dicker interview. You may want to download it from KGO (see the link below).
(The Kindle edition of this book is available at $16.99.)
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Moneytalk on demand and to go with Bob Brinker, is available for audio/podcasting FREE at KGO810 radio for seven days after broadcast. The program is archived in the 1-4pm time-slots. I download and save all three hours, including the third hour guest-speaker. KGO Radio Sunday Archives
Dixiegeezer's beautiful Dragonfly on a water lily (click to enlarge).
24 comments:
Ms Honey said that bob is working again today..........
Would it be rude to brinker if I asked, "Who Cares"?
If so, I will come back and aks (sic) the question.
signed AnonymousPig
Apparently potions of all it are old calls cobbled together.
tfb
Mr Pig, Mr Pig,
You have to care, otherwise I'm going to be out of a job here. I may even qualify for a raise soon. Let's see, what would a 5% raise from zero be?
LOL!
.
TFB,
I was having dinner with family and missed the first two hours of the program. Are you saying that it was old spliced calls?
.
HAPPY MOTHERS DAY
to Honeybee and all other mothers, queens of their hives!
TFB
I don't think it was "old calls cobbled together". Some of Bob Brinkers answers are repeats. Like the one he gave to caller Diane in Folsom. She wanted to pay down on her mortgage and he said the bank would send a limo to pick her up. I have heard him say this to most of the caller who ask that question.
Brinker was definitely "Live" today. Topic covered were Bin Laden, Silver, and the current level of the market.
On last week's thread Honey provided a link to Bob Brinker Jr's twitter account and I was quite perplexed when reading his entry from May 5
$AGQ all getout quickly
Could he be referring to a leveraged silver trade? Why is a fixed income advisor discussing a
2X commodity ETF? Then it made perfect sense. Given the fact that during Apr 27-29 AGQ traded north of $350, only a Brinker would recommend selling an asset after a 40%+ decline.
Papa must be proud.
"Given the fact that during Apr 27-29 AGQ traded north of $350, only a Brinker would recommend selling an asset after a 40%+ decline."
LOL. Did he tweet to "hold for future recovery" yet?
Bob Twit
Birdbrain, with his keen eagle-eyes, said: "On last week's thread Honey provided a link to Bob Brinker Jr's twitter account and I was quite perplexed when reading his entry from May 5
$AGQ all getout quickly
Could he be referring to a leveraged silver trade? Why is a fixed income advisor discussing a
2X commodity ETF? Then it made perfect sense. Given the fact that during Apr 27-29 AGQ traded north of $350, only a Brinker would recommend selling an asset after a 40%+ decline."
Yes Birdbrain, AGQ is a exactly what you said it is -- 2X leveraged silver ETF.
I checked this morning and he hasn't given any follow up advice. And no one should hold their breath for him to ever mention AGQ again. LOL!
May 5th, the day he said to "get out quickly," silver closed at $179. Right now, AGQ is trading at $209.
Here's the link again: BobBrinker Bob Brinker
$AGQ all getout quickly
5 May Favorite Retweet Reply
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Bob Twit said: "LOL. Did he tweet to "hold for future recovery" yet?"
I think Birdbrain's point about this second Fixed-income Bob Brinker giving advice by the seat of his pants to 3000 Twitter followers, is a good one.
This Bob Brinker doesn't like me at all. He's made that abundantly clear, at least twice that I know of:
1. He selected me out of (at the time it was) 1200 followers to Block from being one of his "followers" on Twitter.
2. I tried to subscribe to his fixed income advisor, paid by credit card and he refused it.
Wonder why? LOL!
PS, Being blocked from someone's Twitter account doesn't mean you can't read their Twits. It means that what they write doesn't show up on your own Twitter and you cannot "Re-tweet" what they write to all of your own followers.
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Lacking the patience to read BB2's earlier twitter entries I wonder when he first mentioned AGQ.
Could it be that he followed this blog and, filled with envy reading of Honey's success with this ETF, attempted to ride her coattails and impress his followers?
Take a bow, Ms Bee. You have more influence than you realize.
Birdbrain,
Thank you... :)
.
Regarding precious metals, and silver in particular, only time will tell where they are going. But a little bit of distance and some old-fashioned common sense might be in order right now. This makes sense to me. Others may disagree:
Silver's Dip will be Brief!
(Silver prices are in an anti-bubble!)
Silver Stock Report
by Jason Hommel, May 5th, 2011 Grass Valley, CA
Silver dipped below $36/oz. this morning, down about 8% from yesterday, and down about 27% from the high last week of about $49.50/ per troy ounce. (A Troy oz. is about 10% heavier than a the more common international avoirdupois ounce.)
Some people are saying "this is like 1980 all over again" and that silver will now crash. Nothing could be further than the truth.
The truth is that the amount of money they have printed up since 1980 is ten times higher, so if you adjust for inflation, the peak price from 1980 should be more like $500/oz. in today's dollars.
The next key difference is that in 1980, interest rates, the amount paid on bonds, rose to over 20% per year. Today, interest rates are close to zero. Interest rates make holding bonds more attractive.
The next thing is that the US government money printing driven inflation is just beginning, it's not remotely close to ending. The US annual budget is about $3.8 trillion, and the government collects about $2.2 trillion, leaving a gap of about $1.6 trillion that is met by money printing, which makes the value of the dollar go down.
$1.6 trillion of new money can also expressed as $1600 billion, or $1,600,000 million.
For comparison's sake, new investment demand for physical silver last year was only 250 million ounces, at, let's say an average of $35/oz., was just under $9 billion, or only $9000 million.
Silver is not in a bubble in terms of prices.
The bubble in stocks in 1929 was caused by debt financing.
The bubble in housing in 2007 was caused by debt financing.
You cannot borrow money to buy silver. Thus, silver is NOT in a bubble.
Exceptions: Yes, you can borrow money to speculate in silver, but no silver is ever purchased at the time that you purchase futures, or options on silver. And the futures market is known for having an overall open interest of over 800 million oz. of silver, while less than 40 million oz. of silver are available for delivery!
Yes, also certain private firms, who have horrible reputations in my opinion, will let you borrow money "to buy silver", but you must keep the silver with them, and it's doubtful that they ever actually purchase the real silver either.
In silver's case, the availability of debt, and use of leverage is used to prevent you, distract you, dissuade you, from actually buying silver. This makes silver an "anti-bubble"; the opposite of a bubble.
This article claims that silver was worth about $1218/oz. in the Ancient Roman World!
http://networkedblogs.com/hojgP
One article last week noted that "8 years of global Silver supply changed hands last week". He could not calculate how much silver traded hands in the OTC or "over the counter" markets that are unreported and unregulated, which are typically 20 times larger than the visible markets like the COMEX and the ETFs.
That article shows that the amount of paper trading of silver has recently grown to perhaps 1000 times larger than the real silver market.
At last week's rate of about one year of global silver supply traded in a day, with 250 trading days in a year, suggests 250 times as much paper silver trading than real silver, but that's not counting the much larger OTC markets.
Continued next post....
Continued from above:
Again, with all the flurry of news articles on silver this last month, nobody has mentioned the BIS report that I've highlighted for the past 1-2 years that shows that world banks have liabilities (that's debts) in "other precious metals" (mostly silver) of anywhere from $100 to $200 billion, and that was way back when silver was $20/oz. That's about 15 years of annual world production, with swings into and out of the banking system of 8 years of annual production in less than 6 months.
Thus, mostly all of the silver in all major LBMA banks in the world is thus likely fake silver, all fraudulent paper silver, nothing is real there. I would love to know how much real silver they do have, as obviously, they have to have at least some silver to function with their "fractional reserve silver banking" that they do.
Thus if a bank holds your silver, I'm 99% certain that they don't physically hold YOUR silver for you, and that you know nothing about the real fundamentals of the silver market.
When you read that an commentator or analyst is "long SLV" you can know for certain that that commentator knows almost nothing about the silver market.
When debt is used to actually buy real silver, the extra buying would artificially push the price up.
When banks actually owe silver that they neglected to actually purchase, their lack of buying artificially pushes the price down.
Again, silver is the opposite of a bubble.
People have not yet learned that silver is payment in full. Silver is not a promise to be paid. Owning a promise to be paid in silver is about as bad as owning paper dollars -- the value of both of which has (primarily and fundamentally) only one way to go, which is down.
Government is in a bubble. US paper money is in a bubble. The US bond market remains in a bubble.
Somebody just posted to my facebook, "everybody is selling out", "Soros is selling his gold", etc.
No, the opposite is true. Nobody was ever in.
The real fundamentals of silver show that less than 6% of 1% of paper money in the USA even bought any real silver last year.
That means that silver buying would have to be 20 times more, just to get to about 1% of people buying silver!
Silver the opposite of a bubble. This dip will be brief. Silver at $200/oz. is still a "price dip" compared to where the silver price is headed.
Silverstockreport
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Another POV says smart money leaving silver.
Smart money left silver to tarnish retail buyers
Hedge funds, other large players cooled speculative bets before metal’s crash
SAN FRANCISCO (MarketWatch) — Retail buyers may have stayed invested in silver long after most hedge funds and other large investors had left, data from U.S. futures regulators suggest.
Data from the U.S. Commodity Futures Trading Commission shows money managers’ bets that silver prices would go higher declined starting mid- February, when silver prices started to climb in earnest following a lull in late January.
The trend suggests the so-called ’smart money,’ the large managed funds that report to the CFTC, had started to back away from silver and “retail investors picked up the slack,” said Tom Pawlicki, a precious metals analyst with MF Global in Chicago.
The CFTC data for gold, in contrast, show steady support from money managers in the run-up to this week’s drop.
http://www.marketwatch.com/story/funds-had-left-bets-silver-was-going-up-2011-05-06
AML
I wonder if anyone is familiar with the Double Line Total Return Fund (DLTNX).
It's a very new fund, just started a year ago.
It's an "income fund" paying about 7.8%, and has a 0.74% yearly expense rate.
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DLTNX is great if you like Fannie Mae CMOs
Tuesday, February 22, 2011
Jeff Gundlach's S&P, Muni, TNX and Home Price Targets (DLTNX, DBLTX)
Jeff Gundlach, CEO of DoubleLine Capital LP (adviser to the DoubleLine Funds), was Barron's cover story this week.
His DoubleLine Total Return Bond Fund (DLTNX/DBLTX) is up 17.36% since it launched in April 2010, outperforming competitors. He made interesting calls in the Barron's article.
In summary, Gundlach thinks the S&P "will hit 500 in the next couple of years", "expects home prices to fall by another 10% to 15%", and if there are muni defaults "there will be a panic at the margin, and muni bonds from the highest-rated on down will plummet". He's setting up a fund to scoop up distressed municipal bond funds at "40% of NAV". I wonder if Kyle Bass is doing the same. I'm going to check what muni-bond funds and ETFs own.
Regarding Treasuries, Gundlach said, "a renewed slowdown in the economy would drive 10-year bond yields sharply lower, but not below 3%, unless a banking panic similar to last year's euro-zone crisis ensues. Here is a link to Gundlach's January report.
AML
Here's part of the February, 2011 Barron's article that AML referred to about Jeff Gundlach, the supposed bond guru. He doesn't think much of himself, does he?
"
Celebrated bond-fund manager Jeffrey Gundlach has a healthy -- some might say overdeveloped -- ego.
In the course of several interviews at the Los Angeles headquarters of his new investment firm, DoubleLine Capital, Gundlach drops any number of boasts. He can do the Sunday New York Times crossword puzzle in a half-hour. On a good day, make it 20 minutes. Gundlach, 51 years old, was a top student at Dartmouth, where he majored in mathematics and philosophy before entering a high-powered Ph.D. program in mathematics at Yale. He left, claiming boredom, to become a rock drummer in L.A., before drifting into money management.
"Look, I have a gift, or some would say a curse, of being able to have stunning insight into the reality of markets and the economy," Gundlach says, dressed resplendently at this particular moment in a well-tailored Italian suit with matching green tie and pocket square. "I don't often know where my ideas come from. Maybe it's the fact that I'm obsessively regimented in my analysis, borderline autistic. But whether it's bond selection or asset allocation, we can do it better than just about anybody around.
It is easy to dismiss such swagger, but Gundlach has the performance record to back it up. At Trust Company of the West, where he worked for more than 20 years until he was fired in December 2009, his flagship $12 billion TCW Total Return Bond Fund (ticker: TGLMX) finished in the top 2% of all funds invested in intermediate-term bonds for the 10 years that ended just prior to his departure, according to Morningstar. It finished in the top 1% for the five years ended just before that watershed event.
Gundlach's legendary success has continued at DoubleLine, which he founded shortly after leaving TCW. His DoubleLine Total Return Bond Fund (DBLTX), with $4.5 billion of assets as of Jan. 31, outperformed every one of the 91 bond funds in the Morningstar intermediate-bond-fund universe in 2010, despite launching only in April. It notched a total return of 16.6%, compared with returns of 8.36% for the giant Pimco Total Return Fund (PTTAX), run by the redoubtable Bill Gross, and 10.74% for TCW Total Return Bond, now managed by Metropolitan West, an able fixed-income shop acquired by TCW to replace Gundlach and his team.
(SNIP)
EVEN MORE EXTRAORDINARY, Gundlach achieved this record by investing almost exclusively in his specialty, securities backed by home mortgages, during a decade when the mortgage-backed market underwent tectonic shifts, destroying many less able investors. First, plummeting mortgage rates led to waves of refinancings, forcing mortgage-backed holders to reinvest pre-payments at ever lower rates. Then came the housing bust in 2007, and a tsunami of foreclosures and mortgage defaults that continue to this day.
Continued next post.....
Continued from last post:
Gundlach, who had warned of a coming residential-mortgage debacle as early as 2006, including in the pages of Barron's, deftly rode out the storm by switching out of private-market securities and into government-guaranteed agency paper issued by the likes of Fannie Mae and Freddie Mac. More recently he has burnished his results by buying private mortgage debt at fire-sale prices of 60 to 70 cents on the dollar, reaping both rich yields and price appreciation.
Gundlach's performance has been "nothing short of tremendous," says Eric Jacobson, Morningstar's director of fixed-income research. "He has slaughtered the indexes during an extremely difficult time. The only cavil might be that Gundlach is far less diversified across fixed-income sectors than, say, a Bill Gross, who has a mandate to go virtually anywhere, from government bonds and investment-grade corporate debt to sovereign paper and high-yield. So some might argue that any comparison of Gundlach's performance to most other managers is somewhat apples to oranges."
That's baloney, Gundlach and his associates say, maintaining they can replicate most interest-rate and credit risk extant in the bond market in their specialized sector. Gundlach had responsibility for $65 billion of TCW's $110 billion of assets under management, and made many of the security selections and asset allocations in TCW funds invested in all fixed-income sectors. Some even had a mandate to invest in stocks.
Gundlach rarely is shy about offering his opinion on markets. Like most bond honchos, including Gross, a member of the Barron's Roundtable, he seldom likes stocks, which are, after all, bonds' primary rival for investment dollars. "Though I rarely go public with specifics on stocks, I think the Standard & Poor's 500, which is now over 1300, will hit 500 in the next couple of years," he says. "I usually couch my belief by saying merely that 2011 will be a tough year for equities."
Nor has he made a secret of his bearish views on the U.S. economy and the seemingly inexorable rise in government debt. But he sees little chance in the near term of a surge in inflation that would send Treasury-bond yields soaring. A jump in the yield on 10-year bonds to a range of 4% to 4.5% from a current 3.6% would cause economic growth to short-circuit, he says.
Read More
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Ms Honey says, qqqquite factually, "May 5th, the day he said to "get out quickly," silver closed at $179. Right now, AGQ is trading at $209.
Am I reading this right? This guy, who LOST money in his bond funds in an UP year, now gives advice to sell out at the ABSOLUTE LOW?
Is he related to Brinker? (((ROAR)))
What does he know about silver, other than what he reads here?
Is this the same guy that has high risk stock funds in his fixed income portfolio to make it look better right now?
Is this the same guy that had no idea how to run a successful web site, unlike you?
If so, why in the world would anyone follow what this guy says? They would have to be nuts, and looking for a way to LOSE money.
Mr Pig,
The answers to your questions are:
Yes
Yes
Yes
Yes
Yes
Yes
While we know how volatile AGQ is and probably will remain, it is trading at $220 right now.
I think another important question is one that will NEVER be answered: How many of his 3000 followers sold AGQ "quickly" at $179, on his advice, and locked in losses?
.
Sunday, Bob Brinker was aghast when a caller told him that he was short long-term Treasuries.
Jim Rogers weighs in on Commodities and shorting Treasuries:
by Edward McAllister – 1 hr 44 mins ago
NEW YORK (Reuters) – Jim Rogers, the veteran investor and commodity bull, plans to short U.S. Treasuries, maybe today if he "gets around to it" and wants to buy more silver, he told Reuters in an interview.
Rogers, who rose to prominence as co-founder of the former Quantum Fund with billionaire investor George Soros four decades ago, said he expects bond prices to fall and the U.S. dollar to rally when the Federal Reserve halts its government bond buying program at the end of June.
"I'm not short bonds yet but I plan to short bonds -- maybe this afternoon if I get around to it," Rogers told Reuters Insider television on Tuesday.
To see the Reuters Insider interview, click here:http://link.reuters.com/baw49r
The Fed in November launched a second round of purchases of long-term securities, which investors and traders refer to as QE II, pumping $600 billion into the financial system.
Rogers added a cautionary note on bonds, however.
"The problem is that polls show 95 percent of investors are bearish on bonds. One reason that I'm not short on bonds yet is that there are too many bears," he said.
The long-time commodities investor said he was unruffled by last week's commodities rout that knocked 13 percent off oil prices. Silver also fell 25 percent in its biggest correction since prices collapsed in 1980, hit by a succession of margin increases that nearly doubled trading costs. Silver had risen 27 percent in April.
Now he sees a buying opportunity.
"It's not the end of the silver market," he said. "I want to buy more silver."
The price of increasingly scarce commodities like oil and precious metals will be rising for a number of years, Rogers said, regardless of impressive market corrections.
"We are in a bull market that has several years to go. I don't know when it is going to end," Rogers said. "We have virtually no new supply of anything. The world's known reserves of oil continue to decline."
He described the commodity crash as "nothing unusual".
"Corrections happen all the time in markets," he said.
Despite his insistence that he's the worst market timer out there, before last week's plunge Rogers had expressed concern a sudden rise in silver prices could lead to a correction.
But now that silver has fallen back, he is optimistic.
Jim Rogers Interview
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OMG, has Brinker gone nuts in recommending DLTNX? Given what's out there about the manager, sounds like it's a trainwreck waiting to happen. Does anyone else think so?
AB
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