Thursday, January 16, 2014

More Hugh Howey Fan-boy behavior from Me

Well, I've never written fan mail before, and I don't consider this to be that.  But I think Hugh Howey, much to his good fortune, is becoming (if he's not already) the indie-writer model of success that other authors are watching and learning from, as I am watching and learning.

I've never met Hugh, corresponded a tiny bit via Facebook and email, but I don't think he knows who I am.

That's no matter at all.  He's a good writer, a very good writer, and he seems like he's good guy.  And quite clearly a major success.  

I sent him this email after I watched Hugh on a webinar sponsored by Amazon.com promoting its "Amazon Worlds" publishing endeavor.  There's a couple of ideas in it that other writers should find useful.  And it might be mildly entertaining.  It'll only take a minute. Read on.

01/16/2014 

Greetings Hugh,

I was on the Kindle Worlds webinar today and I got a good laugh when you said that after you had published one of your earlier novels (you're first maybe?) you sat around waiting for Oprah to call.

I've been waiting for Oprah for almost a year now.

Before the webinar I read Michael Bunker's blog post "We're Not Competing, Part 2: Even With Ourselves" that you shared on Facebook.  He wrote of the need to publish frequently.  I commented to Michael that my heretofore slug-like publishing pace (one book since last April) has yet to pay off. He, and you, are on to something. 

We all know Oprah is not the key to success.  She is never going to call.  Well, maybe you in 2014, but not any of us authors, like a pre-Wool Hugh Howey, that have yet to achieve any notable success.

On the webinar the host asked you what your single best piece of advice to other writers is and you seemed to reluctantly provide your answer, an answer that all writers should intuitively know: write good books.  

I know the reason I have yet to publish my second book isn't because I don't have one, or because I don't think I'm a good writer, it's because I am waiting (semi-subconsciously) for my first book to become successful.

That's what I call "Waiting for Oprah".  I want someone out there, not my wife or my best friend or my mother, ideally the wealthiest and most influential woman in media, to tell me I'm good.  

Well, that's not going to happen and the strategy isn't working.  I need to write more, and better, and earn the loyalty of the thousands readers I so desire.

And you my friend, you have not only a great talent for writing but also possess seemingly spot-on instincts for independent publishing success.  I'd be a fool to not follow your lead.

Keep up the good work.  You are an inspiration to many.  

Yep.  That's enough ass-kissing for today.

Best regards,

Steve

Wednesday, October 17, 2012

Gold prefers Obama Victory

Gold is worried, and rightly so: Obama might lose.  In the post-debate sprint for attention, bloggers and pundits at media sites large and small declared the winner fueled mainly on personal bias.  While the actual tally if assessed independently is that the debate was a tie it must be acknowledged that you don't get the championship belt with a draw.  You must beat the champ.

Obama's performance in the first debate was so bad that he would have had to work really hard to match it. As a result his performance is being received far more glibly than had he done better the first time out.

But gold has no political bias other than to react to the candidates and the impact their respective policies could have on gold's price.  Gold as a predictor of economic policy is telling us that Romney is the better choice.  If elected he would do a better for the economy, thereby making the need for gold a little less important.

On the other hand gold thinks that four more years of Obama is, well, four more years of Obama.  Since the first debate GLD, the SPDR Gold Trust ETF (NYSE: GLD), slid from an intra-day high $174.07 on October 4 to an intra-day low on October 15 of $167.53, a slide of almost 4%.  Clearly Romney's strong showing and gains in the polls is perceived by gold as a bad thing, if only for gold prices.


GLD is up slightly as of midday today, October 17, but not by much, suggesting that perhaps there was no clear winner of the second debate nor front-runner to win the election.

GLD has had a spectacular run under the Obama administration, rising more than 100% in that time.

Gold's cousin silver has had it rough of late and has experienced much more volatility over the past four years.  It remains however an object of consternation as many silver aficionado's have been predicting it to rise to variously debated forms of historical parity with gold.

What for many is easy to forget, considering that silver at current levels is down 33% from its peak in 2011, is that silver is up almost 200% since Obama was inaugurated.  Silver too, here the iShares Silver Trust ETF (NYSE: SLV) reacted to the debates in kind.


As a precious metals investor I'd root for the guy who was going to screw things up and send gold and silver higher.  As an American I have to vote for the guy who is going to do the best job for our country, economically and otherwise.

Gold and silver seem to be confirming my beliefs.  I hope everyone else takes notes.  As an investor I will be taking precautionary measures, just in case the best man does win.  As an American citizen and voter, I'll just have to accept lower gold prices.




Thursday, October 11, 2012

Does Gold Love Obama?

Gold broke out of a four day slump today, posting gains for the first time since the day after the first Presidential debate.  A not so curious phenomenon for avid gold watchers, but one which begs the question: if Romney wins, will gold fall?



I for one say no.  Maybe in the immediate days following his victory, but ultimately no.  The Libertarians will tell you, there is virtually no difference between the candidates.  I don't agree with that entirely, but when it comes to gold and the things that a president can influence which can affect the price of precious metals, I do not see a great difference.

The Libertarians are right in that regard, but not just because both parties and candidates are equally big government spend-aholics.  It is because the damage has been done and even if Ron Paul was President it would be hard to change. The spending cannot not be rapidly curtailed, especially given the weak economic environment.  The government will continue to spend, the future be damned.

But if Romney continues to do well and maintains a tight race, and heaven forbid he wins (sarcasm), let you gold doubters take heed: this is a buying opportunity.

I think Obama is going to win.  And I know that the spending will continue unabated and probably at a greater pace during his second term.  The man wants us broke. He wants to redistribute our wealth not to our fellow Americans but to the rest of the world, the world he believes we've stolen from in order to achieve American superiority.

And a lot of American citizens agree with Obama.  Foolishly, I might add.  Were it not for the American "Empire" the world would probably be a much worse place. Among those we've "wronged" are some that believe, including Obama's neglected half-brother George, that America and Britain have been helpful.  Many are grateful for the aid provided their cultures and the British and American influences that have helped them reach greater heights than ever before.

But if I were to write this post as a person with no essence of compassion and with a complete self-serving attitude I would say that if Obama and his radical cohorts have their way and our wealth is redistributed to other countries, which we know will never make its way back, then the quality of American life which is already in decline will decline much further.

Socialism has never worked in a closed society.  It is ridiculous to think it will Obama's way.  But the real naivete is the idea that America will not feel the effects of said redistribution and that the living standards of our citizens will not change. For those who proudly claim membership to the 99% and who support such measures I say "Idiots!"  Once again it will be you that feel the pain, not the 1%. The 1% will simply leave the country and live on the island of their choice while you stand in the unemployment line waiting for the next handout that will never come.  Oh, and lest I forget, your beloved Obama (last I read since he became President his net worth has skyrocketed to over $11 million) is a 1%-er and you can be damned sure he'll living large on his private tropical resort once he's done.

My fellow investors, keep a little cash handy.  Gold may dip a further if Romney maintains his current pace.  But pay attention, if gold loves Obama as I suspect it does it will gain quickly if he reestablishes a dominant lead.

I know its too late to nominate a candidate, but perhaps a write-in will do.  At least it will send a message.  Here's my guy, the ultimate American.


Wednesday, October 10, 2012

SPY Tops, SLV Ambles, GSH Spikes

We knew it was going to be fun, and it will continue to be so.  As the world anticipates the big VP debate tomorrow and gears up for Obama's return to the podium and his response to being pummeled in his debate last week the US stock market seems to have reached an intermediate top.

Depending on ones charting preferences it can be argued, as I've illustrated in this chart, that the S&P 500 has already broken below the trend line support.  The long term perspective supports the argument that the market is peaking, although additional upside before the big sell-off is likely.

Barring anything particularly positive and surprising, and especially if the market is disappointed by the election, I think the market is topping.  My long term analysis suggests that it should be at or below the two previous peaks in 2000 and 2007, somewhere in the 1525 range.  The bottom could be quite low, especially if things really unravel.  Based upon the last two sell-offs and what I perceive to be the trend line dating back to 1992 I suggest that bottom would materialize somewhere between 700 and 900.

Of course this is less prediction than observation.  As I've written before I am trying to understand why the market should move higher.

I am long both gold and silver and as written here recently believe gold will trend higher.  Silver should as well, but it is plagued by its industrial uses.  Hence it appears a bit schizophrenic at times.  I am concerned though, for both metals but especially silver, that in the aftermath of the election we will see a sell-off of silver as a risk asset.  If it occurs I think it will be an opportunity to acquire more and set oneself up for potentially significant gains.

Silver, here the iShares Silver Trust (NYSE: SLV), peaked earlier in 2011 than gold but surged in concert with the yellow metal in August 2011.  Silver subsequently got pummeled.  However it has recovered nicely in the past month or two.  I think the bottom for SLV would be back to the previous low, around $26.00 per share.  That is worst case scenario.  I think economic circumstances will worsen especially if the election goes the way I think it will, not necessarily the way I want it to, but both silver and gold will ultimately rise while the equity markets fall.

Finally, my alter-ego Steve Gunn over at www.DividendsandIncomeDaily.com wrote an article yesterday on Chinese railroad operator Guangshen Railway (NYSE: GSH).  It's a good piece, if I do say so myself, which was predicated on the dividend and the need for railways in China, slowdown or not.  The article was written Monday, and although not published until after the close yesterday, I'd like to think it is responsible for the stock being up more than 8% in the last two days.  Anyway, please check out that article and the others written by the very accomplished and good looking Mr. Gunn.

Until next time...

Tuesday, October 9, 2012

Romney Gains, Welch Doubts and Gold Pauses

In the wake of the debate last week Mitt Romney closed the gap with Barack Obama successfully making the election a statistical tie.  While Obama leads by a point on many polls Romney leads on some and the momentum is decidedly in his favor.  The President will need a great performance from Vice President Biden in the upcoming Vice-Presidential Debate against challenger Paul Ryan.

While some pundits offered Wild Joe's experience and Mr. Ryan's likely deference to Biden's seniority as an advantage I think the youngster comes intellectually armed and oratorically dangerous to push Biden back on his heels.  Biden is likely to get ruffled and aggressive and given his recent public gaffe's I suspect this will be a much more entertaining event than even Romney/Obama.

A big benefit to Obama's re-election campaign was last weeks unemployment number.  Roundly criticized as inconsistent with other measures of the economy it was Jack Welch, former GE chief, that made the biggest headlines Friday when he Tweeted that "those Chicago guys" will do anything to swing the campaign. Implying that the numbers were falsified in order to make political gain is a questionable decision, one which could harm Mr. Welch as much as point out the disparity.

Many economists however agreed that the number was odd, given that it did not jive with expectations nor other measures of employment.  The U-6 number, the measure which includes underemployed  part-time and discouraged workers, did not budge.  The headline rate dropped from 8.1% to 7.8%, a big move and the lowest the unemployment rate has been since January 2009 the month Obama took office.  It is suspiciously low and many economists are still analyzing the data to figure it out.

Jack Welch got support this week from Donald Trump and Ken Langone, the Home Depot founder.  Both men agree with Welch.  Good for Welch.  Trump is never one to shy away from publicity and Langone has long been critical of Obama.  Trump was keen to predict that the number will likely be adjusted up, after the election...after Obama wins?  I concur.  Conspiracy or not, the number will be adjusted and the real unemployment rate is higher than 7.8%.

Frankly, 7.8% unemployment sucks anyway.  But it makes a great story for Obama.  Look at me, it took four years, but unemployment is now below where George W. Bush left it.  Poor George.  He'll remain Obama's go-to-excuse even if he wins reelection.

Gold remains muddled in confusion and is likely to remain so until after the election.  After peaking last Thursday at a multi-month high gold (represented by the SPDR Gold Trust ETF (NYSE: GLD) in the chart below) has been sliding back a little.  The previous two similar peaks (February 2012 and November 2011) present a bit of a resistance level, which is cause for concern.  The last time GLD traded meaningfully above these peaks was when it hit its all-time high in August 2011.



I am keeping my eyes on those levels.  Further resistance can trigger a sell-off of a good 10% quite easily.  I do think gold will move higher from here, however, even after a 10% draw-down   And I am in good company as many analysts and pundits are predicting >$2000 gold (I read $2400 by the end of 2013 recently). Volatility will be the key, especially if the economy worsens.  In that circumstance, gold will likely get spanked as a "risk asset" first and then fled to as a "safe haven" second, the net result will be higher prices.  Stay tuned...

Friday, October 5, 2012

The Election, Gold and "The Next Big Thing"

It's funny how some publishers welcome or reject articles.  I wrote a piece yesterday for a financial publisher along the same theme as my post here yesterday although a little less political and more investment oriented.  The editor flat out rejected it and told me to reduce the political rhetoric and focus on the investment impact.  I followed the instruction, loaded the piece with charts and analysis, eliminated the "Obama wants to lose" theory and resubmitted it. It was rejected again, for one because the editor claimed I hadn't made the case as to which candidate would be better for the respective investments, gold (the SPDR Gold Trust ETF GLD and the SPDR S&P 500 Index ETF SPY).

Nevertheless, I did not resubmit the piece.  The editor missed the point.  I don't think it matters much who wins, at least far as investing is concerned.  I think there is a big difference between the two candidates and I do have my preference.  I do not think either candidate is ideal, nor am I a partisan ideologue (if anyone cares I am a registered Republican, once a registered Democrat, with heavy Libertarian leanings that likes to think of himself as an Independent and possibly schizophrenic).

There will be a reaction to the election in the immediate days following.  The last few weeks of the year may be volatile.  But the future has been carved in granite over decades of governmental mismanagement.  For gold anyway, the future is obvious and nearly incontestable.  Many will disagree and get mired in the minutiae, but the fact is that the dollar is in intentional decline as it has been for a very, very long time.  The government will continue to overspend regardless of who wins the election.  The world will continue to slowly diversify away from the use of American currency in reserves and trade.  With a more diverse currency environment ownership of precious metals will become far more necessary.  All arrows point to lower dollar, higher gold prices.

Let me be clear, I am not predicting the end of America, although a catastrophic collapse is certainly possible.  But the world is mutually dependent.  American exceptionalism as it relates to global economic dominance has been in decline for a long time.  This is also indisputable.  What is disputable is the pace of decline and the impact on the domestic economy.

If you are an investor, as I've covered for other publishers, you need to heavily diversify your holdings to emerging markets but to far more places than the BRIC countries (Brazil, Russia, India, China).  The BRICs are are not all following the same path, but the best growth rates are behind some while smaller, lesser accessible countries have their best years ahead.  And thanks to the proliferance of new Emerging and Frontier Market ETFs the individual investor can readily gain exposure to some of the better performing up-and-comers.

I'll close today with one chart:

I drew this chart for that ill-fated article yesterday.  I've been drawing this chart since back when I was predicting a double top, the peaks of March 2000 and October 2007.  This macro-perspective allowed me in 2007 to move to cash and avoid the crash.  Unfortunately I wasn't publishing at the time, but I've been predicting the "Triple Peak" since then, having first written about it in 2010.

In two article written for a financial publisher in Dubai, www.alrroya.com, I asked one main question: what will propel the market not just to match the previous peaks but exceed and stay above them?  Sheer stubbornness on the part of investors and traders can make this happen.  Outside of that and an infinite flood of cheap money, what is the catalyst, the "Next Big Thing" that will make it so?