Monday, March 24, 2014

A viewpoint on Gilead


Tuesday, March 4, 2014

Will the real Russia Stand Up

The market close for March 4, 2014

S&P 500 up 1.53% Gold -$2.00

Oil -$.08 T-Bond -.093 Basis Points

Dan's new book available at

Sunday, March 2, 2014

It is just after 10 O’clock Sunday night and there is a clear pattern in the markets. Lets look at our three indicators.

The S&P 500 is off 16 points less than 1%
The price of oil is up about $1.20 or a little less that 1.2%.
Gold is up $22.00 just over 1.8%
The yield on the 10-year T Bonds is off about 4 basis points or around 1%

At least for now the US markets don’t seem to be to concerned about what is happening in the Ukraine and Russia. Our President suggested over the weekend that any invasion by Russia into the Ukraine could be a cause for economic sanctions by the west. The real question is will Vladimir Putin withdraw his troops? I think that he is testing the west to see if they are like the west before World War II in the period of appeasement with Hitler.

Does the west have the courage to stand up to Mother Russia or will they, in order to avoid a major conflict, let Putin have the Ukraine? If they do then Putin will be embolden to tray and take other land. How will President Obama react to Putin’s aggression? Will he want to lead from behind and let other leaders try and solve the problem?

What is the message that Secretary of State Kerry is carrying to the leadership in the Ukraine?

All of these questions are important, for now, things are a little messy but potentially manageable. However, if things escalate and no progress is made I would expect the markets to start getting worried. 

What should we look for:

I think two things to watch are the price of gold and the yield on the 10-year T Bond. If thinks start to get more difficult money will want to move to a safe have and that is primarily US Governments and in particular the 10-year, current yield 2.61%. Gold stands at $1,343 an ounce. Gold could run to $1,400 and the yield on the 10-year could break below 2.50. In a bad outcome the yield on the 10-year could test 2%.

The longer we go without a resolution the more challenged the markets will be. One last thought see if the Russians are still in the Ukraine at the time the G-8 ministers are supposed to meet in Russia. Look for a call to not attend the G8 meeting.

We have cash and the SDS to give us some downside protection if the stock markets fall apart. Watch for blog and e-mail updates.