TAKING SOME PROFITS

We are satisfied with the past two months.....we waited all year for six weeks of a straight up market. The top in bonds is now clearly in.....gold and silver....can be bought back later this winter....$1000-$1,100... after a sell off that will scare most bulls.....will be time to buy again....but not here.

Key variables for the next six months....

1) Profit taking..taxes are lower now than in three months.
2) China's demand for everything surprises to the upside....their stock market is moving higher.
3) Oil.....trending higher and the oil equities are way under owned and mispriced.
4) Housing will get worse before it stabilizes.

Why does the media have the housing story wrong? How can it be free money at 4% to buy homes is not being jumped on....of course employment or lack thereof is key...but more importantly it is sky high property taxes....we observe (not foreclosures or short sales) homes being offered for sale 30% below assessed tax value. In other words the city, county and state budgets are now so upside down they won't acknowledge the truth and that is their budgets are still off by 30% or more....and raising taxes is the opposite of what needs to be done.....only lowering taxes is going to stabilize the housing market. Anything else you read is simply spin....AND WRONG.

The elections will as they always do prove the media wrong again......as hard as they are trying..... it will be a land slide...one for the history books.

Several of the smartest/ largest investors on the planet in the past week have said to sell bonds. WE AS A COUNTRY HAVE NO BUDGET FOR THE PEOPLE......SINCE THE MID 1970's. CONGRESS LEFT TOWN WITH ZERO ACCOUNTABILITY... WHEN THE TRUTH COMES OUT THIS WINTER..BUYER BEWARE.

NYSE CUMULATIVE DAILY BREADTH remains positive.

We are unhappy about continued under performance of financials....the general market can't go much higher until this sector stabilizes. Bonds are over priced. The USD can bounce temporarily....but is being diluted beyond imagination now....all things related to hydrocarbons remains our focus

Danny Boy seen here having a ball this autumn.