Christmas is a good time for sharing memories and here is my story.
I come from a country which was a part of the former Soviet bloc where socialism and central planning were the name of the game. It was meant to be a system with happy people across the board as opposed to capitalism with its exploitation, unemployment and constant boom and bust cycles. Central planners needed to take care of it and they did. Certainly they had to make sure that things are affordable for everybody. It was not an easy task at times when my father who was a finance director in a factory with 5000 employees was making an equivalent to $10 a month (this is not a mistake: one hundred and twenty US dollars per year). You can only imagine how cheap things needed to be in order to make everybody happy. And they were cheap but naturally very difficult to get. I recall times when every day after school I was spending an hour in a line for food, then my mother was taking over from me and after another hour spent in a line she was able to buy food for that day. But it was affordable so we ought not to complain…
For big ticket items they wanted to avoid lines lasting months so they came up with an idea of issuing coupons giving right to purchase certain item at certain time. Underground market immediately developed where for example a new car bought with the coupon could be sold for 4 times as much to somebody who didn’t have a coupon. It was funny to watch 5 years old used cars being sold for more than the new one in the dealership (if you had a coupon…)
When a really big economic crisis hit shortly before the martial law was introduced we had nothing in shops but vinegar. Can you imagine a supermarket with all shelves empty but a few with hundreds of bottles of vinegar? If not here is the picture of the result of central planning:
Many were wondering why everything was sold out but vinegar. In my opinion it was simply a mistake in planning – somebody took thousands for millions and there were 1000 times more bottles produced than needed…
Central planners of course didn’t give up and after announcing that the shortages were the result of excessive speculation they introduced ration stamps for almost everything. First meat, then sugar, butter, rice, soap, alcohol, cigarettes – you name it. The shops were again full of products at affordable prices but nobody could buy as much as they were willing to. So another underground market developed – this time a market for ration stamps. I don’t need so much alcohol but would like to have more chocolate for my kids than one bar a month so why not find somebody with exactly opposite needs? And so on and so on …
All this stupidity ended only after introducing the free market by first non-communist government in early 90s. It took a lot of sacrifices and hard work along the way but 20 years later our economy is the only one in EU zone that is not contracting this year and we are considered to be the new European tiger...
What are the morals of this story?
Lesson 1
Regardless of how clever and how smart those in power are, central planning always creates imbalances which later need to be corrected by free market.
Lesson 2
Regardless of how incompetent those in power are if People are willing to sacrifice and work hard they can find the way out from no matter how big hole.
JA
jarek
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Being now bearish might actually be contrarian since a lot of market participants are expecting the end year bonuses play to the upside
JI
jimkane
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That's the break in copper I was talking about earlier today in another thread.
Not sure why, but my charts now show copper denominated the same as this chart and jarek's. Must be losing my mind.
Not sure why, but my charts now show copper denominated the same as this chart and jarek's. Must be losing my mind.
JA
jarek
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Originally posted by jimkane
Actually, jarek's version here may be the same futures (what are yours, jarek?), only with the decimal moved over two places.
Sometimes it's listed in dollars and sometimes in cents and hence your confusion. My data come from a local data provider who describes them as NYMEX futures.
There's a clear breakout from that natural set on my weekly chart with last week's close above the sliding parallel:
JA
jarek
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Originally posted by jimkane
On my charts, which are for a different version of copper than jarek's here, it exploded up and over the line. If this 'holds', as I've mentioned in here, I think it will be the single most important event in all the markets combined. It implies to me there is economic recovery and S&P 1,400 is on the way, and in short order. It seems far too unbelievable and fantastical, and I'd like to say I'm completely skeptical, but copper is the barometer, the marker for demand for building and expanding. Copper not rolling over in this critical area tells me 'deflation' is off the table. We'll see if it's a snap fake during the illiquid holidays, or not.
I agree that if the breakout is not fake then this is an important hint about where all prices are headed in the near future. However I don't quite agree that this might also imply economic recovery. In Zimbabwe they had prices going through the roof with the economy taking a nosedive at the same time. And with the US govermment buying itself probably more than half of debt is sells, this might be exactly the path to follow ...
JA
jarek
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Recently we have been discussing many weekly threads at the same time. Since their titles are so similar it's easy to overlook a post in one of them if they are used concurrently. I propose that we use only the current week thread for all discussions during the week. When you want to reply with quote from previous threads it's easy to just copy and paste it to current thread's reply. If this is too cumbersome then at least let's remove this Sticky: Rocking Chair Charts thread by Jan from page one so we can have more space on front page for currently discussed threads. Is Jan the only person who can do this?
JI
jimkane
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Originally posted by jarekNo, actually I'm the only one who can do that. The reason it's sticky is because evey time I make it not sticky someone asks what the pattern looks like, and I have to try to find that topic among the hundred or so pages. Cutting and pasting isn't a problem, we can just do that. Some day Guy will get to the quoted posts having the dates of the original posts, like it used to be, which would be useful for us.
Recently we have been discussing many weekly threads at the same time. Since their titles are so similar it's easy to overlook a post in one of them if they are used concurrently. I propose that we use only the current week thread for all discussions during the week. When you want to reply with quote from previous threads it's easy to just copy and paste it to current thread's reply. If this is too cumbersome then at least let's remove this Sticky: Rocking Chair Charts thread by Jan from page one so we can have more space on front page for currently discussed threads. Is Jan the only person who can do this?




