Kyosaki: America Is Entering An Era We Will Be Calling The New Depression

Robert Kyosaki the author, investor, businessman, self-help author and motivational speaker best known for his Rich Dad, Poor Dad series told us what he is expecting for 2010:

1. Will China crash? America’s crash has hit China in the gut. The Chinese are laying off millions of workers. Only massive government bailout is keeping the economy afloat. The Chinese boom will eventually go bust...but will it bust in 2010? Only time will tell.

2. When America stopped importing from China, China stopped importing from the rest of the world. This affects Asian countries as well as Australia, Brazil, and other suppliers of raw materials.

3. Fed Chairman Ben Bernanke is replacing toxic debt with new debt. By protecting his friends in the mega-banks, he is turning the U.S. into a zombie nation. The recession is over, but America is entering an era we will be calling The New Depression, a period when the rich become extremely rich but everyone else becomes poorer. Taxes will kill anyone working for a paycheck.

4. The U.S. dollar will grow weaker. If the dollar strengthens, we will have more unemployment because our goods become too expensive and we will export less.

5. The deficit will increase. The bailouts for the rich are killing the economy.

6. Israel may attack Iran. Israel will not tolerate Iran developing nuclear power, even if Iran claims it is for peaceful purposes. If there is an attack, oil prices will go through the roof.

7. Dead cat bounce. The current stock market rally will probably turn into a dead cat bounce. If the Dow drops below 6500, 5,000 may be the next stop.

Art Cashin: This Rally Look Like 2003. Watch Tax Selling.

Veteran trader Art Cashin expressed his bearish views today on CNBC. Cashin is worried about an overbought market and also about the possibility of tax selling in January:

“Six out of the last 10 Januarys have been down and there is some feeling that people are taking more notice of tax strategies. There wasn’t an awful lot of tax selling this year, although we had a very significant rally from March.

The rally (in 2003) ran from late February into year-end and it lasted a bit into January or so, and then we had a pullback after that. So we’re still waiting to see. I’m stubbornly concerned that they are overvalued — there is a feeling that it’s Nasdaq 4,000.” in CNBC

Doug Kass: Utilities Will Be The Best Performing Sector In 2010

Doug Kass expressed his market views for 2010 and he is expecting Utilities to be the best performing sector in the US stock market:

"Rate-sensitive stocks will outperform and metals will underperform. Utilities will be the best performing sector in the U.S. stock market in 2010; gold stocks will be the worst performing group, with consumer discretionary coming in as a close second."

Doug Kass is the general partner Seabreeze Partners Long/Short LP and Seabreeze Partners Long/Short Offshore LP. Until 1996, he was senior portfolio manager at Omega Advisors, a $6 billion investment partnership. Before that he was executive senior vice president and director of institutional equities of First Albany Corporation and JW Charles/CSG. He also was a General Partner of Glickenhaus & Co., and held various positions with Putnam Management and Kidder, Peabody. Kass received his bachelor's from Alfred University, and received a master's of business administration in finance from the University of Pennsylvania's Wharton School in 1972.

Related ETF`s: Utilities SPDR (ETF) (Public, NYSE:XLU)

Related Stocks: Exelon Corp. (EXC), Southern Co. (SO), DUKE ENERGY CORP. (DUK), American Electric Power Co. Inc. (AEP)

Doug Kass: The U.S. Dollar Will Explode Higher

Doug Kass wrote his 2010 Investment and Political Outlook on Barron`s website. Kass is very bullish on the US dollar and he thinks that gold stocks will be the worst performers of 2010:

"The U.S. dollar explodes higher: After dropping by over 40% from 2001 to 2008, the U.S. dollar continued to spiral lower in the last nine months of 2009. Our currency’s recent strength will persist, however, surprising most market participants by continuing to rally into first quarter 2010. In fact, the U.S. dollar will be the strongest major world currency during the first three or four months of the new year."

Regarding sector performance in 2010, Kass added:

"Unhedged, publicly held gold companies report large losses, and the gold sector lies at the bottom of all major sector performers."

Doug Kass was one of the few traders / market commentators to call the March low when we said in early May that we were witnessing a "generational low" in stocks.

Price Earnings Ratio Rising From 10 To 24. Is It A Warning Signal?

Bespoke Investment Group wrote an interesting article recently regarding the big uptick in Price Earnings Ratios (PER) in the S&P 500 Index:

"The most recent new high for the S&P 500 has been accompanied by a big tick higher in the trailing 12-month P/E ratio. We'll definitely need to see some earnings growth in 2010 for this rally to continue."

The trailing 12 months P/E ratio has gone up from 10 to 24.50 in only 9 months. As Marc Faber said, "It will be more difficult to make money in 2010 as the markets become more volatile. I think 2010 will be more of a year when not to lose any money will be very important. I am a little more cautious in general."

Related ETF: SPDR S&P 500 (ETF) SPY

John Paulson And Victor Sperandeo Are Very Bullish On Gold

Two of the best traders on Wall Street expressed their bullishness on Gold. John Paulson expressed his views on Gold during an address to the Japan Society in New York:

"As an investor, I became very concerned about having my assets denominated in U.S. dollars. So I looked for another currency in which to denominate my assets in. I feel that gold is the best currency."

Victor Sperandeo, or Trader Vic considers that that gold is the best investment in the world for the next two to three years:

"Well, I'm on record across the world as saying that gold is the best investment in the world for the next two to three years. If you go back to its lows, and you compound where gold is today, it's about 6.5% compounded. That isn't a bubble."

Victor Sperandeo latest book, "Trader Vic on Commodities" is a must read for commodity futures traders:

In Trader Vic on Commodities, Wall Street legend Victor Sperandeo explains in simple terms how these markets operate, removes some of the mystique and uncertainty involved, and offers a proven method for capitalizing on commodity market trends—without taking giant risks. He introduces a valuable tool—the Standard & Poor's Diversified Trends Indicator (S&P DTI)—to capture price movement, premiums, and discounts in the commodity futures markets. Sperandeo shows that, as commodities are cyclical in nature, the best goal is to capture as much of the major trends of each market as possible, while balancing that goal with a minimum of risk. in Amazon.com

Where To Put Your Money In 2010

Bespoke Investment Group asked some professional financial bloggers where will they invest their money in 2010 and here are the answers:

Starting with 100% cash, how would you allocate it to various asset classes to start the new year?

A Dash of Insight: I see this as a good time for stocks, so give that a plus 10% or so from whatever is the starting point. If you are normally 55% in stocks, this year should be 65%. The main alternative is corporate bonds and financial preferreds. These still have nice yields. You have to watch carefully if the Fed starts to raise rates.

Crossing Wall Street: 100% stocks.

Financial Armageddon: As follows: 60% Treasury bills, 25% bearish stock market ETFs, and 15% gold.

Vix and More: My 2010 allocation is overweight in all types of commodities and emerging market equities, as well as underweight in U.S. Treasuries and cash.

Investment Postcards: Gold 10%, Government bonds 6%, Real estate 10%, Equities 50%, Cash 24%.

World Beta: We follow a tactical approach that trades equities, bonds, real estate, commodities, and currencies. It trades dynamically, and while currently fully invested (and short the dollar), that can change very quickly.

Its a big surprise for me that most blogers had a mainstream, institutional answer. But these are not the best trading blogs and you probably know a few that are better...

Art Cashin: We Still Have A Few Years To Go Before The Full Bull Resurgence

Art Cashin, the Wall Street veteran said yesterday that the stock market is in another 17.6 year cycle like the period between 1966 to 1982 and 1929 to 1947.

Art has been bearish and wrong since April always betting against the stock market rally that is still marching higher. Its amazing that a man with his knowledge and experience can be so sistematically wrong on the market for so long.

Even though I always like to listen to his market commentary and his short term market calls:

Cashin reiterated his "theory of the 17.6-year cycle." He pointed out that the periods 1966-1982 and 1929-1947 were "lean cycles." "And we're still in one of those lean cycles. We still have a few years to go" before the full bull resurgence. in CNBC.com

Most Overbought Stocks

The S&P 500 is trading at new 2009 highs and many stocks are considered to be in overbought territory. Two semi`s stocks top the list, with Advance Micro Devices (AMD) and Nvidia (NVDA) as the most overbought stocks in the S&P 500 Index.

United States Steel (X) is the most overbought stock in the materials complex, followed by Titanium Metals (TIE). Some surprising names on the list are Ford (F) and Southwest Airlines (LUV). These are probably the best stocks to short as the fundamentals of their industries keep deteriorating.

This Decade Was The Worst Ever For Stocks

This decade was the worst ever for stocks. Since the end of 1999, the S&P 500 index has lost an average of 3.3% a year on an inflation-adjusted basis which is worse then the performance in the 1930`s during the Great Depression:

"With two weeks to go in 2009, the declines since the end of 1999 make the last 10 years the worst calendar decade for stocks going back to the 1820s, when reliable stock market records begin, according to data compiled by Yale University finance professor William Goetzmann. He estimates it would take a 3.6% rise between now and year end for the decade to come in better than the 0.2% decline suffered by stocks during the Depression years of the 1930s.

Since the end of 1999, the Standard & Poor's 500-stock index has lost an average of 3.3% a year on an inflation-adjusted basis, compared with a 1.8% average annual gain during the 1930s when deflation afflicted the economy, according to data compiled by Charles Jones, finance professor at North Carolina State University. His data use dividend estimates for 2009 and the consumer price index for the 12 months through November." in WSJ

But Japan`s stock market had two decades like this in a row. So its difficult to argue that it cannot get worse going forward.

Joseph Stiglitz Sees A Significant Risk Of Contraction In 2010

Nobel Prize winner Joseph Stiglitz sees a significant chance the U.S. economy will contract again in the second half of 2010, and urged the government to prepare a second stimulus package:

"The likelihood of this slowdown is very, very high. There is a significant chance that the number will be in the negative range," said Stiglitz, a professor at Columbia University.

Regarding the jobs picture in the United States, the economist added, "The U.S. economy must grow at least 3 percent to create enough jobs for new entrants into the labor force."

"If you don't prepare now, and the economy turns out to be as weak as I think it's likely to be, then you'll be in a very difficult position," he said.

Santa Claus Rally Measured

The only question still open for this year is if we are going to have a Santa Claus rally in the stock market. The Santa Claus rally is measured by the performance in the seven trading days that start with Christmas Eve and end with the first two days in January:

The S&P has increased an average of 1.5 percent during the seven trading days that start with Christmas Eve and end with the first two days in January since 1950. That's the widely recognized period for the Santa Claus rally, as first identified in 1972 by Stock Trader's Almanac founder Yale Hirsch, Jeff's father.

Stocks went up in 12 of the last 15 of those year-end periods.

Marc Faber`s Picks For 2010

Dr. Marc Faber shared with the Economic Times his investment themes for 2010. Japanese stocks and shorting US Treasuries are his top picks for 2010:

"I would avoid US government bonds and I think as a contrarian you really want the contrarian play. You should buy Japanese stocks and Japanese banks. This is the absolute contrarian play. Nobody is interested in Japan all the funds have withdrawn money from Japan they have given up on Japan I guarantee you the economy would not do well, forget about the economy the population is shrinking but you can have an economy that does not do well but the companies do well that is a big difference and I think the Japanese banks are very depressed. All the banks in Asia have actually recovered very strongly but not the Japanese banks so as a contrarian play I would look at that." in Economic Times

Dennis Gartman Is Bullish On Stocks

Dennis Gartman thinks U.S. stocks will continue to rally into the new year, even as the dollar appreciates:

“I think there’s going to be more than a Santa Claus rally,” Gartman, editor of the Gartman Letter, told Bloomberg radio in an interview today. “The trend is probably toward higher share prices and will continue after the end of the year.”

About the recent US dollar`s strength Dennis added,

"Like the proverbial hot knife through butter, the dollar is moving sharply and violently higher, most notably relative to the euro, and we are now more and more convinced that this is something more than a mere correction,"

Meredith Whitney Lowers estimates for Goldman Sachs

The bank star analyst Meredith Whitney is lowering estimates for Goldman Sachs and Morgan Stanley.

Meredith Whitney Advisory Group lowered estimates for Goldman Sachs (NYSE: GS) and Morgan Stanley (NYSE: MS):

On Goldman Sachs, the firm lowered Q4 EPS estimates from $6.38 to $6.00 (cons $5.59), FY09 from $19.95 to $19.57 (cons $19.29), FY10 from $21.73 to $16.75 (cons $18.78), and FY11 from $24.04 to $20.60. The firm set 2012 EPS at $21.45.

On Morgan Stanley, the firm lowered FY10 EPS estimates from $2.63 to $2.60 (cons $3.32) and FY11 from $3.28 to $2.75. The firm set 2012 EPS at $2.90.

Meredith Whitney has a Neutral rating on both stocks. in Street Insider

Goldman Sachs stocks are trading down 1.7% in pre-market action.

Bespoke`s Paul Hickey Says Its TIme For "The Dogs Of The Dow"

The "Dogs Of The Dow" trading strategy consists in buying the 10 stocks of the Dow Jones 30 that have the highest dividend at the beginning of the year. Bespoke Investment Group thinks the strategy will do very well in 2010:

“For the last 3 years, the "The Dogs Of The Dow" has been dead: "it’s underperformed each of the last 3 years and cumulatively, it’s down 28 percent—whereas the Dow is only down 8 percent over the last 3 years,” Paul Hickey told CNBC late yesterday.

However, looking ahead to the new list of companies going into 2010, Hickey said there are some encouraging signs:

“The names being added as of today are Home Depot (HD), Intel (INTC), Chevron (CVX) and McDonald’s (MCD).Most of these stocks are up or flat over the year and they’ve been raising their dividends,” he explained.

“In the prior years, the companies that have made up the Dogs of the Dow have been financial companies and other companies that have been saddled with debt.”

Hickey said the 2010 Dogs of the Dow have an average dividend yield of 4.3 percent and don't have as much debt as the companies in the past.

These will be 2010`s Dogs of the Dow: Pfizer (PFE), DuPont (DD), AT&T (T), Verizon (VZ), Merck (MRK),Kraft Foods (KFT), Home Depot (HD), Intel (INTC), Chevron (CVX), McDonald’s (MCD)

Rydex Money Flows Show A Top In The S&P 500

Rydex money inflows into leveraged Bull and leveraged Bear funds are at an extreme reading signaling a possible short term market top:

"Figure 1 is a daily chart of the S&P500 with the amount of assets in the Rydex bullish and leveraged funds versus the amount of assets in the leveraged and bearish funds. This data is hidden, but the ratio of bull to bear, which is depicted by the indicator in the lower panel, is 2 to 1. Since July, 2009, every time this ratio got above 2, it marked a short term top in the S&P500" in The Technical Trade

"Figure 2 is a daily chart of the S&P500 with the amount of assets in the Rydex Money Market Fund in the lower panel. The current value is the lowest value since the rally began in March, 2009. While all of this is short term noise, it is absolutely amazing that there would be this much commitment to the market after a 60% plus run in the S&P500." in The Technical Trade

Is it a good time to short the us stock market? Statistics are on the bear`s side.

How To Trade The S&P 500: Buy Low And Sell High.

All the research I`ve conducted over the years on the S&P 500 Index point to the same conclusion. It must be traded countertrend, at least in the very short term. This is a piece I have found on TraderFeed that confirms this view:

"Let's take the S&P 500 Index (SPY) over the past five years:

If we bought rises above the 100-day moving average and then went short on moves below the average, we would have made a total of 56.6 points or about 56%. That is despite the fact that only 8 out of 46 trades were winners.

If, however, we traded the system with a 50-day moving average, we would have generated 98 trades with 17 winners. That would have lost us 10.75 points or over 10%.

Suppose that we now trade SPY with the same system, only using a 20-day moving average. Now we generate 166 trades, with 44 winners, but the system loses 23.05 points or over 20%.

Moving even shorter term, we can define a system that would buy on moves above short-term envelopes and sells on moves below those. Using envelopes created by high prices over the past 10 sessions and low prices over the past 8 sessions, that system traded 249 times over the past five years with 67 winners. That system would have lost essentially all the trader's money over five years.

What that says is that, if we're trading in a trend following mode, the more actively we trade (using shorter-term definitions of trend), the more money we lose. This is an important reason why short-term traders who have bought on strength and sold on weakness have performed poorly in recent years." in TraderFeed

Chanos Is Bearish On China, Ford And Fiat

Jim Chanos, one of the best short sellers on the street has expressed his market views today on CNBC`s Fast Money. He thinks Wells Fargo (WFC) will still face some headwinds:

As most of the banks have raised significant equity capital recently, they have seen their stocks go up "initially, on a relief rally," Chanos says, but he thinks the jury is out on Wells Fargo, citing "reasonably difficult" loan problems ahead of them. Chanos also sees the balance sheets of major banks being "better than they were 6-9 months ago," but he is also hesitant to say that the books are where they should be for the firms, again citing residential and commercial real estate loan problems as well as dramatic security mark-ups resulting from accounting changes. "I wouldn't be a buyer here," he says, "I don't know if I'd be a seller, but I would be pretty ambivalent about the sector." With a few minor exceptions, Chanos says he's staying away from the financials


Jim Chanos basic strategy is to be long the overall stock market and to short specific names. His fund is a dedicated short seller and his firm is always net-short. Right now he sees opportunities for short sellers in individual companies and sub-industries, but not the overall market:

Even with the bankruptcies of GM and Chrysler, we have seen increased global capacities for autos in the last 12 months. He sees the sector as a whole with the lingering problems of overcapacity, as well as legacy costs. He suggests that investors don't go long Ford or Fiat.

In a recent report, Chanos' firm has been very pessimistic about China, and his firm has even gone as far as to speculate that China could be "Dubai times 1000, or worse." He is also skeptical of the country's GDP numbers, calling them "massively inflated by under-depreciating a very, very, very shaky capital asset base." Chanos says that although you can't short China, the short plays are in the first derivative industries: companies which support the raw and imported materials for growth (such as copper, cement and iron ore producers). He also suggests looking into short possibilities in the Hong Kong exchange.

Hugh Hendry Is Bullish On The US Dollar

Hugh Hendry is one of the best known hedge fund managers in the UK. He is a contrarian and has been wrong since March. He is in the deflation camp and is betting on a US Dollar rally:

“Some of the strongest deflationary forces will be felt in Europe, so we have the biggest overweight there in government bonds. The rest of the world is overweight emerging markets, but we have nothing. The rest of the world is terrified of the dollar. We are trying to create some positive dollar exposure. If risk aversion returns, the dollar will rise and we will make money. If it doesn’t happen, we won’t lose any.”

This Week Has Been The Most Consistently Positive Week Of The Year For The S&P 500 Index

"This week is options expiration. Over the last 25 years December options expiration week has been the most consistently positive week of the year for the SPX. Below I’ve updated and expanded the study from last December that looked at this phenomenon."

in Quantifiable Edges

Larry Connors: How To Profitably Trade ETF`s

Larry Connors is the CEO of TradingMarkets.com and co-author of Street Smarts with Linda Raschke. In his lastest article he reveals some of his most profitable trading rules:

"Systematic high probability ETF trading does not need to be difficult. In fact, if you run the following test on all the major equity ETFs, you'll find some eye opening numbers.

1. The ETF is above the 200 moving average.

2. Buy the ETF when the 2 period RSI closes under 2.

3. Buy a second unit if prices close lower than your first entry.

4. Exit when the 2 period RSI closes above 70.

That's it. 4 rules. Run the results for yourself on a basket of equity ETFs going as far back as you have the data on them (the SPYs go back to 1993)." in TradingMarkets.com

I have been following Trading Markets work since 2000 and they provide some of the best quantitative research to retail investors.

Roubini: Five Reasons To Be Bearish On Gold

Nouriel Roubini has opposed Jim Rogers and Peter Schiff recently with his rather bearish calls on gold. Here are his five reasons to be bearish on gold right now:

"First, the dollar carry trade may at some point unravel, popping the global asset bubble that this carry trade has fueled.

Second, central banks will eventually need to exit quantitative easing and effectively zero policy rates, which will put downward pressure on risky assets including commodities.

Third, bouts of global risk aversion may occur as the global recovery may turn fragile, anemic and subpar, thus leading to a rise in the U.S. dollar that would drive down prices of commodities and gold in dollar terms.

Fourth, since the carry trade and the wall of liquidity are causing a global asset bubble, some of the recent rise of gold is also bubble driven by herding behavior and momentum trading, pushing gold higher and higher. But all bubbles eventually crash and the bigger the bubble the bigger the eventual crash.

Fifth, the effect of rising sovereign risk on gold prices is ambiguous, as the events of recent weeks suggest. A risk in such risk could push up the price of gold if it leads to expectations that central banks will eventually monetize those fiscal problems. But in practice it has weighed on the price of gold because it has increased investors’ risk aversion and led to a rush into a different (and more liquid) asset than gold—e.g. the U.S. dollar—thus pushing gold prices down. In general, gold always competes with fiat currencies and anything that is dollar bullish—like repeated bouts of global risk aversion—tends to be gold bearish." in Roubini Global Economics

Related ETF`s: SPDR Gold Trust (ETF) (Public, NYSE:GLD)

Morgan Stanley`s Roach Is Fearful Of The FED`s Exit Strategy

The FED may cause another crisis by not withdrawing liquidity from the U.S. economy, Morgan Stanley`s Stephen Roach said today:

"The Fed is the “weak link” among central banks and may fail to tighten monetary policy in time to stop asset bubbles from forming, Roach said at a conference in Berlin today. The Fed helped trigger the boom and then bust of the subprime mortgage market by being “quick to slash, slow to normalize” interest rates, he said.

Fed Chairman Ben S. Bernanke said Dec. 3 he doesn’t rule out using monetary policy to prevent unfounded increases in asset prices, though he said financial regulation is a better approach. Bernanke said this week the U.S. economy continues to face “formidable headwinds,” signaling the Fed will keep its benchmark interest rate near zero for an extended period.

“They need to be very early in executing their exit strategies,” Roach, a former Fed economist, told Bloomberg Television. “I take Mr. Bernanke at his word that he’s looking for an extended period of monetary accommodation, which, quite frankly, I find very worrisome in assessing the prospects of a next bubble and the next crisis.”" in Bloomberg.com

The Federal Reserve will meet today and Wednesday and will produce its statement on monetary policy. The removal of the line "rates will remain low for an extended period of time" can be a market mover.

Gold Is Not A Bubble But I Prefer Silver

Jim Rogers has been bullish on commodities for a long time. He was on CNBC last friday and he gave his views on Gold and Silver. While he is bullish on both precious metals he prefers silver because is still 70% below its all time highs:

"I wouldn't think of selling gold. If gold goes to 1,000 dollars (per ounce) I hope that I'm smart enough to buy more."

With central banks now buying gold and many people worried about paper money, gold will be a great investment over the next decade and relatively few people are invested in it, Jim said. At a speech in Prague Rogers surveyed about 300 people, including big money managers, and 76 percent had never owned gold. Jim says that is the proof he needs to acknowledge that gold is not in bubble territory. Still, silver is preferable, with silver 70 percent off its all-time high and gold near it's all-time high.

Related ETF`s: iShares Silver Trust (ETF) (NYSE:SLV) and SPDR Gold Trust (ETF) (NYSE:GLD)

This Rally In Historical Context

The B.I.G. blog always produces high quality research on the markets. This piece is about the magnitude of the stock market rally from the March lows put into historical context:

"It has been exactly nine months since the S&P 500 bottomed on March 9th at 676.53. Since then, the index has rallied 62%. Below we provide a chart of the rolling 9-month change (%) for the S&P 500 going back to 1928. As shown, 1933 was the only other time when the S&P 500 had a bigger 9-month gain. The 9-month period ending on May 12th, 1983 is the next best behind the current one with a gain of 60%. Also, the 9-month 62% gain was preceded by a 9-month decline of 51%. The only time that the index fell more over a 9-month period was in 1931/32 when it dropped 68%. " in Bespoke Investment Group Website

But this does not mean that the market has to sell off to correct itself. It can also go sideways and "correct" the extreme rolling 9-month change (%) on the S&P 500.

Greenspan Expects A Quick Rebound In Jobs

Alan Greenspan, the former Fed Chairman said today to NBC`s "Meet The Press" that he expects a quick rebound in jobs because companies are stretched to expand production after workforce cuts made during the recession.

"Businesses were very frightened by the financial crisis and deterioration of the U.S. economy early this year and cut their payrolls so deeply that they will have to begin hiring soon. We have a level of employment at this stage which is barely adequate to staff the level of output. It seems to me virtually inevitable, if nothing else were to happen, that employment would start to come back fairly quickly.” Alan Greenspan, in Meet The Press

Is Greenspan reading the economy right this time?

Jim Rogers Is Bearish On The US Economy: "It`s Getting Worse, Not Better"

Jim Rogers was interviewed on Yahoo Finance`s TECH Ticker. He is bearish on the US Economy and said that the United States is "doing the Japanese model". These are the highlights from that video interview:

"Papering over the problem is not going to solve America's problem. The idea you can solve a problem of too much debt and too much consumption with more consumption and more debt defies belief. I cannot believe that grownups would stand there and say that."

"History shows the only way to solve a financial crisis is when people go bankrupt, you let them go bankrupt. Then, competent people come in, take over the assets, reorganize and you start over. But rather than take the pain and reorganize and start over, as Sweden, South Korea and others have done, America is doing the Japanese model."

"What has been happening is the government has been printing and spending a lot of money. The problem is not solved - they're making the problem worse."

"The problems in last two years came from industries that are heavily regulated: banking, insurance, mortgage. Now what? You're going to make the regulations tougher? It's not the regulations, it's the regulators."

John Paulson Is Bullish On Stocks

John Paulson, one of the best hedge fund managers in the US, has done an about-face since his very bearish position on the stock market last year. First it was the reflation trade, now it is full blown bullishness. In a presentation earlier this week, John Paulson, president of Paulson & Co., Inc., a New York-based hedge fund said he still finds the equity markets very compelling and currently has no short positions in the credit markets:

“Today our net long exposure is perhaps the highest it has ever been in our portfolio. We still find a lot of compelling long investments on the equity side.”

Bill Gross: Buy Stocks With High Dividends

Bill Gross, "The Bond King" who manages 1 trillion dollars in fixed-income investments at Pimco, has been urging investors to move out of low-yielding bonds and savings accounts into utility and telecom stocks with high dividends:

"The last 12 to 18 months have proved there's an appropriate price for liquidity and these days that comes in the form of a near-zero percent yield. For the typical small investor, that represents an insurance policy or a way station for required expenditures in the near-term future."

Instead of draining their money-market accounts, Gross would rather see investors replacing some of their growth stocks with high-dividend-paying stocks.

"Don't forget that even today's 2% to 4% bond yields aren't as paltry as they look, because inflation remains close to zero. The 6% interest income you remember earning a decade ago came at a time when inflation ran about 3%. You might protest that inflation, as officially measured, is understated today—but it is probably no more inaccurate now than it used to be. In real terms, you are only slightly worse off now than you were then." Bill Gross in WSJ

Roubini On Gold

Nouriel Roubini of RGE Monitor and professor of economics at NY University's Stern School of Business is bearish on gold. Roubini said:

"I don't believe in gold. Gold can go up for only two reasons: One is inflation, and we are in a world where there are massive amounts of deflation because of a glut of capacity, and demand is weak, and there's slack in the labor markets with unemployment above 10 percent in all the advanced economies. The only way gold can go higher in a deflationary economy is a financial Armageddon but we've avoided that tail risk as well. So all the gold bugs who say gold is going to go to $1,500, $2,000, they're just speaking nonsense.” in CNBC

Related ETF`s: SPDR Gold Trust (ETF) : GLD