Pack a lunch and blow the froth off a cool one…as I’ve got three days of gold and silver market activities to talk about…and lots of fascinating reading as well.

Wednesday, November 26th

This was the last day for all parties to get their gold and silver contracts switched to the 2009 year…or they would have to stand for delivery on Friday. With the U.S. in holiday mode almost from the beginning of trading, the tiny rally at the Comex open was stepped on and never recovered. But it hardly mattered…as volume was virtually non-existent. Silver was the same. Call the day a big zero. However, the shares reacted otherwise. Even though gold was down ten bucks at the close of the equity markets, the HUI still managed a surprising 6% increase…the second day in a row that gold has been flat or down…and the HUI up. Hmmm!

Open interest on Tuesday showed

Where will the credit crisis’s penny drop next? On centre stage at the moment are emerging market currencies, having crashed in many instances over the past few weeks. A picture tells a thousand words … (Yes, South Africa has been highlighted as it is my base currency, and my overseas overheads have just become exponentially more expensive. But, your holiday to this part of the world has also just become a bargain.)

Source: Plexus Asset Management (based on data from I-Net Bridge)

The jury is out on whether some of the declines in emerging currencies merely represent an adjustment from overvalued to more realistic levels. The risk of national defaults and corporate bankruptcies holds the key to what represents fair value.

As I am travelling in Europe at the moment (see “Another town, another train…”), this week’s edition of “Words from the Wise” does not provide the customary review of the financial markets’ movements and economic statistics. Given time constraints, today I will only share with you a number of video clips in lieu of excerpts from news items and quotes from market commentators. Quite a few of the video items include links to related articles for those who prefer the written word.

Firstly, as we are awaiting word on the bail-out plan, a very topical quote from Jim Welsh (Welsh Money Management): “We will be told that the Federal Reserve and

Still on the topic of the bail-out plan, guest contributor Bill King (The King Report) offers his ideas on how to put a more credible plan together. His thoughts are insightful and deserve the urgent attention of the powers that be.

Premises • The US credit system is broken. • The Paulsen-Bernanke Bailout Plan does not insure that those banks and brokers that receive bailout aid will increase lending. The reality is the market is hoarding liquidity and these banks are likely to do the same. More importantly consumer lending has been a small, often insignificant part of their business. They made money by trading and through securitization of debt. • It is necessary to create a new system parallel

After stock markets have held up bravely in the face of the credit crises and mounting economic woes, a combination of renewed concerns about the financial sector, a record-breaking spurt in the oil price, and a rotten unemployment number claimed their toll on Friday, triggering a sharp sell-off in most parts of the world.

“Today was a bona fide panic day. They threw ‘em in,” said Richard Russell, author of the Dow Theory Letters for the past 50 years. The bears were out in force, as personified by Bill King (The King Report): “The technicals, seasonals, fundamentals and financial system conditions are negative. And now the Fed

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Prepare yourself now.

The market is widely referred to as a discounting mechanism. However, its ability to discount anything extends only as far as the collective knowledge of its participants. And to be blunt, the vast majority of today’s investors— professional or otherwise— know little if anything about making money in the market.

With the advent of discount brokerages— E*trade, Ameritrade, etc— in the late ‘90s, a huge wave of novice investors entered the US financial markets. Between 1990 and 2000, the number of US households invested in mutual funds doubled from 25 million to 50 million. This wave of new, uninformed money supported two major trends: the Tech Bubble, and the rise of the financial media.

Regarding the latter, in 1990, stock market developments were relegated to 15 minutes of coverage on major news programs. Only ten years later, there were at …

Equity bulls experienced another good week based on the viewpoint that the worst of the credit crisis might be behind us. A further improvement in investor sentiment and increased risk appetite caused market participants to cast aside a mixed bag of economic and corporate data and look across the “economic valley”.

This raises the question of whether the stock market euphoria is premature. Bill Gross of PIMCO (Money News) said the recovery is primarily due to federal policy moves to restore liquidity. It won’t last long, Gross warns. “Recession, and its vicious-cycle effect on employment and consumer spending, remains a threat,” Gross says. “This recession, though currently mild, and, as of yet, not even officially validated, may not be

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