Independence Day

I hope everyone has a safe and happy 4th of July weekend.  We will be traveling to our annual family reunion.  I might sneak in some golf too.
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The Feds QE2 Scorecard:
Where QE2 Worked and Where it Didn't
Quantitative easing—which ends Thursday—effectively reached some of its goals and badly missed at others, but the unprecedented government intervention program’s final legacy is far from being written.

Fed Chairman Ben Bernanke launched the program with hopes that it would create a “wealth effect”—a rise in asset prices that would help convince Americans that the financial crisis had passed and better days were ahead.

No doubt there has been a considerable rise in a variety of assets, and if you’re lucky enough to own them you probably did quite well in the eight months since the central bank launched the second wave of easing, known as QE2 in market lingo.

But if you were one of those stuck in the mud of the housing market downturn and jobs slump, you didn’t do nearly as well.

A look, then, at five areas where QE2 worked—and five were it failed.
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Here is a portion of Eric's piece:
Eric Sprott on the Truth about Silver
We have a very tough time understanding those bearish arguments against silver. We look at the real silver market, and based on the supply and demand data coming from the real, physical markets for silver, the fundamentals are only getting stronger. And yet there exists another silver market, which as we’ve shown, is not very connected to the physical realm at all. And though silver investors have for decades suffered the tyranny of a rigged paper monopoly over silver price discovery, it appears to us that the tides are turning. In the age of QE to infinity, investors are being more scrupulous with their capital and as such they are demanding physical silver in quantity. With more and more dollars flowing into the silver markets and a finite supply of physical to meet that demand, the theoretical losses for the paper silver short-sellers are near infinite. And with such a skewed and obvious risk/reward payoff vastly favoring the longs, we pose the following question. Who is most at risk in the silver markets: the buyers of a scarce and real asset that serves a growing multitude of purposes, or the sellers, who are short a quantity of silver which may very well not even be obtainable at anywhere near current prices? Let the Seller Beware!

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I read this today from Stansberry Research.  This is an example as to why I like the metal stocks so much.  They have more value that ever.

Today officially marks Financial D-Day – the end of the Federal Reserve's second round of quantitative easing (QE2)… and nothing happened. The yield on 10-year Treasurys jumped just a few basis points.

The market knew it was coming. A friend who runs one of the biggest bond desks on Wall Street said it's business as usual today. The markets are more concerned about Greece.

 But don't get used to this calm. The Fed won't keep its finger off the print button for long. As we've said all along, the Fed will only let the country experience a little pain (inevitable as the largest buyer of U.S. debt steps back) before launching a new round of quantitative easing.

Since QE2 began in November 2010, the Fed has bought around 85% of the net Treasurys issued, according to Morgan Stanley economists. And in each of the first six months of 2011, the Fed bought all but $17 billion of Treasurys sold. JPMorgan estimates private buyers will have to absorb $94 billion a month in the Fed's absence. And only one thing – outside of "friendly" nudging from the government – will attract those buyers… higher yields.

 Rest assured, we'll see a flood of new cash soon. And that's when the fun starts. In a recent Bloomberg interview, market whiz Jim Rogers said the Federal Reserve is his biggest fear today…

They don't have a clue about economics or currencies. They don't have a clue about much of anything. And they are dangerous people. They are not doing good things for the world. And they will probably stop QE2… they said it so many times they will. But when things start going wrong again in a few days, weeks, or months, they are going to start printing money again… And that's not good for the world. That's going to lead to more problems for all of us over the next decade. This is a serious problem facing us.

 So what do you want to own when QE3 begins? Precious metals. Gold and silver, as our friend Doug Casey likes to say, are "going to the moon!" Owning gold and silver bullion is the best way to protect yourself from a currency collapse. However, you can make big money buying gold stocks, as well.

We've written several times about how cheap gold stocks are in relation to the gold price. Gold is currently around $1,500 an ounce. But most gold stocks are priced the same as they were two years ago – when gold was $1,000. In his latest S&A Short Report, Jeff Clark writes:

Gold stocks are cheap. Many of them trade at 12 times earnings or less – a big discount to the S&P 500's earnings multiple – and many of the big name gold companies pay decent dividends. With global economic conditions around the world what they are, it's easy to make a strong fundamental argument for owning gold and gold stocks.

This one-year chart shows the underperformance…