Hello again - and first today, a wee conundrum for you: "When is a pyramid scheme (quite legally) NOT a pyramid scheme?" (you may find a possible answer somewhere in these ramblings.)

Anyway, speaking of pyramid schemes, mention was made in WICS of January 11th this year, that the Madoff one was only the tip of an iceberg, and now we see the exposure of "Sir" Allen Stanford - what an expert con man, eh? It's just not cricket, old chap.....but as with Madoff, those "in the know" did indeed "know", and it's truly amazing how long these guys got away with their scams. (In Stanford's case, the first warning to everyone came as far back as 1991, when Montserrat (a smallish tax haven - so possibly not right at the top of the tree as regards total fiscal transparency) withdrew Mr S' banking licence....and there have been other "warnings" since then. It's amazing really the nonsense people will believe if they WANT to believe it - which of course is why Ponzi (pyramid) schemes are able to exist in the first place - and why politicians survive in office, far longer than they should.

Moving on to something that really goes beyond the boundaries of credibility, we note the Broon one's assertion today that "We will put people first, not bankers." Ho ho ho. That from the man who spent more than a few years as chancellor, tugging his forelock in true dullard peasant fashion to Squire Bendtherules of Financialprobity. "Aye, Squire - ye ken best. An' Ah'll help ye mak loadsa cash by changin' they annoyin' wee laws furr ye - jist tell me an' Ah'll dae it...." And as Broon promised, so he did - "accommodating" might be a good word to describe the Broon one's approach to "high finance", assuming he actually knew what was going on in the first place. It wouldn't have been anything at all to do with ensuring his own wealthy retirement after his rear end has been kicked out of Downing St - perish the thought. "Och Squire, when Ah leave poalitics, Ah'll only need a wee baggie o' oatmeal an' a barrel o' salt herrin' from ye.........an' maybe a few hunner' thoosan' poonds a year in consultancy fees..."

Speaking of barrels, the Obama bailout in the USA should create a whole lot of new jobs for coopers.....as in "pork barrels" - try the WICS search engine with that, if you're a bit lost here!

Back to the Broon one for a moment - he's seemingly taking on Switzerland anent "tax evasion" by UK citizens. The Swiss will be trembling in their boots. Note the wording though - "UK citizens". Not a word about Big Bizness, which perhaps may NOT be trembling in its boots. It all sounds good though, eh? And it helps divert attention from problems at home for about five minutes.

On to headlines - the best of the week for this guy was "Bank Boardroom Bonuses Banned." Another "Ho ho ho" is called for methinks. The other one was "Bank of England Warns Britain Heading for Deflation." Always ahead of the curve, eh? Maybe if they just sat still for a wee while, the "curve" would catch up with them? And still re banks, if anyone thinks the recent extra £10bn of writeoffs (HBOS last week) is the end of the story, dream on. The ONS reckons there could be an awful lot still to surface and for once, IW agrees with a government department.

Moving along, the EU is seemingly going to "get tough" with the (currently six) members that are exceeding their budget deficit limit (3% of GDP.) It will be interesting to see just what "getting tough" actually means, especially when the "six" number is found to be a tad on the low side......but far more importantly to many people, the head honcho of UEFA is suggesting that "football could financially implode". Gosh - it's good it's only financially. It would take a fair old effort to implode a football.......

Speaking of agreeing with a government department, it was pleasant indeed to hear the words of the EU "competition commissioner" when she suggested during the week that it would be a good idea to let the worst of the "toxic waste burdened" banks fail in order to let "smaller, leaner ones" emerge. She also suggested that all banks be forced to disclose ALL their toxic commitments, and that NO mergers be permitted. In her words, "Two turkeys do not make an eagle" - a brilliant way to put it, Madam.

On to scams - and as well as the Stanford one mentioned above, it seems retired senior police people are doing pretty well via their nice wee ACPO criminal records business and how much the taxpayer has to shell out for the information. Then there's the ongoing Jacqui Smith thing re her expenses - seemingly "public anger" has caused a U - turn on the part of the relevant investigator and he's "looking into the matter". Possibly that will be while wearing mirror sunglasses in a very dark room, in return for a Sirhood in due course? We'll see! And ten Met cops have been suspended for alleged "mishandling of property". Whom can you trust these days, eh? Not that this guy ever trusted the polis of course. And seemingly £millions of aid money has "gone missing" in Afghanistan. Gosh, surely not?

Moving back to "matters economic" - poor old Starbucks is totally doomed now after the Prince of Darkness put his curse on their chief exec for having dared to tell the truth. And as for said prince's proclamation that "Britain is heading for a prosperous, low - carbon future" (Mandelson was speaking to "business leaders" at a rather unfortunate choice of venue) well, what can you say? The "low carbon country" that is going to build COAL fired power stations? What a complete idiot. (The venue was Sellafield, which of course IS "low carbon" in theory, but is being closed down because it is totally redundant and leaky - yet Broon's lot claim it's "worth £216m"....Gordy, could you please explain to this clearly arithmetically challenged person, just how an ongoing disaster like Sellafield, can be "worth" ANYTHING, unless on the "minus" side of the ledger?)

And while still in "rant mode" - all this garbage about giving people £2000 allowance to scrap their older car and buy a new one is just SO annoying. Yes, let's build a new car, using up even more resources, while masses of perfectly good used cars already exist. Why not give people £2000 towards the proper maintenance of their existing vehicle? IW would be right there, standing in line for the handout......ah, but that would be bad for the car manufacturers, who are already very deep in the smelly stuff. But it would be great news for mechanics! There's a silver lining wherever you look. Poor old Saab has gone bust - I used to have one of their cars - supposedly the "best seats of any car anywhere" according to the blurb at the time. Hmm - wonder what the worst seats would have been like then? It was a grossly overrated machine, uncomfortable, guaranteed car sickness for anyone travelling in the back, turbo lag, pretty much rubbish overall really. And a lot of BMW Mini workers certainly got "mini notice" during the week - one hour in fact. Very unpleasant. GM and Chrysler want the Obama one to give them $39bn - in return for axing another 47000 jobs....The head of Fiat reckons there will be only half a dozen car makers left in five years' time - it's fairly likely Fiat will be one of them, given the excellent product range they now have.

Finally - another scam? "Pre Pack Administration" sounds innocent enough to describe the situation where a struggling company comes to an arrangement with its creditors, to try to salvage as much as possible. However, what seems to happen is that "junior creditors" (the small ones, basically) lose everything, so that the bigger fish get to keep more. It was ever thus!
Oh yes, before I forget - speaking of "low carbon" and all the nonsense surrounding that idea (it's a great idea, don't get me wrong here - it's just not going to happen) NASA has launched a satellite at enormous expense to the US taxpayer, to "track carbon dioxide emissions". The idea is to see where the emissions are worst. A laudable idea IF anyone were going to do anything about it, but otherwise just another "sounds good" thing that is a total waste of money.

And Northern Wreck might be going to "re - enter the mortgage market".....at whose expense? Nae prizes for guessing, all ye happy UK taxpayers. Speaking of guessing, what about the wee conundrum that kicked off today's ramblings? How about one of Broon's financial law changing escapades (mentioned above) - the one that permitted the creation of REITs? (see last weekend's WICS regarding REITs and "rights issues" - taking money from one patsy, to pay some of it out to an earlier patsy.....work it out!).

Finally finally before we examine a couple of charts, here's a wee update to the email from "Mark" about gold, that was included in last weekend's WICS. Mark (perfectly understandably!) needed a bit more convincing and here's his second email and my reply. Just be very aware that this is ONLY my opinion and should be viewed entirely in that context:

"Ian, I take all your points on Gold , however, as USA is on the doorstep of massive quantitative easing with big inflation on the way and the bond market at very high levels, surely the usd will now weaken substantially and push Gold even higher? I promise this is my last ditch comment on Gold -is $650 still feasible? Mark."

My reply was:

"Mark - yes, I still reckon $650. The Yanks can do as they wish re "easing" but they won't create inflation - at least not yet. As before, asset prices will keep falling & that has to include gold. Bonds too are going to fall in price, because of the rising default risk that needs higher interest thereon for people to want to buy them. And as "investments" denominated in USD disappear the world over, via bankruptcies/falling values etc etc, those USD that remain, will be worth more, not less - because there will be fewer of them. As mentioned before however, inflation WILL return - but not before an awful lot of deflation has happened first. Once the "bottom" has been reached, I assure you I'll be looking at buying gold, but right now, with DSI showing 94% gold bulls, it certainly looks like a "sell" to me, although it could still see a crazy runup to $1000 first of all. (That should NOT be taken as financial advice, as I'm sure you realise. All my comments are my opinion only.) Ian."

OK - charts! First tonight we'll take a look at Tate & Lyle, last featured in video clip 1988 on January 7th this year. (That clip is now in the "publicly viewable" section of the website, by the way, for another week.) It has followed the "triangle break" script pretty well, and it's good to note how many of you had it on your "watch list" - it's also the case that there was a nice "double up" opportunity when it broke its horizontal support the other day. And did it become a "windfall" on Friday? Then we'll look at another windfall on the Land Securities chart - one of these REITs mentioned above, and in last weekend's ramblings. Next we'll look at Forth Ports - it has been on the "watch list" for quite a few of you, and indeed has provided some pretty good "sell" trades this past while. Will it break current support after its "false" triangle breakout and subsequent fall? Or will it form a horizontal channel? Finally, there's an update of last weekend's comments about the Nasdaq triangle. And yes, I know we're looking at potential sells on all these charts - but recently - both in WICS and the videos, surely there have also been some potential buys mentioned? - so don't give me a hard time about that, please!

On that note, have a great week and I'll see you again next Sunday as usual.

Ian.

'IMPORTANT NOTICE: These WICS charts are for EDUCATIONAL PURPOSES ONLY. They represent only MY understanding of what is happening in the market for any particular share, stock, commodity or index. In NO circumstances should they be construed as recommendations to trade. If I choose to trade what I see, that is MY decision. YOU must, in turn, come to YOUR OWN conclusions about what action, if any, YOU might choose to take'.