The real turnaround is just beginning.

Market Outlook
For many months Jim Cramer has said China was driving the world economy. He said the Baltic Dry index was strong and investors should buy is favorite dry cargo and copper mining stocks. He was wrong but finally he is right. The Baltic Dry index has finally turned upward. As they say Jim did not know what he was talking about but it did not matter because the stock market rallied and once again is a six month leading indicator and lead the Baltic Dry index by six months.
http://www.bloomberg.com/apps/cbuilder?ticker1=BDIY%3AIND

For many months Jim Cramer has been advocating Natural Gas stocks. But NG stocks went nowhere. He was off again but natural gas prices have finally begun to increase so perhaps NG stock prices will also begin to rise.
http://www.tfc-charts.w2d.com/chart/QG/W

The USA balance of trade has begun recovering. That is a benefit of the recent decline in the dollar. Foreighn central banks flush with record reserves are increasingly selling $Dollars in favor of the Euro and Yen, further pressuring the greenback after its biggest rout in almost two decades. But investors outside the U.S. are purchasing companies in the Standard & Poor’s 500 Index at the cheapest valuations on record, their buying power boosted by a seven-month decline in the dollar.
http://www.martincapital.com/chart-pgs/Pg_baltr.htm

Retail sales are finally recovering
http://www.martincapital.com/chart-pgs/Pg_sales.htm

There stands to be a lot of good news coming out now and even unemployment should begin to level out. However banks are only beginning to see the problems in the housing and commercial real estate markets. With the exception of banking the economy appears to be on the road to recovery. We don't expect the Treasury or the FED to allow another serious banking crisis but the banks still look overvalued at this point and may consolidate while other stocks catch up before the banks resume their recovery.

The only thing we have to fear are the corrupt socialists who hijacked the American government and hold working people and pensioners hostage.


Market forces October 12

American government is declining with wholesale socialist corruption of American economics and foreign policy and now the tyrannical attacks on the free speech of financial and political dissidents. We have growing world chaos similar to what preceded WWII. The Obama administration is seemingly creating the second Great Depression before our eyes and setting America up for another Pearl Harbor type sneak attack by terrorists.

Still this is no time to hide money under the bed or in bonds, the money market, or treasuries. Rising inflation will initially crush bonds and devalue currency. The time to go into bonds and money markets is when inflation peaks and the FED is still raising rates. That may not even start to happen in the next year and the peak inflation rate could be as late as ten years away. We continue to invest in sector stocks that are down but rotating back into favor and then take profits on their short run-ups that sometimes only last a week before they tumble again. It is better to take 8% every month than 20% over a year. While this year is an exception, 10% a year is on average about the best buy-and-hold can achieve.

Asian markets were mixed last night; China declined -0.6%, Hong Kong declined -0.9%, India up 2.3%, Japan closed, and Taiwan up 0.4%.

European markets are down in a range from 1.1% to 1.4% this morning about half way through their day.

US pre-market futures are up today by about 0.5% at 9:00 AM EST

Advances in science and the 2010 election will be necessary to pull America out of this administration's corrupting socialist quick sand.