Happy New Year

Late posting today

World Outlook
Britain will tax the obscene bonuses the bakers paid themselves this year.

Market Outlook:
The U.S. Treasury Department said today it would remove the caps on assistance to Fannie Mae and Freddie Mac for the next three years to alleviate market concern about the effect of a double dip recession and new record foreclosures. The two government bureaucracies have been noted for corruption and waste. They are the largest sources of mortgage zero down financing in the U.S. for inner city housing scams. Previously the taxpayers were only liable for caps of $200 billion each in backstop capital from the Treasury. Under the new agreement, these caps can rise as needed to cover net continued use of scams involving "the don't ask if they don't tell" policy Senator's Rangle and Dodd still not stopped. Fannie Mae and Freddie Mac have already given away $111 billion in assistance to people who should not have been permitted to purchase real estate. Another market panic could occur at any time. The Wall Street Journal today showed the history of the DOW with and without adjustment for inflation. The current malaise began during Bill Clinton's last term and shows no sign of abatement.

Seasonal retail sales are up 3.6% and newly unemployed were down slightly.

This Week
Monday, Dec. 28
Treasury bill auctions

Tuesday, Dec. 29
Consumer Confidence

Wednesday, Dec 30
Chicago PMI
New Home Sales

Thursday, Dec. 31
Unemployment Claims

Friday, Jan.1:
Markets closed for New Year's Day


Market forces December 28

We estimate the NYSE must still rise 2.73% from friday's close to be interpreted as a continuing rally not a declining head and shoulder sell signal. That reflects both the price change and volume of shares being traded. However the Spiral (Parabolic SAR) indicator and the MACD are now more optimistic.

Asian markets were up over night; China up 1.5%, Hong Kong down -0.2%, India holiday, and Japan up 1.3%.

European markets are up with the average in a range from 5% to 0.7% this morning about half way through their day.

US pre-market futures up by about 0.4% today at 8:30 AM EST.

We are preparing for a possible market decline in early 2010 that could take prices down to the high where they were at the end of May seven months ago.