Silent night and a merry Christmas

The holiday season brings a calming effect to the financial markets and the world of good and rational people.

World Outlook
The struggle between world good and evil continues as the US Senate is expected to pass another insidious health care bill on the eve of Christmas. This type of evil is hardly noticeable to Chinese, Russia, or Japanese cultures. Homogeneous nations where the people share the same values are less likely to see segments of the population misuse government social and health services. The evil is only slightly noticeable in European and British cultures. But the injustice and evil is clear to every rational person in America because America is a conglomeration of very diverse cultures.

In American we have Moslems with strong work ethics who happen to hate Christians, Jews, Buddhists, Hindus (all other religions and western culture to boot) to such an extent that they travel to Pakistan to be trained to kill other Americans.

In America we have destitute illiterates from Haiti and other places that come from hell holes that lack work ethics and have drug and crime cultures. Third world work ethics are virtually "don't worry be happy type" dysfunctional work ethics that produce extreme poverty.

From Mexico we are invaded by drug cartels that have even been discovered growing illegal cocaine and marijuana in America's national forests!

In America we have South Americans who refuse to assimilate or even speak the national language that was once established to be English. This means that gradually the Americans who love America and have a strong work ethic are becoming a minority.

Capable Americans who happen to hate America's culture have united with dysfunctional Americans who hate America's work ethic and together they are becoming a voting majority. They love government handouts and free government services and they are turning America into a dysfunctional socialist third world country. They voted in a veto proof democrat-socialist president and congress for the first time in American history and America under their leadership is making great strides towards becoming a self loathing, fractious, banana republic ripe with government tyranny, corruption, and totalitarianism.

Happy Holidays!

Market Outlook:
This Week
Monday, the Treasury Department auctioned $30 billion in three-month bills at a discount rate of 0.070 percent, up from 0.040 percent last week. An additional $31 billion in six-month bills was auctioned at a discount rate of 0.170 percent, up from 0.160 percent last week. The three-month rate and six-month rate were the highest since October when the amounts auctioned were greater. The Fed held its final meeting of the year last week and once again voted to keep its target range for its bank lending rate at zero to 0.25 percent, where it's stood since last December.
Home resales rose by 7.4% to a 6.54 million annual rate from 6.09 million in October, the National Association of Realtors said Tuesday.

Inventories kept shrinking. Prices fell -- but the decline was the smallest in two years.

Economists surveyed by Dow Jones Newswires expected a 3.3% increase in sales during November, to a rate of 6.30 million.

The report Tuesday was another positive for the housing market, recovering from a big bust. Year over year, resales were 44.1% higher last month than the level in November 2008. October existing-home sales rose a revised 9.9%; originally, NAR said sales surged 10.1%.

The average 30-year mortgage rate was 4.88% in November, down from 4.95% in October, Freddie Mac data showed. The NAR reported the median price for an existing home last month was $172,600, down 4.3% from $180,300 in November 2008. The decline was the smallest since a 4.1% drop in November 2007.

Inventories of previously owned homes decreased by 1.3% at the end of November to 3.52 million available for sale.

The US economy limped forward at a 2.2 percent pace in the third quarter, according to government figures Tuesday that showed a downward revision of gross domestic product (GDP). This is the second Obama government revision from the original Obama bogus 3.5% rate.

Corporate profits in the third quarter were revised down but were still up from the second quarter. Corporate profits were revised to $1.174 trillion from the earlier estimate of $1.181 trillion annualized. Profits in the third quarter were up 68.0 percent from a year earlier.

Sales of existing homes grew 7.4% in November compared with 10% in October to an annualized rate of 6.54 million units, according to the National Association of Realtors.

The University of Michigan/Reuters consumer sentiment index rose 0.2% in October, marking the first increase since August 2008. Consumer Income increased modestly.

The seasonally adjusted annual rate of new home sales plummeted 11.3% to 355,000 in November compared to the prior month, a Census Bureau report said Wednesday.

California Governor Arnold Schwarzenegger wants President Barack Obama to bail out their anticipated $21 billion deficit.

Thursday, Dec. 24:
U.S. Market closes early
Unemployment Claims
Durable Goods Orders

Friday, Dec. 25:
Merry Christmas!

Market forces December 24

We estimate the NYSE must still rise 3% from yesterday'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 2.6%, Hong Kong up 0.9%, India up 0.8%, and Japan up 1.5%.

European markets are up with the average in a range from 0% to 0.6% this morning about half way through their day.

US pre-market futures up by about 0.2% 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.