Greek socialism failed and now they want international socialism i.e. communism.

Greek socialism failed and now they want international socialism i.e. communism.

Socialism in Greece has brought the normal socialist economic equality called, "universal poverty." This is the same Greece that was once a world learning center and had the first city to experiment with democracy. But they have become socialist parasites selling bonds to the rest of the world and refusing to live within their means. They apparently want international socialism so they can suck the life out of the stronger European nations and eventually out of America. But with Obama socialists and his 10$trillion deficit to help socialists who have no work ethic, there soon will be no life in the USA to suck out. Obama the socialist will bankrupt America.

Where has the stimulus package gone? Apparently it went down Obama's socialist toilet bowl. Obama is no intellectual. His mind is a socialist toilet bowl like every street thug who thinks he is owed something from society. Our money goes to people whose life style does not include working for a living or even learning foreign languages such as English.

According to Obama, everyone has a right to a house, a car, a wide screen plasma TV, and a welfare check. That is just their life style and we have to accept their socialist life style and give them entitlements that increase every year.

Obama thinks some people have stupid out-dated life styles. Life styles socialists think are out-dated include engaging in difficult educational studies, those that include a work ethic, and those that put children ahead of selfishness, drugs, and self-gratification. If street socialists put their children first then we would have all self-sufficient adults who could speak our language.

Any person who demanded citizenship in Spain or Mexico while refusing to speak Spanish would be seriously insulting Mexicans and Spaniards. Yet democrat-socialist think it is ok to have American citizenship without knowing our language. To socialists around the world it is delightful that so many Americans are still willing to be the slaves of socialism around the world.

As we have been saying:
Beware now of emerging countries and their stocks and bonds. Chinese corporations are beginning to default en-masse on foreigners. The communists can be expected to sting American investors in a professional manner that will cause investment losses two to three times more than their indices indicate. In other words GE/MSNBC/Pravda will once again lie to investors and the pain investors feel will be at least twice what the media reports. Out of the huge investment losses a Chinese tier stock structure will likely evolve with the main indices likely to survive as the Dow's of China while up to 30% of the Chinese firms (mostly over capitalized) can be expected to fail.

Also there are many emerging nations in far worse financial trouble than Greece that are still selling low yield bonds to Americans. When the Russian bubble broke in the 90's and they defaulted, it brought down many hedge funds. So beware because China could eventually default. In fact, considering that they are communist we can expect them to default the moment they have extracted what they want from us.

Economic Calendar
Earlier this week
Consumer Income & Spending: Personal income in March rose 0.3 percent, but consumer spending rose by 0.6 percent. With the unemployment rate, stubbornly at 9.7 percent, forecasters expect unemployment to remain near 10 percent through at least the remainder of this year. That means that if the recovery is to continue, it will have to be largely based on consumption, not new employment. But if consumer spending continues to increase faster than personal income that would suggest that people are once again going into debt. Indeed, the personal saving rate dropped from 3 percent to 2.7 percent, hitting its lowest rate since September 2008. Economists therefore worry that the gains in consumer spending and therefore a recovery are not sustainable while unemployment remains high.

ISM Manufacturing Index: The ISM Manufacturing Index increased to 60.4 in April, from 59.6 in March. With this index 50 is economic stagnation, less than 50 is economic contraction and greater than 50 is expansion in manufacturing. While the index indicated growth for the 12th consecutive month in the overall economy, as well as expansion in the manufacturing sector for the ninth consecutive month we are still well below where we were in 2007.

Construction Spending: Construction Spending increased by 0.2% to $847.3 billion during March after falling by 2.1% in February, revised downward from a previously estimated decrease of 1.3%. Without that after-the-fact 0.9% downward revision the current figure would be down 0.7% not up 0.2%. Note that the revision is four times bigger than the reported change and makes the reported number completely statistically meaningless. Revising figures downward after they are reported is one way politicians manipulate data to make the next month look better without the American public knowing it was political manipulation. Year over year, construction spending has declined by 12.3% from the March 2009 estimate. The housing peak was in 2006.

Auto Sales were up 20% from a year ago when they were in bankruptcy but down 9% from March 2010.

Factory Orders: Total factory orders, that is with non-durables and durables combined, rose 1.3 percent, the same as for February. This is truly good and not just hype.

Housing stocks have been hyped to record highs. Pending sales of previously owned homes hit a hyped five-month high in March as buyers rushed to sign contracts before a tax credit expired. That five-month hyped high is actually a double dip. See:
http://www.martincapital.com/chart-pgs/Pg_existinghms.htm

Yesterday:
ADP employment report showed a 32,000 increase in private sector jobs during April. This is very good but statistically meaningless news even if it is true and not revised down later. Of course about 500,000 new people look for jobs each month and there is 10% unemployment. ISM’s Non-Manufacturing Employment Index for April registered 49.5 percent. This reflects a decrease of 0.3 percentage point when compared to the 49.8 percent registered in March.

ISM non-manufacturing Index: Anthony Nieves, C.P.M., CFPM, chair of the Institute for Supply Management™ Non-Manufacturing Business Survey Committee; and senior vice president — supply management for Hilton Worldwide. “The NMI (Non-Manufacturing Index) registered 55.4 percent in April, the same percentage as registered in March, and indicating growth in the non-manufacturing sector. The Non-Manufacturing Business Activity Index increased 0.3 percentage point to 60.3 percent, reflecting growth for the fifth consecutive month. The New Orders Index decreased 4.1 percentage points to 58.2 percent, and the Employment Index decreased 0.3 percentage point to 49.5 percent.” That seems to contract the favorable ADP employment report.


Thursday, May 6:
Unemployment claims
Productivity

Friday, May 6:
Employment Report
Unemployment rate,
Consumer Credit


Market Outlook May 6, 2010
Volume surged another 4% higher as the markets dropped more yesterday. The market manipulators still spin the economic news but are getting a little frightened now. The volume-adjusted NYSE is getting close to breaking the first head-and-shoulder neckline. Note that the neckline is the next resistance point. The second volume-adjusted neckline is a little lower than the first. We are now looking to see if the volume adjusted necklines will hold. It can be assumed that the market manipulators will hold the raw index necklines to make investors complacent. If our volume-adjusted neckline breaks down then the highs for this year 2010 may already have been established. The smart investors would be about 50% short and 50% in cash and holding. It is too risky to start shorting now. A few weeks of exhaustion of buyers could re-establish market health and present new buy opportunities later this year. Only time will tell. The coming correction will likely be the most severe correction of the past 12 months.

World Markets
Asian markets were down much lower last night; Shanghai down 4.1%, Hong Kong down -1%, India down -0.6%, S. Korea down -2%, Taiwan down -1.5%, and Japan down -3.3%. Communist China is about to see a surge in defaults and bankruptcies that will cost foreign investors dearly. We are avoiding all the emerging markets of the world.

After losses yesterday, European markets are flat today in the range from -0.3% to -0.6% this morning about half way through their day.

US pre-market futures are too manipulated to be useful today. They are attempting now to calm the US markets but that will make the losses worse later. While smart investors are in cash or short positions the market is extremely volatile so inexperienced investors should remain at a distance. If the second (volume adjusted) neckline holds then we are about 50% done with this correction. We do not expect that the adjusted neckline will hold but if the unadjusted headlines hold there likely will be a dead cat bounce of a week or more.

John P. Hussman, Ph.D. this week says:
"Over the past few months, the stock market has been characterized by an overvalued, overbought, overbullish, rising yields syndrome that has historically proved unrewarding and often particularly dangerous for investors. It's important to underscore that even in post-war data, and even if we assume that the economy is in a typical post-war recovery, this particular syndrome has been unrewarding, on average,"

This week by Streetsmart's Sy Harding:
Reported:
That the broader NYSE failed to break above its 21 day moving average last week.
That the rising U.S. market (previous weeks) was diverging with the collapsing global markets.
Global government debt issues are coming home to roost!