Bernacke/Obama want America to walk into the Japanese low interest trap of perpetual recession and economic stupidity.

AM Radio Stations will be forced out of business by high levels of interference mostly from power lines but also new sources. We are filling our world with microwaves so children can spend their money on game applications and other cool stuff that is creating a school system of dunces taught by the dunces of the last generation. Apple’s stock is now valued higher that the rest of the world’s stocks, (put together) outside of the stocks traded in America. And apple is rich primarily due to the addictions of novelty and games. Having an Apple product has become a status symbol among young and old dependents in the ever-growing world of dunces who will need the government to take care of them.

Character and values are no longer taught in our schools. A child’s character is 90% determined before they enter high school and by the 6th grade for the best and brightest students. Good character traits (virtues) were behaviors like being responsible, hard-working, conscientious, honest, dependable, prudent, respectful, considerate, fair, diligent, confident, reliable, responsive, trustworthy, and decisive. Developing a student with personal character, people skills, and leadership skills (virtues) was thought to be teaching students to take care of themselves. The education of the Founding Fathers focused on the highest human traits and with those traits the student could do anything and each one could educate his or herself. Today High School students must know more than their teachers because most teachers are such open minded leftists, their brains fell out long ago.

NASDAQ 100 Undertakes ‘rare’ rebalancing. This is called fraudulent market appreciation 101, the way all long term stock indices are doctored to deceive investors into thinking stocks do much better than is the actual case. When a stock has a big run-up the index is very high but is at a high risk of losing that gain when that over inflated stock goes back down. So what they do is they add rising stocks and remove stagnating companies before they decline. Apple is so high and still rising and they do not want the risk of seeing the index go back down.
What do they do? The WSJ says that the Nasdaq is reducing the weighting of Apple in a “rare rebalancing” of the Nasdaq 100 Index. To do that they effectively raise all the other stock values with a multiplier while cutting the apple share weighting multiplier. Yes, they rebalance by raising the values of the weak (using the weighting to hide it) so when apple drops in percent of the index, the index does not decline. It is indeed outright fraud and the SEC has been letting them do it. Later they will claim a 7% annual market gain since 1945 when without the legal fraud it would be about 4%. It is false advertising and investors need to be aware that the stock market is no more truthful than a used car dealership.

Bernacke/Obama want America to walk into the Japanese low interest trap of perpetual recession and economic stupidity.
 It starts by spending the nation’s way into debt until as in Japan the debt exceeds the national income and it is impossible to pay down without national pain.
 That spending spree is only possible by keeping the interest rate close to zero as they do in Japan where the people’s savings are taken by their government and the people get paid next to nothing in interest.
 Eventually the debt is so large the government is trapped and has to avoid higher interest rates because it cannot afford that annual cost of the interest.
 This makes an extremely unstable situation and if the Japanese were to stop saving and buy assets instead, the interest rate would soar and the value of the yen would plummet.
 Obama socialists must be ejected along with the other socialists before the socialists give us perpetual economic recession as the communist Eastern Block had before they went bankrupt. The Japanese socialists have had a recession for 30 years now.
 The Treasury Department predicts the U.S. will hit its $14.294 trillion debt limit no later than May 16. Government could already begin to shut down this weekend.

If Japan’s interest rate rises just 0.2% on their national debt then 70% of their national income would go just to paying the interest on their national debt.
A shortage of parts from disaster-ridden Japan is very likely to force Toyota to shut down its North American factories and impact roughly 25,000 workers. It’s not clear how long Toyota will be forced to close its facilities.

Warren Buffet is depicted was having become irrational and mentally unstable on GE/MSNBC/Pravda.

Portuguese bonds fell and the cost of insuring the nation’s debt rose to a record and the Euro weakened after Moody’s Investors Service said a bailout is inevitable. The interest Portugal pays on 10-year bonds climbed to 8.76%. Moody’s cut its rating on Portugal’s debt for the second time in three weeks, saying another downgrade may follow and the winner of elections in June will probably tap Europe’s bailout fund with “urgency.” The downgrade “is further evidence of the sovereign decay in the area. The European Central Bank will probably raise interest rates this week to contain inflation.


US Auto & Lt Truck Salesfor March are a week overdue as rumors of a slowdown loom due to Japanese parts shortages. Obama does not want to release the disappointing numbers.
A US government shutdown is looming.
Oil just hit a 30-Month High.


World Markets:
Ireland's ratings were lowered again.

China's stock market prices are in a triangle formation and will breakout probably within a week. At this point we believe the breakout will be down because most of the world is tightening belts now and letting interest rats rise to slow demand for debt. Higher rates will put extreme pressure on countries like the "PIIGS", Portugal, Ireland, Iceland, Greece, and Spain that have done little to balance their budgets. Spain will be the next to fall and socialist unions may riot. The contagion is spreading in the EU. Japan is now a walking debt ridden economic zombie because they took the communist position that everyone should be given a job for life. Unfortunately that leads to nuclear reactors and aircraft problems that kill people because there is no incentive to do a good job when the job is guaranteed.

US Market Highlights

Latest reports
IS Manufacturing Index Mar dropped to 61.2.from 61.4
Construction Spending Feb fell -1.4% or -2.5% depending on whether last -0.7% or the manipulated -1.8% is correct. When the numbers look bad and they take spending numbers they receive and move them backward that is corruption because in another week they will have to adjust the present numbers as well. Either always compare final numbers a week later or compare them at the end of the month. They do but not and could have a 5-wk interval last month and a 3 or 4 week interval this month.
Auto and truck sales still not being reported.

Yesterday
ISM Services industry index fell to 57.3 from 59.7
Fed Minutes indicate the FED is continuing down the path Japan took to perpetual socialist style perpetual economic depression.
MBA Mortgage Index 04/01 fell again -2.0% after falling -7.5% last month as housing is in a full double downturn.
Crude Inventories 04/02 rose 1.952M after rising last month in spite of the highest April gasoline prices in the history of America. The last time that happened the economy was in a state of free-fall by the end of the year.

This week
Apr 07 08:30 Initial Claims
Apr 07 08:30 Continuing Claims
Apr 07 15:00 Consumer Credit
Apr 08 10:00 Wholesale

Market Outlook April 7, 2011

The world markets are now holding their breath waiting to see if the markets plunge as the Obama socialists follow the Japanese socialist plan which is government spending into a PIIGS type oblivion while Germany and Britain are belt tightening their governments and raising interest rates so that money has some value. If the Republicans back down on their miniscule government cut the world thinks it is doomed to perpetual socialist self indulgent stupidity like we see in the Greek union riots.
The stock market is continuing to test its head and shoulders now. The markets all appear to be topping out. To us it looks like the 47dma is no longer a support level but instead has become the resistance level for a topping trend (head and shoulders) line.

S&P
http://finance.yahoo.com/q/ta?s=%5EGSPC&t=1y&l=on&z=m&q=l&p=m50&a=m26-12-9&c=

We think the next stock market support level will be down at Nov 4, 2010 levels.

We need to warn you now to liquidate gold and silver when it has run up, not after it drops quickly back to about $400 and $8 respectively.

The success of President Ronald Reagan was due to his selection of intelligent advisors not socialists and gold fell rapidly from $800/oz to $200/ox and stayed very low for almost 20 years. Silver fell back then to $3/oz. President Reagan was a supply-side advocate and ended the artificial shortages that president Jimmy caused in everything from toilet paper, gasoline, silver, and gold.


World Markets
International trade shows that the world economy has only revived about 25% not the 60% shown by the stock and commodities markets. That means more than half of the stock market rise from the 2009 lows is unsupportable and could evaporate. See:
http://www.bloomberg.com/apps/quote?ticker=BDIY:IND


Asia seems to be waiting to see if the market breaks up or breaks down at this resistance point.
Asian markets were flat last night. China up 0.1%, Hong Kong down -0.1%, India down –0.1%, and Japan up 0.1%.

European markets are flat this morning in a range of about -0.2% to 0.2% half way through their day.

US pre-market futures are flat at about -0.1 % at 7:00 AM EST.