We will soon be rid of Senators Dodd and Barney Frank who along with Senator Obama created the current world crisis.

Let us not forget that Senators Dodd and Barney Frank created the real estate crisis by calling it “racist redlining” and discrimination against Obama’s race if lenders asked mortgage applicants if they had a source of legal income and if they could afford to make the mortgage payments on the house they wanted Uncle Sam to buy for them. Barnie will now join Dodd and not run again for Senate.

Let us not forget that before the “Dodd Frank phony mortgages” brought on the collapse of the American economy, Senator Obama became the first American politician in the history of America to be so stupid and malicious as to declare that the USA was in a depression and Senator Dodd quickly created a run on the first California Bank since the Great Depression by revealing secret Senate Banking Committee information about the bank’s lack of liquidity.

We will soon be rid of Senators Dodd and Barney Frank who along with Senator Obama created the current world crisis. We can only hope that Obama will step down soon and give America a chance to get back on track.

“Screw the taxpayers to buy the corrupt politicians,” is Obama’s campaign contribution slogan. This racket is going on in every single State that allows collective state employee bargaining with leftist arbitration of disagreements. No wonder Obama wants card check like they invented in the USSR. Only in the USSR the corrupt workers party carried red flags not union cards and the honest workers were sent to Siberia. Communism is still the goal of the banana republic tag team of Hugo Chavez and Obama. Now the State of Wisconsin is free to put the insurance contract out for bids and behold, they have saved so much money it has turned deficits into surpluses. As a result, none of the teachers had to be laid off, everyone got a raise, etc., etc., and the taxpayers of Wisconsin don't have to pay more taxes to fund the corrupt socialist push to take away American liberties such as our right to keep the fruits of our labor.

Machinists asked the National Labor Relations Board to drop a complaint against the Boeing Co. (BA) after union members approved a new contract that increases production in Seattle and averts the risk of a third straight strike. Obama is now destroying America’s ability to compete in all the aerospace markets. The EU, China, and Russia are doing well under Obama’s aerospace dictatorship.

Obama does not realize that what the EU is going through is what Obama is setting the USA up to go through in about 7 years and that is to default on debt and hurt everyone who owns US Treasuries with a 50% haircut. The USA needs to throw out the socialist Democrats who believe in spending beyond our means on giving welfare instead of an education in American work ethics.

World markets
The price of gold and the Euro fell the most in two weeks versus the dollar as Moody’s Investors Service said it will review the ratings of European Union nations after last week’s summit failed to produce an meaningful steps to end the EU debt crisis.

India’s industrial output shrank for the first time in 28 months, pushing stocks and the rupee lower on concern faltering growth will force the central bank to suspend its fight against India’s highest inflation of the BRIC nations.
Production at factories, utilities and mines fell 5.1 percent from a year earlier in October.

China’s economy, the second largest after the USA, is cooling as their exports weaken and the Communist government cracks down on property speculation, banking irregularities and political corruption. Growth in bulk shipments in November was down and still at less than 20% of levels during their economic boom. Customs data released on Dec. 10 showed that when seasonal distortions are removed the Chinese trade surplus shrank from a year earlier.

Bundesbank President Jens Weidmann told the Frankfurter Allgemeine Sonntagszeitung that governments must resolve the debt crisis, rather than the Frankfurt-based ECB. Germany’s top central banker added that the new accord on budget rules represents some progress. “The mandate for redistributing taxpayer money among member states clearly does not lie in monetary policy,” Weidmann said in an interview published yesterday that, “Financing of sovereign debt through central banks is and remains forbidden by treaty.” In the USA it is done through higher Federal taxation of the rich states followed by Federal investment in military bases, NASA, and national defense industries in the poor south and rich Texas.

Brazil cut their 2012 economic forecast for the benchmark interest rate for the second straight week on expectations of slower growth in the wake of the EU’s worsening debt crisis.

World markets are failing to break out some on the second and third times at resistance levels.
http://finance.yahoo.com/intlindices?e=asia

China testing recent lows. http://finance.yahoo.com/echarts?s=000001.SS+Interactive#chart1:symbol=000001.ss;range=2y;indicator=ema(200,100)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

Germany testing resistance level: Choose 2 or 5 years
http://finance.yahoo.com/echarts?s=%5EGDAXI+Interactive#chart2:symbol=^gdaxi;range=2y;indicator=ema(200,100)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on

The Swiss testing resistance level. Choose 2 or 5 years http://finance.yahoo.com/echarts?s=%5ESSMI+Interactive#chart1:symbol=^ssmi;range=2y;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

Emerging markets triple bounce but still testing resistance level.
http://finance.yahoo.com/echarts?s=^BVSP+Interactive#chart1:symbol=^bvsp;range=2y;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefine

American Economy
The US economy may not dip as Americans increasingly hope that the Obama Regime will be thrown out of office so Americans can change back to an honest free enterprise system.

Last week

The good
Initial Claims 12/03 381K down from 402K
Continuing Claims 11/26 3583K down from 3740K as unemployment checks expire after two years. I never believed most of the USSR’s economic reports either. Obama’s socialist union supporters still refuse to allow unemployed Americans to take community service jobs that allow them to earn a minimum wage. The socialist unions say it destroys the welfare state voting block to put them back in the work force the way Gingrich and Clinton did under 1995 welfare reform. Remember the Obama administration’s communist slogan, “Every crisis is an opportunity to advance the welfare state.”
Mich Sentiment Dec 67.7 up from 64.1 last month

The bad
Wholesale Inventories Oct rose 1.6% after declining -0.1% … very bad!
Trade Balance Oct -$43.5B slightly worse than last months-$43.1B

Today
Dec 12 2:00 PM Treasury Budget Nov
This Week
Dec 13 8:30 AM Retail Sales Nov
Dec 13 8:30 AM Retail Sales ex-auto Nov
Dec 13 10:00 AM Business Inventories Oct
Dec 13 2:15 PM FOMC Rate Decision Dec
Dec 14 7:00 AM MBA Mortgage Index 12/10
Dec 14 8:30 AM Export Prices ex-ag. Nov
Dec 14 8:30 AM Import Prices ex-oil Nov
Dec 14 10:30 AM Crude Inventories 12/10
Dec 15 8:30 AM Initial Claims 12/10
Dec 15 8:30 AM Continuing Claims 12/03
Dec 15 8:30 AM PPI Nov
Dec 15 8:30 AM Core PPI Nov
Dec 15 8:30 AM Empire Manufacturing Dec
Dec 15 8:30 AM Current Account Balance Q3
Dec 15 9:00 AM Net Long-Term TIC Flows Oct
Dec 15 9:15 AM Industrial Production Nov
Dec 15 9:15 AM Capacity Utilization Nov
Dec 15 10:00 AM Philadelphia Fed Dec
Dec 16 8:30 AM CPI Nov
Dec 16 8:30 AM Core CPI Nov


Market outlook December 12, 2011

Stocks still fail to break out of recent highs. Where is the breakout and short squeeze? The US and the world economy may not slip back into a recession in spite of Obama incompetence, but that is starting to look less likely. Shareholders may want to get out before January if a rally does not break current resistance levels.

Real estate has possibly turned the corner but will not take off until Americans are confident that Obama and his leftist supporters will be thrown out of office or even later if he is re-elected.
http://www.martincapital.com/index.php?page=graph&view=permits_and_construction

When it comes to jobs, Obama has to manipulate the government statistics just like all USSR did to pretend things are better.
http://www.martincapital.com/index.php?page=graph&view=unemployment

We are at the critical upside resistance level now and it needs a breakout so the advance resumes and triggers a short squeeze that could rum stocks up close to previous highs of this year. If the rally occurs, then in a moth or two that will be the time to get back into cash. Complacency has not set in at all yet. There is still just not much short seller fear at this point. Look how low the VIX has to go before the market top is hit! A level as low as 20 would indicate complacency and the end of the bull market.
http://finance.yahoo.com/q/bc?s=%5EVIX&t=6m&l=on&z=m&q=l&c=

We advanced once over 60% of the total recent decline and predict we could possibly have as much as 95% recovery. Market Vector agrees with us. But realize that as the upside potential is approached, then the downside risk exceeds the upside potential and it is time to lighten up. View 6 mos. See: http://finance.yahoo.com/echarts?s=^NYA+Interactive#chart1:symbol=^nya;range=6m;indicator=ema(200,100)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

We are still at less than 20% of the bulk trade level that existed before Obama declared the USA was in a depression in one of his campaign speeches. Obama and Dodd caused the fear that triggered the bank run. Insert into explorer and look at the 5yr trend at the bottom of the page.
http://www.bloomberg.com/apps/quote?ticker=BDIY:IND

Stock market update:
Asian Stock markets were mixed last night. China down -1%, Hong Kong down –0.1%, India down –2.1%, S. Korea up 1.3% and Japan up 1.4%.

European markets are down today in a range –1.7% to +0.2% half way through their day.

American market futures are down about -0.7% at 7:00 AM EST. It is an unreliable predictor.