The US markets are likely to fall like a knife for at least a month with the coming worst quarter in a few years. Plus, the better Obama does in the polls the more the market will fall because intelligent people are not investing while Obama squanders America’s wealth. If Obama is re-elected we predict a full-blown depression. Right now it is a dead heat.

Obama’s January military cutback will eliminate 1.5 million more jobs beginning in January. The cuts are about $1Trillion or twice what the Pentagon said was reasonable. Unfortunately they have funds being sequested as well as the cutbacks they had planned on. More than half the losses are civilian jobs.


Wall Street banks are increasingly choosing to hoard their U.S. bonds rather than sell them to the Federal Reserve as speculation grows that a slowing economy and global financial crisis will only make them more valuable. And when rates are small the %profit change is larger. The world’s biggest bond dealers offered an average of $7.2 billion in Treasuries a day to the central bank in June, down 40.5 percent from a high of $12.1 billion in October. While the amount of marketable U.S. government debt outstanding has risen to more than $10.5 trillion, Treasuries are in demand in a world where five nations in Europe have already had one or more bailouts, the U.S. economy is slowing and China is weakening.

Obama’s ignorance of the power of the work ethic is now destroying world financial markets. Prosperity is not possible without a work ethic. An Obama free lunch for everyone who votes for Obama, paid for by those with a work ethic only encourages entrepreneurs to shrug the socialists off and to go on holiday. It is not possible to get America and Europe working again when Obama is taking everything our unborn children could ever have in the future and is giving it to lazy socialists so that they will lay complacent on the beach and vote for Obama in November. Voting for socialism is voting for future world starvation. Every starving nation has had a form of a socialist confiscatory government and it is no coincidence they have starvation. Eastern Europe fell under the USSR in 1945 and they and the USSR were starving by 1989 when the Berlin Wall came down. Greece, Ireland, Iceland, Spain, and Italy can now be considered to be socialist and are in rapid decline.  If they do not change they will have a "lost generation."

Informatica Corp. slumped 35 percent Friday, the biggest intraday decrease since July 2001 after the provider of data-integration software said weak demand in Europe caused an unexpected drop in quarterly sales and profit, sending down other software stocks. Its second-quarter results yesterday trailed its own expectations, saying it didn’t adapt as rapidly as it should have to a downturn in demand. Customers were reducing or deferring orders may soon affect other providers including Teradata, Citrix Systems Inc, VMware Inc. and major corporations like Apple, Intel, Google and Microsoft. Many may reduce forecasts or miss earnings estimates, according to Daud Khan, an analyst at Berenberg Bank.

Microsoft disclosed plans to take a $6.2 billion charge tied to its unsuccessful 2007 acquisition of aQuantive and the warned of slower-than-expected growth in the quarter ahead.

Boeing Co. said growth in industry deliveries will slow to less than a fifth of the rate predicted in 2011over the next 20 years as demand for jumbo jets and freighters wanes. Today they announced new orders at the air show.

We expect Apple stock prices to plummet after year-over-year profit plummets from the last quarter Steve Jobs announced at the end of July. The current management is putting up smoke screens with feeble dividend and buy-back plans. In March 2012, the Apple Company announced its plans to initiate a quarterly dividend of $2.65 (today about 1.1% per year) per share of common stock beginning in the fourth quarter of 2012, subject to declaration by its Board of Directors. The Company further announced that the Board of Directors has authorized a program to repurchase up to $10 billion of the Company's common stock, commencing in 2013. Since Apple has 13,331,000,000 outstanding shares… $10 billion is worth a whopping $0.7 per share. But Apple is poised to easily lose $100 per share in face value when the disappointing quarterly earnings is reported vs. the record profits Steve Jobs reported last July before he passed away.

Alcoa begins the second-quarter U.S. earnings season today, with analyst estimates indicating the first year-over-year profit decline for S&P 500 companies since 2009.

The Rasmussen Reports the Presidential Tracking Poll for Sunday shows both Mitt Romney and President Obama tie with 45% of the vote.

http://www.rasmussenreports.com/public_content/politics/obama_administration/daily_presidential_tracking_poll


World market this week
Oil rebounded in New York after the biggest drop in two weeks as a labor strike threatens to halt production in the North Sea, Western Europe’s biggest exporter. Oil futures advanced 0.7 %.

“All eyes will be on the meeting of European finance ministers today to put a halt to the one-step-forward, two-step- backward discussions on the European sovereign debt crisis,” Jeroen van den Broek, a credit strategist at ING Bank NV in Amsterdam, wrote today in a report.

Japan’s machinery orders, an indication of capital spending, fell 14.8 percent in May from the previous month, the biggest drop since 2001. In a separate release, the Ministry of Finance said Japan’s current-account surplus was the smallest for the month of May since 1985.

China’s Premier Wen Jiabao said downward pressure on the economy is still “relatively large”.

The country’s financial regulator and economists have warned Norway’s government of the threat of a full-blown housing bubble

Vestas Wind Systems, the world’s largest windmill maker, pared market losses to 10% in Copenhagen trading after saying it has no “concrete” plans to sell new shares to stay in business. The stock earlier slumped 10 percent after newspaper Jyllands-Posten reported that Vestas may need to sell shares to raise capital for restructuring.
The yield on Spain’s 10-year bond jumped to 7.07 % again in New York. The euro was little changed at $1.2303, the weakest since July 2010. European finance ministers were gathering yet again to work out the newest crisis measures.

Data showed Japan’s factory orders dropped, while Chinese Prime Minister Wen Jiabao said the nation’s economy faces “relatively large” downward pressure.


Emerging markets falter.
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

Germany faltering and 7% below the recent high but 20% higher than last year’s low: 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 Markets are becoming undecided.

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

American Economy
Past week
Generally the USA economic indicators were poor the last two weeks.

ISM Index Jun 49.7 51.5 manufacturing index declined 4% from 53.5

Construction Spending May 0.9% up from 0.6%. This is not just a waste, it keeps the whole Obama RE market in the “dead zone.”

Factory Orders May 0.7% recovers what it lost in April and therefore exactly where it was in February. But it is being spun like an Obama recovery under way.

Challenger Job Cuts Jun -9.5% down from 66.7% a huge job setback.

ADP Employment Change Jun 179K vs. 136K last month. Anything less than 400K is anemic. Ronald Reagan had over 900K coming out of the Jimmy Carter recession.

Initial Claims 06/30 374K vs. 388K last month

Continuing Claims 06/23 3306K up from 3296K last month

Friday

The nation's employers created almost enough jobs to keep up with population growth of illegal immigrants, but not nearly enough to reduce the backlog of well over 13 million unemployed workers. There are still over 12 million skilled illegal immigrants from Haiti and Nigeria that Obama says we need to keep our nation a leader in medicine and computer technology.

Nonfarm Payrolls including government Jun 80K up from 69K Nonfarm Private Payrolls Jun 84K down from 105K Together it means government grew twice as fast as the private sector shrank. That is just the opposite of what needs to happen to get out of the depression Obama is creating.

Unemployment Rate Jun 8.2% being manipulated down 8.2%

Hourly Earnings Jun 0.3% up from 0.1%

Average Workweek Jun 34.5 up from 34.4
This Week

Jul 9 3:00 PM Consumer Credit May

Jul 11 7:00 AM MBA Mortgage Index 07/07

Jul 11 8:30 AM Trade Balance May

Jul 11 10:00 AM Wholesale Inventories May

Jul 11 10:30 AM Crude Inventories 07/07

Jul 11 2:00 PM FOMC Minutes 6/20

Jul 12 8:30 AM Initial Claims 07/07

Jul 12 8:30 AM Continuing Claims 06/30

Jul 12 8:30 AM Export Prices ex-ag. Jun

Jul 12 8:30 AM Import Prices ex-oil Jun

Jul 12 2:00 PM Treasury Budget Jun

Jul 13 8:30 AM PPI Jun

Jul 13 8:30 AM Core PPI Jun

Jul 13 9:55 AM Mich Sentiment Jul


Market outlook July 9, 2012
The US markets are likely to fall like a knife for at least a month with the coming worst quarter in a few years. Plus, the better Obama does in the polls the more the market will fall because intelligent people are not investing while Obama squanders America’s wealth. If Obama is re-elected we predict a full-blown depression. Right now the election is a dead heat.

Examine the last 5 years of the NYSE. Obama could easily be taking America into a profoundly deep bear market if he is re-elected.

http://finance.yahoo.com/echarts?s=%5ENYA+Interactive#symbol=^nya;range=5y;compare=;indicator=ema(200,100)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

The Dow Theory Industrials and Rails sell signal of August 2, 2011 still holds. It failed to meet even the last shoulder of the head and shoulder sell signal.

http://finance.yahoo.com/echarts?s=%5EDJT+Interactive#symbol=^djt;range=5y;compare=^dji;indicator=;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined;

Obama is so inept; a deep depression can only be prevented if he is ejected, not elected. But Chief Justice John Roberts has assured that every stupid and lazy American will rally to re-elect Obama now because he provides the welfare for people who refuse to work for $10 or $15 per hour. The sell signal is seen in 3-month market cyclic data.
http://finance.yahoo.com/echarts?s=%5ENYA+Interactive#symbol=^nya;range=2y;compare=;indicator=ema(200,100)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=off;source=undefined

The VIX says the market is again complacent and extremely dangerous.

http://finance.yahoo.com/q/bc?s=%5EVIX&t=2y&l=on&z=m&q=l&c=

The Baltic Dry Index is already anemic and couldn’t get much worse.

http://www.bloomberg.com/quote/BDIY:IND/chart



Stock market update:
Asian markets were down sharply last night. China down –2.4%, Hong Kong down –1.9%, Singapore down –1.7%, S.Korea down –1.2%, Japan down –1.4%.

European markets were down half way through their day in a range of 0% to –0.3%

American market futures are down at about -0.4% in after hour trading at 7:30AM EST.