We need to vote the “Obama Evil Empire” out of office. Otherwise when the Obama FED Ponzi scheme is recognized US interest rates on debt will soar and pension funds and conservative investor cash holdings will evaporate. There could also be a run to throw out the dollar that could wipe out cash that corporations are holding on their balance sheets. If a socialist is in office at the time he will enjoy the crisis and use it to nationalize major sectors starting with the US Banks. We expect bank stocks would quickly become worthless. That is what socialists in Britain have done in the past. Years later conservative Prime Minister Margaret Thacher privatized British banks again but the people who lost everything got nothing back. America has never faced a socialist government like Obama’s before and Americans do not realize that socialists make their gains by creating and claiming they are managing the crisis when in reality they maintain the crisis and claim they had to because free enterprise has failed.

But in America’s 230-year history free enterprise has never gone bankrupt. Free enterprise erases failed ideas like socialism in a regenerative creative process. Just as Obama blames Bush for everything… the socialists always blame capitalism for the destruction the socialists spread. The USSR survived and oppressed their citizens for about 70 years. The USSR’s most popular and successful leaders were Yeltsin and Gorbachev who put an end to the rule of the socialists and broke up their “evil empire.”


Forty years ago, the Club of Rome wrote a best-selling report warning humanity that western prosperity was on a collision course with the world's finite resources and that the only way to avoid a crash was to stop economic growth. The predictions proved spectacularly wrong. They predicted that gold might run out as early as 1979 and would certainly do so by 1999. We were to run out of fossil fuels by 2020. That was based on sophisticated MIT models and the report was 100% wrong preserving the 100% record of the environmentalists on every disaster they have predicted.

Environmental Alarmism, Then and Now, The Club of Rome’s Problem -- and Ours
http://www.cfr.org/energyenvironment/environmental-alarmism-then-now/p28606

The WSJ Morning MarketBeat today said, “Nobody thought earnings season would be quite this bad, and if companies are struggling, it will likely be another blow for an already weak jobs market.”

The U.S. Fed and European Central Bank face a critical test this week amid heightened expectations that they are moving toward new coordinated Ponzi schemes to tackle fragility in the global economy with their usual unintended Ponzi consequence of a complete collapse.

The only difference between Obama’s Ponzi Scheme and the one Greece was using is the Greeks were borrowing from the EU and America has borrowed primarily from the novice China. China does not understand Obama is playing on the Chinese. China is getting credits ten years of credits that in ten years will be worth as much as all the Greek worthless credits. Unlike Bernie’s Ponzi scheme, Obama’s spend with no taxation is plain for everyone to see but China and the EU are fooled because Obama rejects American free enterprise, and wants Nigerian/Indonesian religions, economics and culture. Obama thinks America is stealing valuable minerals from developing countries and giving them worthless material things. Obama goes not believe in competition. He wants government o mandate what health care, recreation, and food that people can have. When China regulates everything he thinks competition is not needed because the government knows best.

Investors continued to pull money out of equity mutual funds in the first half of this year at a high pace relative to the two previous years. At the same time the equities market has become more illiquid and cannot support rapid in or out flows without massive volatility. The Investment Company Institute said $55 billion exited in the first six months this year, compared to $24.6 billion in the first six months of 2010, and $13.6 billion the first six months last year. We are warning that we have been in a bear market since August 2011.

The Rasmussen Reports daily Presidential Tracking Poll shows Mitt Romney stuck in a 47% to 44%dead heat with Obama. http://www.rasmussenreports.com/public_content/politics/obama_administration/daily_presidential_tracking_poll


World market this week
Half of India is under an electricity blackout.

Signs of economic weakness are emerging out of Asian tigers South Korea and Taiwan as the slowdown in key trading partner China takes a toll on the export-driven nations.

Toshiba Corp. reported Tuesday that it swung into a net loss in the fiscal first quarter as restructuring costs and the high yen outweighed growth in its energy-related infrastructure business.

UBS said it would start legal proceedings against exchange operator Nasdaq OMX Group after the Swiss bank's second quarter was hit by a big loss from the Facebook stock-market debut

Economic confidence in the 17-nation euro area fell to 87.9 from 89.9 in June… more than economists forecast to the lowest in almost three years in July, suggesting the economy’s slump extended into the third quarter as governments struggled to tame the debt crisis. The Euro fell to $1.22.

China’s volatility indexes are increasing according to Bloomberg which tracks US and other market volatility. That is a sign that the bull trap is beginning to close on all world stock markets and the bears know Obama-Bernanke are running a Ponzi scheme.

The glut in the shipping fleet has pushed new vessel prices to eight-year lows and caused a 49 percent plunge in first-half orders at China’s more than 1,500 shipbuilders. It’s also put smaller yards into bankruptcy and hit earnings at larger players.

Emerging markets faltered at recent high which is well blow the March level which is well below the high of 2012. All world markets will suffer now unless Obama is given the heave-ho. 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 below the recent high which is well blow the March level which is well below the high of 2012: Choose 2 or 5 years. The DAX can’t even keep up with the DJI!
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 Market is testing moving averages. It gave a sell signal last year. It is at a new high for 2012 but well below the 2011 high.

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
FHFA Housing Price Index May 0.8% same as last months 0.8%

The Commerce Department said Wednesday that sales of new homes fell 8.4% last month from May’s 369k rate to a 350K rate in Jun

MBA Mortgage Index 07/21 was 0.9% down sharply from 16.9% last month. This means the Democrat liar loan crisis has not eased.

Crude Inventories 07/21 rose 2.717M even as prices plummet due to a world economic slowdown.

Yesterday
Initial Claims 07/21 355K down from 386K good

Continuing Claims 07/14 3304K up from 3300K bad

Durable Orders Jun 1.6% unchanged from 1.6%

Durable Orders - ex Transportation Jun -1.1% way down from 0.8% very bad

Pending Home Sales Jun -1.4% way down from 5.9% very bad

GDP-Adv. Q2 1.5% adjusted down from Obama’s original 2%+ estimate

Chain Deflator-Adv. Q2 1.6% which is higher than the growth rate that says the recession continues.

Michigan Sentiment - Final Jul 72.3 up slightly from 72.0 last month.

Today
Jul 31 8:30 AM Personal Income Jun

Jul 31 8:30 AM Personal Spending Jun

Jul 31 8:30 AM PCE Prices - Core Jun

Jul 31 8:30 AM Employment Cost Index Q2

Jul 31 9:00 AM Case-Shiller 20-city Index May

Jul 31 9:45 AM Chicago PMI Jul

Jul 31 10:00 AM Consumer Confidence Jul

This Week

Aug 1 7:00 AM MBA Mortgage Index 07/28

Aug 1 8:15 AM ADP Employment Change Jul

Aug 1 10:00 AM ISM Index Jul

Aug 1 10:00 AM Construction Spending Jun

Aug 1 10:30 AM Crude Inventories 07/28

Aug 1 2:00 PM Auto Sales Jul

Aug 1 2:00 PM Truck Sales Jul

Aug 1 2:15 PM FOMC Rate Decision Jul

Aug 2 7:30 AM Challenger Job Cuts Jul

Aug 2 8:30 AM Initial Claims 07/28

Aug 2 8:30 AM Continuing Claims 07/21

Aug 2 10:00 AM Factory Orders Jun

Aug 3 8:30 AM Nonfarm Payrolls Jul

Aug 3 8:30 AM Nonfarm Private Payrolls July

Aug 3 8:30 AM Unemployment Rate Jul

Aug 3 8:30 AM Hourly Earnings Jul

Aug 3 8:30 AM Average Workweek Jul

Aug 3 10:00 AM ISM Services Jul



Market outlook July 31, 2012
People forget that the DJI is not the stock market signal. The DJR must confirm the DJI for there to be a buy signal. The DJI and DJR confirmed a sell signal together last August and the DJR remains confirming that sell signal today. The DJI is the last “safe” place bulls go to reduce risk before the entire stock market collapses. The DJI bull trap opened all the way on Friday. Yesterday’s wasn’t a breakout of even the March high much less the 2011 high. The DJ Rails continues to say sell even as people seek the safety of the DJ Industrials.
http://finance.yahoo.com/echarts?s=%5EDJT+Interactive#symbol=^djt;range=6m;compare=^dji;indicator=;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined;

Cash and precious metals are a better choice than being fully invested in stocks right now until it is abundantly evident Obama and Holder will be out of office. Obama, Geithner, and Bernanke are running a Federal Ponzi Scheme now to make Treasuries appear attractive so they can finance a $1.2Trillion per year debt which will bankrupt the USA if they are not thrown out in November. Corporations are cash rich now because they are hoarding cash because the collapse of the US treasuries will leave America without any cash. There is only credit, gold, and silver available in America because few people hold cash today. And in fact most corporations do not actually have any cash, they just have a cash balance in a bank account of a bank which will be bankrupt when this Obama, Geithner, and Bernanke Ponzi scheme collapses.

The NYSE is much more representative of the US economy than is the DOW anything. Examine the last 5 years of the NYSE. It shows that Obama may be taking America into a profoundly deeper depression breaking 2009 lows 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. The Rails failed again to meet even the last shoulder of the head and shoulder sell signal.  So the DOW sell signal remains in place.

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;

The market sell signal is also seen in 3-month market cyclic data. Notice that yesterday wasn’t even a breakout.
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 is now showing the bear market has started but the VIX indicates the market still has a long way to go until the VIX rises above 30 where bear markets normally end.
http://finance.yahoo.com/q/bc?s=%5EVIX&t=5y&l=on&z=l&q=l&c=

The Baltic Dry Index is already anemic and now is falling again. World trade has now almost completely collapsed with just having Obama around, without tariffs that were the blame for the collapse during FDR’s socialist experimentation that resulted in the last Great Depression. Clearly it is the corruption of gangster socialism and its crony capitalism, not rigorous free enterprise, that always ends in collapse of production and then economic depression.
http://www.bloomberg.com/quote/BDIY:IND/chart

Stock market update:
Asian markets were up last night. China down -0.3%, Hong Kong up 1.1%, Singapore up 0.1%, Japan up 0.7%.

European markets were mixed half way through their day in a range of +0.5% to -0.4%

American market futures are up about 0.3% in after-hour trading at 7 AM EST. This indicator does not statistically correlate with anything.