To be more presidential Romney must be smarter and stop apologizing and start taking the offensive. Romney’s advisors are to blame and seem to be incompetent or working for Obama. Jimmy and Obama are tied now as the most miserable presidents in American history. Jimmy Carter invented the misery index, which is equal to the sum of the percent unemployed plus the percent inflation rate. Like Obama, Jimmy Carter tried to destroy the American hydrocarbon industry and exacerbated both unemployment and inflation in that process. Misery in America is expected to increase substantially if Obama gets a second term. Think of what Winston Churchill said. “The inherent vice of capitalism is the uneven division of blessings, while the inherent virtue of socialism is the equal division of misery.”

The "D" word refers to when Obama said Bush put us into a "Depression" well before the run on the bank Senator Dodd started by announcing that a California bank was going to fail. Together Obama and Dodd (on the Senate Banking Commission) did something that no others in the history of America did. They deliberately undermined confidence in America after they both had deliberately undermined the housing industry by requiring that real estate companies give and that Fannie and Freddie underwrite "Liar Loans" to indigents who could not get home mortgages unless they lied about their income and savings. That is right, if the bank denied a loan because the applicant supplied no proof of income, and the applicant was a minority member, the bank and realtors were and still are vulnerable to being sued for racial discrimination by the justice Department (under Obama-Holder).

The long run is not good for gold. Keep in mind that gold dropped from over $800/oz to under $300/oz once Jimmy Carter was voted out of office in 1980 and it did not rise significantly again until after 2000. We believe gold will have a choppy rise and is already overpriced for the short run because it gapped up too fast and lacks underlying support. Also, if Obama is re-elected the world may go off the dollar standard and US inflation will then have no effect on the price of gold and America could just go broke. Then Americans will all have the equal distribution of wealth that Obama is creating now.

The mayor of Chicago yesterday sought a court order to force teachers back into classrooms. The Sept. 16 decision by the union to continue Chicago’s first public- school strike in a quarter century means 350,000 students will be out of class for at least a sixth day.

The Fed’s will buy $40 billion of mortgage-backed securities per month, while leaving the previous QE2 and ‘operation twist’ bond buying programs in place. In effect the Fed will be buying the mortgage-backed securities from current holders, primarily banks, and the FED hopes they will move the money into areas that give the economy a boost. But the problem is that it does nothing to liquidate the bankrupt mortgage overhang. In fact the overhang is going to be hidden in the FED and not liquidated. The extra liquidity will obviously go into inflation which is the way US WWII debt was liquidated in the late 1940’s and the Lyndon Johnson’s war debt was liquidated in the 1970’s with Jimmy Carter’s stagflation. Stagflation is the likely consequence if Obama remains in office. Stagflation in the 1970‘s resulted in a stagnant economy and a volatile but stagnant stock market.

Obama Stagflation is predicted if Obama wins the election although many think community activist Obama is not nearly as bright as the nuclear engineer Jimmy Carter so it could be a lot worse. We may also have a Hostage crisis too if Obama does not wake up soon and smell the coffee.

A slowdown is now seen in U.S. manufacturing with Parker Hannifin profits turning down. Earnings are in net beginning to peak.

The Rasmussen Reports daily Presidential Tracking Poll for Sunday shows; Mitt Romney earns 47% of the vote while President Obama attracting support from 45% of voters nationwide. The Obama announced Great Depression would get a lot deeper if it turns out that way. Three percent (3%) prefer some other candidate, and three percent (3%) are undecided.

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

World market this week

Carrefour SA (CA) and Tesco Plc (TSCO) are faced with falling profits and consumer spending. India estimates retailer losses will exceed at least $500 million over three to five years in the world’s second-most populous nation. Such investment could pose a challenge for the European retailers, which are struggling amid the region’s debt crisis. Wal-Mart and Lowes are already withdrawing from China. Blackouts continue across cash strapped India.

Squabbling continues among European governments over the next steps needed to overcome the sovereign debt crisis as Spanish 10-year bond yields to their lowest in five months. The Sept. 14 European Union finance ministers meeting in Nicosia deadlocked over the timetable for a more unified EU banking sector as the ministers bickered over the terms of bailout requests and the role of the European Central Bank.

Europe’s protracted debt crisis, a U.S. jobless rate stuck above 8 percent and a slowdown in China are damping demand for Asian goods and commodities, prompting Hong Kong’s Trade Development Council to cut the Singapore’s export forecast today. The weakening global outlook is grim as the Obama cliff approaches.

Japan’s stock market today is lower than it was in 1984 when they say they started what we called quantitative easing.

http://finance.yahoo.com/echarts?s=%5EN225+Interactive#symbol=^n225;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

Here is one that Obama will not touch and could stop in a second if it were not the truth. He does not believe in the American dream because it never was socialism.

http://www.youtube.com/watch?feature=fvwp&NR=1&v=l-HqHSkYG-Y

Emerging markets. The American markets are essential to the recovery of the world.

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

Emerging market composite indicates continued breaking down through the recent lows.

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


German stocks are faltering below the 2011 high. It gave a sell signal in 2011 and has to rise a few more percent to give a buy signal again. 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 Market is also testing moving averages. It gave a sell signal last year. It is at a new high for 2012 but 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
The market continues to test old resistance levels.

Precious metals ETF’s will likely retrace and close some of the large price gaps that occurred it the recent rapid rise.

Yesterday

Empire Manufacturing index Sep -10.4 collapsing from -5.9

Today

Sep 18 8:30 AM Current Account Balance Q2

Sep 18 9:00 AM Net Long-Term TIC Flows Jul

Sep 18 10:00 AM NAHB Housing Market Index Sep

This Week

Sep 19 7:00 AM MBA Mortgage Index 09/15

Sep 19 8:30 AM Housing Starts Aug

Sep 19 8:30 AM Building Permits Aug

Sep 19 10:00 AM Existing Home Sales Aug

Sep 19 10:30 AM Crude Inventories 09/15

Sep 20 8:30 AM Initial Claims 09/15

Sep 20 8:30 AM Continuing Claims 09/8

Sep 20 10:00 AM Philadelphia Fed Sep

Sep 20 10:00 AM Leading Indicators Aug

Market outlook Sept 18, 2012
Apple got Wal-Mart back orders and therefore set record sales the first day for the I-phone.

The DJT is beginning to converge with the DOW. This is more positive than before but not yet a buy signal. This could be the high for the year or the beginning of a breakout or a blowout.

http://finance.yahoo.com/echarts?s=%5EDJT+Interactive#symbol=^djt;range=3m;compare=^dji;indicator=;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined;

There still has been no stock market buy signal but if this run-up continues again it could happen within a few weeks. The NYSE did have a 3mo-cycle breakout but not a major 1yr-cycle breakout yet.

People forget that the DJI is not by itself the famous stock market indicator. The DJR must confirm the DJI for there to be a buy signal or sell signal. The DJI and DJR confirmed a sell signal together in August 2011and 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. Therefore the DJI is biased bullish and needs the DJR for balance. The DJ Rails continues to say sell even as people seek the false security of the DJ Industrials. The Divergence is now ending but there still is no DOW Buy Signal.

http://finance.yahoo.com/echarts?s=%5EDJT+Interactive#symbol=^djt;range=3m;compare=^dji;indicator=;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined;

12,000 Federal workers are reported getting government pensions exceeding $100,000/yr for life.

The NYSE is much more representative of the US economy than are the DOW indices. 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.

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;

Resumption of the bull stock market is possible soon but it looks like the effects of the Ponzi QE3 scheme. In Japan it led to their 22-year recession after the market almost tripled in five years.

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 back down in La-La Land. The low VIX normally precedes a sell-off. Once that starts the VIX needs to go up above 30 until bear markets normally end. The driving force this year is the election and whether the morons win or lose.

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

The Baltic Dry Index says world trade is now at a depression low. When Obama began his campaign in 2006 he said George Bush already had the economy in a depression. Never before had anyone said such a thing that could unsettle an economy. Look at 5 years and you see bulk trade peaked when Obama was nominated in 2008 and got worse with Obama’s socialist redistribution policies that give no incentive for most of his voting constituency to work. Socialism cannot be stopped when the people who pay no taxes and have no skin in free enterprise… when their voting block is more than 50% of the voters. Consider also that fewer than 60% of working people usually vote. In socialist dictatorships 98% vote and most vote for their Mad Hatter.

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

Stock market update:
Asian markets followed were down sharply last night. China down –0.9%, Hong Kong down –0.1%, India down –0.3%, Taiwan down –0.4%, Japan down –0.4%

European markets are down sharply half way through their day in a range of –0.2% to –1.2%.

American market futures are down about -0.1% in after-hour trading at 8 AM EST. This indicator does not statistically correlate with anything.