July 19 Corrupt politicians and corrupt unions pick the pockets of the citizens of Detroit taxpayers and the hard working retirees who buy the municipal bonds that support the city. Arbitration is the source of the corruption. Corruption is inevitable when the politicians pick the arbitrators and the unions pick the politicians. Detroit sought protection for the Motor City under Chapter 9 of the U.S. Bankruptcy Code to deal with more than $18 billion in debt and long-term obligations. Will a complete bailout with the unions coming up whole be the Obama solution and the Detroit private debt holders losing everything just as they did with Obama’s GM bailout. If that is the case municipal bond holders will have to re-evaluate risks and financial markets and the fed will see interest rates rising two or three times the current projections.

July 18 The picture the Federal Reserve painted in its beige book snapshot of the economy indicates the economy continues to be an engine running on about half of its cylinders. That's better than it was in 2010, but it expects growth slowed sharply in the second quarter, and federal budget cuts slash the growth that housing and cars. The housing market and car sales were the only sectors improving but now higher interest rates are taking its toll.
http://www.usatoday.com/story/money/business/2013/07/17/july-beige-book-analysis/2525043/
The US corporations that benefited from China’s growth are now being hurt. Two years ago, Nike was so bullish on China it predicted sales there would double in four years. But China sales continues to fall the past five quarters.
Intel profit tumbled 29% on PC sales slump. IBM did not make estimates and revenue growth dropped to only 3%’
The residential real-estate market suffered a setback in June as housing starts fell to the lowest level in almost a year, curbing U.S. economic growth last quarter.
　
July 17 James S. Chanos today predicted the statistical reversion to the mean in stock values. He said that the market and individual stocks such as his latest CAT warning and his other short recommendations foe Hewlett-Packard (NYSE: HPQ) and Dell (NASDAQ: DELL), while making negative comments about Chesapeake Energy (NYSE: CHK), Netflix (NASDAQ: NFLX) and Herbalife (NYSE: HLF). James S. Chanos said the US stock market has nowhere to go but down now because the stocks are at their historic highs for revenues and financial metrics. Also he pointed out how companies such as CAT had acquired other companies and written their values down so negatively that even if the did not work out the assets would make CAT look good. James S. Chanos said American companies that benefited from China’s building boom would be hurt by China’s decline. CAT dropped continuously while he talked and was down 1.84% by the time that he had finished his presentation.
Tesla shares, which soared to a new all-time high earlier this week had the biggest one-day drop Tuesday that the stock has seen since January 2012. The hedge funds have finished their game of hyping their wares about the "booming" Obama economy and pumping up the valuation of stocks after they have bought in. That plunge in Tesla was the big investors pulling the plug one little known non-index stock at a time so that the DJI and other carefully watched indices do not signal the bear market until most of the little known stocks take a big hit.

Higher interest rates increase the cost of doing business and hurt the stock market. So business income drops as rates rise plus you get the double whammy of bonds and especially dividend paying stocks competing with regular stocks. Note that Gold prices only peaked in 1981 when interest rates peaked at 21%. Money Market CDs gave you 16% risk free interest at that time. That is what is coming and gold prices have a long way to rise. See:   http://research.stlouisfed.org/fred2/series/TB3MS/
　

The broader NYSE is in agreement with all the European stock markets and they tell us the welfare state with it free wheeling spending like QE3 is killing the economies of the western world. The FTSE rose just as the NYSE and is also overpriced. Select just the last year and you see the second shoulder of the head and shoulder sell signal is forming just like it is for the NYSE. The only thing different is we got the sell signal in time to get out on the rise of the second shoulder. When these markets drop it will be sudden and happening all around the world. For many small investors they will be caught off guard. The FTSE 100 Index is close to its upper resistance level reached previously in 2000 and 2007 just like the NYSE and other broad market indexes. The DJI is an average of 30 stocks and is far too easy to manipulate.
http://finance.yahoo.com/echarts?s=%5EFTSE+Interactive#symbol=%5Eftse;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

The German market is close to its upper resistance level reached previously in 2000 and 2007.
http://in.finance.yahoo.com/echarts?s=%5EGDAXI#symbol=^gdaxi;range=1y;compare=;indicator=sma+volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

The French market indicates stagnation since year 2000. It still is down 50% from 2008.
http://in.finance.yahoo.com/echarts?s=%5EFCHI#symbol=^fchi;range=1y;compare=;indicator=sma+volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

The Swiss market indicates stagnation since 2007. http://finance.yahoo.com/echarts?s=%5ESSMI+Interactive#symbol=^ssmi;range=my;compare=;indicator=sma+volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

The NYSE is similar to the British and Swiss and indicates stagnation since 2007 given in excess of 15% inflation since then and no similar market advance. The NYSE index is too big to manipulate legally. It has 300 stocks just starting with the letter A.
http://finance.yahoo.com/echarts?s=%5ENYA+Interactive#symbol=^nya;range=my;compare=;indicator=sma+volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

Only manipulated indexes (such as the DJI which has 30 carefully selected stocks) are not warning that this run-up in prices is over. And sometimes they won’t even let you see "ALL" the data. It is manipulated at least two ways. First the stocks in the index tend to be added when they are in the rapid growth stage and removed when they reach the mature stage. The second way is they are considered safe stocks and get high recommendations that are self fulfilling because they are then well known, trusted and heavily bought.
http://finance.yahoo.com/q/bc?s=%5EDJI&t=1y&l=off&z=l&q=l&c=

World Economies
http://www.bloomberg.com/news/
http://www.foxbusiness.com/index.html

American Economy
Jul 15
Retail Sales Jun 0.4% plummeted from 0.6% ---
Retail Sales ex-auto Jun 0.0% declined again from 0.3% --
Empire Manufacturing Jul 9.46 still below 10—was worse last time 7.8 –

Jul 16
Business Inventories May 0.1% still growing too much, was worse 0.3% ---
CPI Jun 0.5% at a 6% annual rate up from 0.1% or a 1.2% annual rate –
QE@ is supposed to phase out when inflation hits 2.5%
Core CPI Jun 0.2% same 0.2% still a 2.4% annual rate --
Net Long-Term TIC Flows May -$27.2B investment money is leaving the USA -$37.3B ---
Industrial Production Jun 0.3% up from 0.0% +
Capacity Utilization Jun 77.8% flat lined 77.6%
NAHB Housing Market Index Jul 57 was 52 a fluctuation

Jul 17
MBA Mortgage Index 07/13 -2.6% again after -4.0% ----
Housing Starts Jun 836K down from 928K
Building Permits Jun 911K low but slight uptick from 985K -
Crude Inventories 07/13 -6.902M fell again -9.874M ----

Jul 18
Initial Claims 07/13 334K down from 358K ++
Continuing Claims 07/06 3114K up from 2977K ---
Philadelphia Fed Jul 19.8 N.G. statistical outlier from 12.5
Leading Indicators Jun 0.0% down from 0.1% --
Natural Gas Inventories 07/13 58 bcf down from 82 bcf

The Markets July 19, 2013
Today the NYSE collided with its May high but is still 4% below the 2007 high. We estimate 2% of investor cash has flowed out of the market since May.

We got our market cash flow sell signal July 8. About half the time it happens near the start of the stock market’s last-gasp rally so it is possible to get out before the plunge.  We offer just information and no advice.
The recent Bulls- Bears indicator. More bulls than bears means more exuberance or topping. It is still a bearish sign that as the market breaks down small investors have remained bullish!
http://www.martincapital.com/index.php?page=graph&view=investors_intel

World trade has been dead for four years (flat lined). Look at the last 5 years! It still looks close to zero growth.
http://www.bloomberg.com/quote/BDIY:IND/chart

Earnings have stagnated and do not support current prices.
http://www.martincapital.com/index.php?page=graph&view=div_earns_payout

The VIX indicates the worst is about to come. The VIX would normally top out above 30 or even 70 before the bear market ends.
http://finance.yahoo.com/q/bc?s=%5EVIX&t=5y&l=on&z=l&q=l&c=

World market updates:
http://finance.yahoo.com/intlindices?e=europe
http://finance.yahoo.com/intlindices?e=asia