Consumer confidence remains low. Home appreciation used to be a major source of borrowing through equity loans. When inflation matured it ultimately helped the debtors but today we have deflation first that first increases the percentage of debt putting consumers underwater.
When inflation starts again it will hurt debtors much more than they hurt today because before it raises home values it will first increase interest rates. Variable rates will double when inflation doubles. And it does not take much inflation to double interest rates from 2% to 4% or to quadruple them from 2% to 8%. The economy will need a different engine to recover for a while. In fact as the recovery increases many consumers will see relentless increases in the variable rate mortgage payments. If inflation jumps from 2% to 4% the variable rate debtor will see the relative value of his debt drop 4% due to the 4% inflation but he will still be under water and the variable rate payment paid on the mortgage will close to double. That is when the variable rate debtor will really feel the pain.
Market forces August 18
The media resumed its positive stance today. Yesterday most advisors were negative but today we once again have the Pollyanna spin headlines such as, “Home Depot's Second-Quarter Profit Falls Less Than Estimated; Sales Drop Home Depot Inc., the largest home- improvement retailer, reported second-quarter profit that fell less than analysts estimated.”
Jim Cramer said it was the duty of the media to use low estimates before the earnings announcement so the estimates are exceeded and then it is the duty of the corporations to give glowing projections for the rest of the year. Any company that always makes honest projections goes on Jim Cramer’s wall of shame. Every time Wall Street or Barron’s tells it like it is, the Jim Cramer MSNBC/Pravda spin doctors take the honest press to task. The spin now is not dangerous but Jim Cramer consistently gets people buying when the stock prices are about to collapse.
Home Depot had miserable results to report just as Lowes did before them. But HD gave an encouraging projection today for the rest of the year so Jim Cramer’s dishonesty paid off again as stock futures rose today.
The stock market is beginning to behave like the socialists declaration that Obama saved us from a great depression was a big farce intended to railroad through socialist legislation. The more people protest now against Obama and the more his presidency fails, the higher the stock market seems to go. So if socialized medicine fails we may not have the expected summer decline. And if cap-n-trade wealth redistribution fails next, this could be a very good year for investors.
Market Outlook
Last night Asian markets were mixed: Communist China up 1.4%, socialist Japan up 0.3%, oligarchy Hong Kong up 0.8%, Jakarta is down -2.1% and Taiwan is also down -2.1%.
Today most of the socialist European markets are up in a range of 0.5% to 0.8%
US futures are up 0.6% now at 7:30 EST before the market opening this morning.
Any panic spike down now is now a potential buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. So far this year Jim Cramer is rotated his advice three times from defensive stocks to cyclical stocks. In other times he would have held tight for a year or more. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market. Buy after they deflate a sector when there are bargains. The hedge funds move quickly in and out so after they move in it is usually too late.
Tuesday, August 18, 2009
Monday, August 17, 2009
Many banks are now close to the point of no return
Consumer confidence declined due to job concerns. Banks are close to the point of no return as toxic loans exceed 5% of many bank's holdings.
Stocks in U.S. fell as and a consumer Confidence Drop Adds to evidence the recent Rally is unsustainable.
David Tice, Federated Investors Inc.’s chief portfolio strategist said U.S. stocks are “dramatically overpriced” because the fallout from the financial crisis continues to hurt consumer spending. The Fund that Tice founded returned 27 percent last year. He predicts that the S&P 500 will eventually slump to 400. Tice told Bloomberg TV, “After a big decline like we had, it’s not unexpected to have a big rally.”
Tice said he’s the most confident ever that the stocks will fall beneath their March low and a drop to 400, a 61 percent plunge from yesterday’s close, is likely within a year. Tice said that predictions for an economic recovery led by a rebound in consumer spending are unrealistic because falling real estate prices have destroyed wealth, “The consumer has had a diminution of net worth like we’ve never seen,” he said. “That’s going to impair spending.”
Missed payments by consumers, builders and small businesses so far have pushed 72 lenders into failure this year, the most since 1992. Problem banks stood at 305 in the first quarter. Even excluding the stress-test list, at the end of the first quarter banks with nonperformers above 5 percent had combined deposits of $193 billion, according to Bloomberg data. That is more than 14 times the size of the FDIC’s deposits insurance fund that is supposed to bail out depositors. The FDIC will probably impose an emergency fee on the more than 8,200 banks it insures in the fourth quarter to replenish the insurance fund, the second special assessment this year, Chairman Sheila Bair said last week.
Bloomberg said, More than 150 publicly traded U.S. lenders own nonperforming loans that equal 5 percent or more of their holdings, a level that former regulators say can wipe out a bank’s equity and threaten its survival. The number of banks exceeding the threshold more than doubled in the year as real estate and credit-card defaults surged. Almost 300 reported 3 percent or more of their loans were nonperforming, a term for commercial and consumer debt that has stopped collecting interest or will no longer be paid in full.
The biggest banks with nonperforming loans of at least 5 percent include Wisconsin’s Marshall & Ilsley Corp. and Georgia’s Synovus Financial Corp., according to Bloomberg data. Among those exceeding 10 percent, the biggest in the 50 U.S. states was Michigan’s Flagstar Bancorp. All said in second- quarter filings they’re considered financially sound.
“These numbers are off the charts,” said Blake Howells, an analyst at Becker Capital Management in Portland, Oregon. Banks are losing the “ability to try and earn their way through the cycle.”
Market forces August 17
President Obama has stated that we must be more like the European socialists and he now completely controls the American political machinery. It is going to get a lot worse if Obama succeeds with his legislation. Word at this hour is that socialist democrats are re-thinking these health-care forums. Some want to junk discussing health care and ram it through.
Democrat Dick Durbin all but said they're a waste of time and he'd rather not get sucker-punched for defending the bill. Socialist-democrats would rather arrogantly scrap the democratic forums than the un-democratic health-care proposals they're pushing.
Market Outlook
A panic sell off of 25% in one day similar to 1987 is now a growing risk.
Chinese stocks today plunged to their lowest level in two months, on renewed concerns over the economic outlook, government policy, and the lack of transparency into their communist system that pirates technology, lacks truthfulness, and produces much of the worlds junk and unsafe products.
After running share prices up by more than 90 percent this year by early August, the benchmark Shanghai Composite Index shed 176.24 points, or 5.8 percent, to close at 2,870, the lowest since June 18 - while the smaller Shenzhen Composite Index sank 6.6 percent to 955. Property shares were among the biggest losers, with China Vanke falling by 9.95 percent and Poly Real Estate slipping 7.4 percent.
Analysts say investors are concerned about a liquidity crisis. But the decline also reflected the broader economic outlook that American consumer confidence is weakening which could mean less demand for Chinese exports. Today's losses even extended the declines that took the Shanghai benchmark 6.6 percent lower last week.
The long rally in share prices had begun to raise worries that loose credit was fueling an unsustainable bubble in a market long prone to gyrations.
We definitely see bubble psychology everywhere again. We would not buy at these elevated prices but instead seek alternative investments such as corporate bonds except when individual stocks correct (more than 10%) and offer real buying opportunities. The market is in an extremely overbought and exhausted position again. If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were down: Communist China down -7.8%, socialist Japan down -3.1%, oligarchy Hong Kong down -3.6%, and socialist India down -4.1%.
Today most of the socialist European markets are down in a range of -1.7% to -2.4%
US futures are down 2% now at 7:30 EST before the market opening this morning. The financial sector is particularly overbought with commercial debt about to crash through the roofs.
We anticipate a panic spike down any time now as a potential buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market. Buy after they deflate a sector when there are bargains. The hedge funds move quickly in and out so after they move in it is usually too late.
Stocks in U.S. fell as and a consumer Confidence Drop Adds to evidence the recent Rally is unsustainable.
David Tice, Federated Investors Inc.’s chief portfolio strategist said U.S. stocks are “dramatically overpriced” because the fallout from the financial crisis continues to hurt consumer spending. The Fund that Tice founded returned 27 percent last year. He predicts that the S&P 500 will eventually slump to 400. Tice told Bloomberg TV, “After a big decline like we had, it’s not unexpected to have a big rally.”
Tice said he’s the most confident ever that the stocks will fall beneath their March low and a drop to 400, a 61 percent plunge from yesterday’s close, is likely within a year. Tice said that predictions for an economic recovery led by a rebound in consumer spending are unrealistic because falling real estate prices have destroyed wealth, “The consumer has had a diminution of net worth like we’ve never seen,” he said. “That’s going to impair spending.”
Missed payments by consumers, builders and small businesses so far have pushed 72 lenders into failure this year, the most since 1992. Problem banks stood at 305 in the first quarter. Even excluding the stress-test list, at the end of the first quarter banks with nonperformers above 5 percent had combined deposits of $193 billion, according to Bloomberg data. That is more than 14 times the size of the FDIC’s deposits insurance fund that is supposed to bail out depositors. The FDIC will probably impose an emergency fee on the more than 8,200 banks it insures in the fourth quarter to replenish the insurance fund, the second special assessment this year, Chairman Sheila Bair said last week.
Bloomberg said, More than 150 publicly traded U.S. lenders own nonperforming loans that equal 5 percent or more of their holdings, a level that former regulators say can wipe out a bank’s equity and threaten its survival. The number of banks exceeding the threshold more than doubled in the year as real estate and credit-card defaults surged. Almost 300 reported 3 percent or more of their loans were nonperforming, a term for commercial and consumer debt that has stopped collecting interest or will no longer be paid in full.
The biggest banks with nonperforming loans of at least 5 percent include Wisconsin’s Marshall & Ilsley Corp. and Georgia’s Synovus Financial Corp., according to Bloomberg data. Among those exceeding 10 percent, the biggest in the 50 U.S. states was Michigan’s Flagstar Bancorp. All said in second- quarter filings they’re considered financially sound.
“These numbers are off the charts,” said Blake Howells, an analyst at Becker Capital Management in Portland, Oregon. Banks are losing the “ability to try and earn their way through the cycle.”
Market forces August 17
President Obama has stated that we must be more like the European socialists and he now completely controls the American political machinery. It is going to get a lot worse if Obama succeeds with his legislation. Word at this hour is that socialist democrats are re-thinking these health-care forums. Some want to junk discussing health care and ram it through.
Democrat Dick Durbin all but said they're a waste of time and he'd rather not get sucker-punched for defending the bill. Socialist-democrats would rather arrogantly scrap the democratic forums than the un-democratic health-care proposals they're pushing.
Market Outlook
A panic sell off of 25% in one day similar to 1987 is now a growing risk.
Chinese stocks today plunged to their lowest level in two months, on renewed concerns over the economic outlook, government policy, and the lack of transparency into their communist system that pirates technology, lacks truthfulness, and produces much of the worlds junk and unsafe products.
After running share prices up by more than 90 percent this year by early August, the benchmark Shanghai Composite Index shed 176.24 points, or 5.8 percent, to close at 2,870, the lowest since June 18 - while the smaller Shenzhen Composite Index sank 6.6 percent to 955. Property shares were among the biggest losers, with China Vanke falling by 9.95 percent and Poly Real Estate slipping 7.4 percent.
Analysts say investors are concerned about a liquidity crisis. But the decline also reflected the broader economic outlook that American consumer confidence is weakening which could mean less demand for Chinese exports. Today's losses even extended the declines that took the Shanghai benchmark 6.6 percent lower last week.
The long rally in share prices had begun to raise worries that loose credit was fueling an unsustainable bubble in a market long prone to gyrations.
We definitely see bubble psychology everywhere again. We would not buy at these elevated prices but instead seek alternative investments such as corporate bonds except when individual stocks correct (more than 10%) and offer real buying opportunities. The market is in an extremely overbought and exhausted position again. If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were down: Communist China down -7.8%, socialist Japan down -3.1%, oligarchy Hong Kong down -3.6%, and socialist India down -4.1%.
Today most of the socialist European markets are down in a range of -1.7% to -2.4%
US futures are down 2% now at 7:30 EST before the market opening this morning. The financial sector is particularly overbought with commercial debt about to crash through the roofs.
We anticipate a panic spike down any time now as a potential buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market. Buy after they deflate a sector when there are bargains. The hedge funds move quickly in and out so after they move in it is usually too late.
Friday, August 14, 2009
American technological creativity is now being crushed by Obama
Market churning is what they do at market tops
At market bottoms they scare you into selling. At market tops they tell you that it is a good time to buy even at the peaks after a run-up of 48% in three months. They churn investors at the top.
No one needs to be told how the con men can twist facts and words to sell someone a lemon or a clunker. We know the same people who said buy-buy-buy all through 2007 and 2008 are out there right now saying buy-buy-buy. That is the only thing they know because they generally invest very poorly themselves and depend on the rest of us for their commissions or their TV entertainment income. They are terrible investors themselves or they would not be working for our commissions or entertaining us. And so they have a clear conflict of interest. They must sell you a bag of goods in order to make a living. And so they also spin everything positive when things are going up and then they scare the pants off of us when things are going down. That is known as churning and that is what it has been called since the panics of the 1800's. Right now they are selling us stocks that in their business they call pigs with lipstick.
Churning refers to moving stocks when there is nothing financially going on that justifies investment activity. Churning is how many get commissions while actually providing a disservice to investors. That is what they have been doing for months now.
Well, folks we have other alternatives. There are bond funds that are doing much better than the bank and there are RE partnerships and direct real estate investment opportunities galore out there right now. Real estate is now down about 30% nationally not 16%. It is down 16% just in the last year not since the real estate market peaked in 2006.
Our record is on the web going back more than four years. You can search for it on the web under "Suite 101" plus "BoltonCT" or also plus "respiral". Our record is pretty good and right now it probably is clear that we have another stock market bubble. Volume is so low that a small amount of buying has driven stock prices up 80% in some sectors since this past March. That happened in the Great Depression too. And then stocks hit an even lower bottom. Get smart and get out with profits while we can.
American technological creativity is now being crushed by Obama's socialist legislation
Creating a depression is no small effort. The USA has had dozens of stock market panics and recessions but just one depression. FDR started out thinking European socialism was great and he took a bad recession and made it into an economic depression just like they had in the other European socialist nations. We now have left wing socialists at the helm of most of the world economies. They live in a make-believe fantasy world.
1) They want to redistribute wealth from the creative, smart, and productive populations to the laid back, ignorant, and corrupt con artist sub cultures. Haven't you gotten dozens of scam emails like the rest of us?
2) They want to use cap and trade to redistribute wealth using the hoax that productive populations are causing a global meltdown when this glacial cycle has happened more than ten times on earth before mankind even evolved.
3) They want to have your personal health and financial records computerized so that the corrupt politicians can have access to it to make sure you follow the rules and give to them and do what they demand.
4) They are willing to destroy the best health care system on planet Earth so that 40million people who already get free health care in America will get it as an entitlement. They will then be entitled to bog down the system because it will be their right, not a gift from the producers and workers of America.
5) Our medical and other research programs are the envy of the world but they intend to shut it down to pay for their redistribution of wealth. They are so stupid that they say that the research only benefits the rich.
6) They plan to put the whole burden on Americans who do the work that has made America the richest nation on the planet. Essentially they want to control and effectively enslave the productive people as the failed Soviet Empire did until the people realized that it was a lunatic make-believe existence where the workers pretended to work, the government pretended to pay them, and the dissidents were sent to the Gulag prison system to be beaten and freeze to death. When the Soviets conquered East Germany they dismantled the factories and rolled fragile sophisticated German machinery into boxcars literally rendering the equipment useless to East Germany and the Soviet Union. America did the opposite and made friends of our enemies. When the iron curtain came down we discovered they had acquired our sophisticate jet engines and could not even copy our technology because they lacked knowledge. We discovered that the jet engines of the Foxbat only lasted the length of the flight when they set records. American military engines that set records lasted 10,000 hrs and our commercial engines last 30,000 hrs.
Bush inherited a recession and a terrorist attack after Clinton who exposed us to attack by substantially dismantling the CIA, FBI, and our military. Bush gave us tax cuts, strengthened the economy and kept us out of a depression. He left Obama a recession and Obama called it a depression to make Bush look bad, to undermine confidence in the banks and to get himself elected. No previous political campaign since the great depression ever endangered America's economic health that way.
President Obama thinks European socialism is the answer and he took a bad recession and is now making it into an economic depression by dismantling the American economic engine of creative destruction, free enterprise, and liberty. Yes, American creativity is so rapid that before socialist nations can copy what we do we have destroyed yesterday's technology by making it obsolete. That is how we survived Japanese copycats, China's piracy and theft of software etc. Yes American technological creativity is now being crushed by Obama socialist legislation.
Market forces August 14
The Wall Street euphoria had been based on their assumption that the socialist destruction of the worlds best medical system will fail. But the socialists are actually dismantling the American engine of creative destruction, free enterprise, and liberty. Hover gave RDR a recession and socialism made it into a depression until WWII forced FDR to restore the American engine of creative destruction, free enterprise, and liberty. President Obama has stated that we must be more like the European socialists and he now completely controls the political machinery.
It is going to get a lot worse when Obama succeeds with his legislation. Those pump and dump stock market "let the good times roll" spinners are setting investors up for another market blood bath because they are not even as smart as the Obama socialists.
Market Outlook
A panic sell off of 25% in one day similar to 1987 is now a growing risk.
Hundreds of billions of dollars are flowing to the sectors of the American population that have the least skill at managing money. It is a bailout of all the folks who defraud credit companies and banks. It is a bail out of all the folks that Senators Rangle and Dodd said should be given houses "no questions asked about affordability." We are seeing many on Wall Street getting multi million dollar bonuses for their part in the corruption of mortgage investment instruments. We are seeing federal tax cheats appointed to oversee the US finances. We see no attempt to monitor the $Trillions being thrown into the black hole of redistribution. They are still allowing mortgages "no questions asked."
If it were not for the incompetence of all the many socialist and communist governments of the world the incompetent American government would be under water today. The socialist world is like a high school where all the lazy, cheaters, and mediocre majority get together and hassle the good students to study less. That way they get the grades lowered and achieve greater equality. That makes the good teacher looks too strict and the lazy get to look like average students. They thus eliminate the inequality of grades caused by good students and achieve the equality of mediocrity. Obama is moving America from the inequality of affluence toward the equality of world poverty. The USA has a long way to fall because the USA used to be the world's best student.
Yesterday had continuing indications of the market topping out. Volume declined another 5% and the high for the day was no higher than the high the previous day. The spiral or parabolic SAR indicated the time to sell on August 11 and the MACD dropped to zero for the last two days. Once both go negative the buying window will be shut based on the methodology "respiral" we have documented since early 2007.
We definitely see bubble psychology everywhere again. We would not buy at these elevated prices but instead seek alternative investments such as corporate bonds except when individual stocks correct (more than 10%) and offer real buying opportunities. The recent rally has the market in an extremely overbought and exhausted position again. If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were down from the previous day: Communist China down -3%, socialist Japan up 0.7%, oligarchy Hong Kong up 0.2%, theocracy Jakarta down -0.4%, and socialist India down -0.7%.
Today most of the socialist European markets are up in a range of 0.2% to 0.6% half way through their session.
US futures indicate a slightly lower USA market opening this morning. The financial sector is particularly overbought with commercial debt about to crash through the roofs.
We anticipate a panic spike down any time now as a potential buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market. Buy after they deflate a sector when there are bargains. The hedge funds move quickly in and out so after they move in it is usually too late.
US stocks are up 47% and emerging markets are up 80% in just five months so be careful.
At market bottoms they scare you into selling. At market tops they tell you that it is a good time to buy even at the peaks after a run-up of 48% in three months. They churn investors at the top.
No one needs to be told how the con men can twist facts and words to sell someone a lemon or a clunker. We know the same people who said buy-buy-buy all through 2007 and 2008 are out there right now saying buy-buy-buy. That is the only thing they know because they generally invest very poorly themselves and depend on the rest of us for their commissions or their TV entertainment income. They are terrible investors themselves or they would not be working for our commissions or entertaining us. And so they have a clear conflict of interest. They must sell you a bag of goods in order to make a living. And so they also spin everything positive when things are going up and then they scare the pants off of us when things are going down. That is known as churning and that is what it has been called since the panics of the 1800's. Right now they are selling us stocks that in their business they call pigs with lipstick.
Churning refers to moving stocks when there is nothing financially going on that justifies investment activity. Churning is how many get commissions while actually providing a disservice to investors. That is what they have been doing for months now.
Well, folks we have other alternatives. There are bond funds that are doing much better than the bank and there are RE partnerships and direct real estate investment opportunities galore out there right now. Real estate is now down about 30% nationally not 16%. It is down 16% just in the last year not since the real estate market peaked in 2006.
Our record is on the web going back more than four years. You can search for it on the web under "Suite 101" plus "BoltonCT" or also plus "respiral". Our record is pretty good and right now it probably is clear that we have another stock market bubble. Volume is so low that a small amount of buying has driven stock prices up 80% in some sectors since this past March. That happened in the Great Depression too. And then stocks hit an even lower bottom. Get smart and get out with profits while we can.
American technological creativity is now being crushed by Obama's socialist legislation
Creating a depression is no small effort. The USA has had dozens of stock market panics and recessions but just one depression. FDR started out thinking European socialism was great and he took a bad recession and made it into an economic depression just like they had in the other European socialist nations. We now have left wing socialists at the helm of most of the world economies. They live in a make-believe fantasy world.
1) They want to redistribute wealth from the creative, smart, and productive populations to the laid back, ignorant, and corrupt con artist sub cultures. Haven't you gotten dozens of scam emails like the rest of us?
2) They want to use cap and trade to redistribute wealth using the hoax that productive populations are causing a global meltdown when this glacial cycle has happened more than ten times on earth before mankind even evolved.
3) They want to have your personal health and financial records computerized so that the corrupt politicians can have access to it to make sure you follow the rules and give to them and do what they demand.
4) They are willing to destroy the best health care system on planet Earth so that 40million people who already get free health care in America will get it as an entitlement. They will then be entitled to bog down the system because it will be their right, not a gift from the producers and workers of America.
5) Our medical and other research programs are the envy of the world but they intend to shut it down to pay for their redistribution of wealth. They are so stupid that they say that the research only benefits the rich.
6) They plan to put the whole burden on Americans who do the work that has made America the richest nation on the planet. Essentially they want to control and effectively enslave the productive people as the failed Soviet Empire did until the people realized that it was a lunatic make-believe existence where the workers pretended to work, the government pretended to pay them, and the dissidents were sent to the Gulag prison system to be beaten and freeze to death. When the Soviets conquered East Germany they dismantled the factories and rolled fragile sophisticated German machinery into boxcars literally rendering the equipment useless to East Germany and the Soviet Union. America did the opposite and made friends of our enemies. When the iron curtain came down we discovered they had acquired our sophisticate jet engines and could not even copy our technology because they lacked knowledge. We discovered that the jet engines of the Foxbat only lasted the length of the flight when they set records. American military engines that set records lasted 10,000 hrs and our commercial engines last 30,000 hrs.
Bush inherited a recession and a terrorist attack after Clinton who exposed us to attack by substantially dismantling the CIA, FBI, and our military. Bush gave us tax cuts, strengthened the economy and kept us out of a depression. He left Obama a recession and Obama called it a depression to make Bush look bad, to undermine confidence in the banks and to get himself elected. No previous political campaign since the great depression ever endangered America's economic health that way.
President Obama thinks European socialism is the answer and he took a bad recession and is now making it into an economic depression by dismantling the American economic engine of creative destruction, free enterprise, and liberty. Yes, American creativity is so rapid that before socialist nations can copy what we do we have destroyed yesterday's technology by making it obsolete. That is how we survived Japanese copycats, China's piracy and theft of software etc. Yes American technological creativity is now being crushed by Obama socialist legislation.
Market forces August 14
The Wall Street euphoria had been based on their assumption that the socialist destruction of the worlds best medical system will fail. But the socialists are actually dismantling the American engine of creative destruction, free enterprise, and liberty. Hover gave RDR a recession and socialism made it into a depression until WWII forced FDR to restore the American engine of creative destruction, free enterprise, and liberty. President Obama has stated that we must be more like the European socialists and he now completely controls the political machinery.
It is going to get a lot worse when Obama succeeds with his legislation. Those pump and dump stock market "let the good times roll" spinners are setting investors up for another market blood bath because they are not even as smart as the Obama socialists.
Market Outlook
A panic sell off of 25% in one day similar to 1987 is now a growing risk.
Hundreds of billions of dollars are flowing to the sectors of the American population that have the least skill at managing money. It is a bailout of all the folks who defraud credit companies and banks. It is a bail out of all the folks that Senators Rangle and Dodd said should be given houses "no questions asked about affordability." We are seeing many on Wall Street getting multi million dollar bonuses for their part in the corruption of mortgage investment instruments. We are seeing federal tax cheats appointed to oversee the US finances. We see no attempt to monitor the $Trillions being thrown into the black hole of redistribution. They are still allowing mortgages "no questions asked."
If it were not for the incompetence of all the many socialist and communist governments of the world the incompetent American government would be under water today. The socialist world is like a high school where all the lazy, cheaters, and mediocre majority get together and hassle the good students to study less. That way they get the grades lowered and achieve greater equality. That makes the good teacher looks too strict and the lazy get to look like average students. They thus eliminate the inequality of grades caused by good students and achieve the equality of mediocrity. Obama is moving America from the inequality of affluence toward the equality of world poverty. The USA has a long way to fall because the USA used to be the world's best student.
Yesterday had continuing indications of the market topping out. Volume declined another 5% and the high for the day was no higher than the high the previous day. The spiral or parabolic SAR indicated the time to sell on August 11 and the MACD dropped to zero for the last two days. Once both go negative the buying window will be shut based on the methodology "respiral" we have documented since early 2007.
We definitely see bubble psychology everywhere again. We would not buy at these elevated prices but instead seek alternative investments such as corporate bonds except when individual stocks correct (more than 10%) and offer real buying opportunities. The recent rally has the market in an extremely overbought and exhausted position again. If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were down from the previous day: Communist China down -3%, socialist Japan up 0.7%, oligarchy Hong Kong up 0.2%, theocracy Jakarta down -0.4%, and socialist India down -0.7%.
Today most of the socialist European markets are up in a range of 0.2% to 0.6% half way through their session.
US futures indicate a slightly lower USA market opening this morning. The financial sector is particularly overbought with commercial debt about to crash through the roofs.
We anticipate a panic spike down any time now as a potential buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market. Buy after they deflate a sector when there are bargains. The hedge funds move quickly in and out so after they move in it is usually too late.
US stocks are up 47% and emerging markets are up 80% in just five months so be careful.
Thursday, August 13, 2009
Wall Street is betting on Obama failing
The crisis is not the economy it is the socialist administration in office. But Wall Street is now counting on Obama failing.
Yesterday started with fraudulently spun reporting to all investors saying housing prices rose for the first time this year and the recession bottom was past history. Later the false information was corrected and in fact home prices dropped again on a month to month as well as a year to year basis. Indeed an international bank calculated that more than 25% of American mortgages were now underwater and it would rise to 40% underwater before the recession ended. Later all the news outlets issued corrections similar to the following.
U.S. Foreclosure Filings Set Third Record-High in Five Months
By Dan Levy, Aug. 13 (Bloomberg) -- Foreclosure filings in the U.S. climbed to a record for the third time in five months in July as falling home prices and the recession left more homeowners unable to keep up payments or refinance. A total of 360,149 properties received a default or auction notice or were seized last month, according to data seller RealtyTrac Inc. One in 355 households got a filing, the highest monthly rate in RealtyTrac records dating to January 2005, the Irvine, California-based company said in a statement.
“We’re in a deep hole,” Diane Swonk, chief economist at Chicago-based Mesirow Financial Inc., said in an interview. “There is a whole new wave of foreclosures tied to the cyclical dynamics of the economy.”
The median price of an existing single-family house to $174,100 in the second quarter, the most in records dating to 1979, the National Association of Realtors said yesterday. Almost one-quarter of U.S. mortgage holders are underwater, property data firm Zillow.com said Aug. 11.
“There are a slew of factors showing fundamental weakness on the demand side: tighter underwriting, job loss, investors who’ve been badly burned,” said Stuart Gabriel, director of the UCLA Ziman Center for Real Estate in Los Angeles. “We have not seen the bottom of the housing market.”
Market forces August 13
The Wall Street euphoria has been based on their assumption that the socialist destruction of the worlds best medical system will fail. Health care stocks have surged including the insurance companies that ultimately will be forced out of business when the bill passes. Stocks like insolvent profitless Hartford Insurance have tripled in price as investors wish and bet on an Obama failure. Recent public protests against the new entitlements and redistribution of wealth to the indigent have encouraged investors as well, but the socialists have majorities in both houses and the weak Republicans in congress want to compromise again. The socialists cannot lose until the 2010 election.
Sales continue to be flat except for the temporary car clunker $2Billion stimulus program. And that is flat even though the stimulus package is projected to put us at a $13Trillion dollar national debt. People on welfare are the primary recipients of the stimulus program as of reports yesterday. The new socialist system will cut checks to the "don't worry be-happy life" life stile voting block as working Americans pay higher taxes. Isn't that the definition of slavery? Yes, but in past slavery the slave owners were producers not of the "don't worry be-happy" folks. It seems like this administration is creating a new kind of Banana Republic.
Market Outlook
Yesterday was somewhat inconclusive so we will have to see what today brings us. Yesterday had all the indications of the market topping out. Volume was lackluster on early positive misinformation and then lost 30% of its gains in the last hour on high volume. The spiral or parabolic SAR said sell on August 11 and the MACD dropped to zero yesterday; not quite negative territory yet. It looked like a failed attempt to panic more investors into the market. That being said we concluded it was a failed retest of the market high. We definitely see bubble psychology under way. We would not buy at these elevated prices but instead seek alternative investments such as corporate bonds except when individual stocks correct and offer buying opportunities.
The recent rally has the market in a highly overbought position again. We expect U.S. stock buying opportunities and then wild optimistic appreciation (as we have now) that are times to take profits. This may very well be a positive consolidation period not a negative distribution period. But it would be unusual not to have a sharp sell off panic from time to time. Summer and early fall are usually times when markets decline.
If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were rebounded slightly from sharp losses the previous day: Communist China up 2.1%, socialist Japan up 0.8%, oligarchy Hong Kong up 2.1%, and socialist India up 3.3$%.
Today most of the socialist European markets are up in a range of 1.2% to 1.9% half way through their session.
US futures indicate a higher USA market opening again this morning. The financial sector is particularly overbought with commercial debt about to crash through the roofs.
We anticipate a panic spike down any time now as a buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market. Buy after they deflate a sector when there are bargains. The hedge funds move quickly in and out so after they move in it is usually too late.
US stocks are up 47% and emerging markets are up 80% in just five months so be careful.
Yesterday started with fraudulently spun reporting to all investors saying housing prices rose for the first time this year and the recession bottom was past history. Later the false information was corrected and in fact home prices dropped again on a month to month as well as a year to year basis. Indeed an international bank calculated that more than 25% of American mortgages were now underwater and it would rise to 40% underwater before the recession ended. Later all the news outlets issued corrections similar to the following.
U.S. Foreclosure Filings Set Third Record-High in Five Months
By Dan Levy, Aug. 13 (Bloomberg) -- Foreclosure filings in the U.S. climbed to a record for the third time in five months in July as falling home prices and the recession left more homeowners unable to keep up payments or refinance. A total of 360,149 properties received a default or auction notice or were seized last month, according to data seller RealtyTrac Inc. One in 355 households got a filing, the highest monthly rate in RealtyTrac records dating to January 2005, the Irvine, California-based company said in a statement.
“We’re in a deep hole,” Diane Swonk, chief economist at Chicago-based Mesirow Financial Inc., said in an interview. “There is a whole new wave of foreclosures tied to the cyclical dynamics of the economy.”
The median price of an existing single-family house to $174,100 in the second quarter, the most in records dating to 1979, the National Association of Realtors said yesterday. Almost one-quarter of U.S. mortgage holders are underwater, property data firm Zillow.com said Aug. 11.
“There are a slew of factors showing fundamental weakness on the demand side: tighter underwriting, job loss, investors who’ve been badly burned,” said Stuart Gabriel, director of the UCLA Ziman Center for Real Estate in Los Angeles. “We have not seen the bottom of the housing market.”
Market forces August 13
The Wall Street euphoria has been based on their assumption that the socialist destruction of the worlds best medical system will fail. Health care stocks have surged including the insurance companies that ultimately will be forced out of business when the bill passes. Stocks like insolvent profitless Hartford Insurance have tripled in price as investors wish and bet on an Obama failure. Recent public protests against the new entitlements and redistribution of wealth to the indigent have encouraged investors as well, but the socialists have majorities in both houses and the weak Republicans in congress want to compromise again. The socialists cannot lose until the 2010 election.
Sales continue to be flat except for the temporary car clunker $2Billion stimulus program. And that is flat even though the stimulus package is projected to put us at a $13Trillion dollar national debt. People on welfare are the primary recipients of the stimulus program as of reports yesterday. The new socialist system will cut checks to the "don't worry be-happy life" life stile voting block as working Americans pay higher taxes. Isn't that the definition of slavery? Yes, but in past slavery the slave owners were producers not of the "don't worry be-happy" folks. It seems like this administration is creating a new kind of Banana Republic.
Market Outlook
Yesterday was somewhat inconclusive so we will have to see what today brings us. Yesterday had all the indications of the market topping out. Volume was lackluster on early positive misinformation and then lost 30% of its gains in the last hour on high volume. The spiral or parabolic SAR said sell on August 11 and the MACD dropped to zero yesterday; not quite negative territory yet. It looked like a failed attempt to panic more investors into the market. That being said we concluded it was a failed retest of the market high. We definitely see bubble psychology under way. We would not buy at these elevated prices but instead seek alternative investments such as corporate bonds except when individual stocks correct and offer buying opportunities.
The recent rally has the market in a highly overbought position again. We expect U.S. stock buying opportunities and then wild optimistic appreciation (as we have now) that are times to take profits. This may very well be a positive consolidation period not a negative distribution period. But it would be unusual not to have a sharp sell off panic from time to time. Summer and early fall are usually times when markets decline.
If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were rebounded slightly from sharp losses the previous day: Communist China up 2.1%, socialist Japan up 0.8%, oligarchy Hong Kong up 2.1%, and socialist India up 3.3$%.
Today most of the socialist European markets are up in a range of 1.2% to 1.9% half way through their session.
US futures indicate a higher USA market opening again this morning. The financial sector is particularly overbought with commercial debt about to crash through the roofs.
We anticipate a panic spike down any time now as a buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market. Buy after they deflate a sector when there are bargains. The hedge funds move quickly in and out so after they move in it is usually too late.
US stocks are up 47% and emerging markets are up 80% in just five months so be careful.
Wednesday, August 12, 2009
Today the market is at a critical juncture
T minus zero.
We believe another 10%+ pullback is desirable at this point for the longer-term health of the market.
This year has seen an 80% surge in communist/socialist emerging market stocks, while the dollar has posted a decline. A declining dollar and surging emerging markets were the hallmarks of the credit-fueled stock bubble earlier this decade. Recent weeks have brought huge rallies in some of the lowest-quality American stocks such as AIG, Fannie Mae and Freddie Mac that are being propped up by the government and are unlikely to return to health any time soon. The market recently has behaved as though the FED has inflated a stock market bubble. It can consolidate now or it can be bid up to a panic collapse this fall.
When the Federal Reserve announces results of its policymaking meeting today, it is all but certain to leave its target for short-term interest rates near zero, and likely will indicate that it intends to keep rates there longer. The question is will the Fed offer a plan for how the central bank will unwind its inflationary interventions that prop up the economy while allowing the overhang of the impending avalanche of commercial and residential debt to unwind next. Financial crises usually come in unpredictable waves, and the Fed leaders still must deal with considerable risks that the economic decline could easily tip into a double-dip recession or stagflation as seen under the "malaise" of Jimmy Carter.
The breadth of the market advance to date has been very narrow and manipulated by the funds. That is why few people are feeling the worst is over. The stock market tipped negatively under increasing volume these past two days. Today we are at a decision point.
Stocks have surged even as employment continues to fall and unemployment exceeds 16 % when those who have given up or have exhausted their benefits are included. The rate of layoffs is still five times higher than the highest the Bush administration experienced. President Obama is recently seen as already a failed president whose main focus is on switching 40million of his supporters from the worlds most successful and charitable regulated private health care system to the standard slow and inept socialized system where his mostly 40million indigent but formally grateful supporters will take the funds from the aging population of workers who actually paid for the health system. Obama's 40million special interest supporters now outnumber the aging people who built the system. The new system modeled on that of Middle Eastern socialist theocracies believes wealth is a gift from Allah just like oil. It is an unearned gift, an entitlement that should be distributed just like unemployment insurance to the masses. The new America under the Obama dream will have 30% unemployment hidden by the fact that work is the least popular life style of the third world. Relax, be happy is the most popular life style of socialism in the world. Entitlements are undermining free enterprise and human rights throughout the world and are dependent on a vast bureaucracy of generally incompetent and dangerous leaders who usually are elected by vast majorities as Lenin, Hitler, Stalin, and Saddam Hussein were. That is because electorates typically prefer handouts not productive work.
The Federal Reserve has spent the past year cleaning up after a housing bubble it and the Senate Banking Commission had created. But along the way it may have pumped up another bubble, the stock market. The central bank has slashed interest rates while funneling money to banks. Stocks have bounced back with startling speed as distressed corporate takeovers have more than doubled pumping money into the stock market.
Economist David Rosenberg, who notes that consumer credit has dropped an unprecedented five straight months, said it's far from clear the recession is over. He says the risk of a market relapse later this year is high. He wrote in a note to clients Monday,
"This is the most speculative momentum-driven equity market since the early 1930s. We see this as the Fed has been financing the speculative mania that could end in another damaging rout."
Given free money, investors' appetite for risk shoots higher and they gobble up stocks. Unfortunately economic growth doesn't seem to support the higher stock values. That is a bubble that pops when the excesses of band loans and bad investments come home.
Short-term interest rates could soon head higher, judging by action in futures markets. That could raise companies' borrowing costs and the weight of the overburden of bad debt.
Market forces August 12
The market is at a nexus. Today it decides if a new equities bubble gets out of control and pops, or if the market can consolidate into a stronger value based portfolio.
Market Outlook
For more than a month now we have advised taking profits and getting out of the emerging markets. We were first to say they would lead us out of the recession and now we say they have become mine fields for investor losses.
The recent rally has the market in a highly overbought position again. We expect U.S. stock buying opportunities and then wild optimistic appreciation (as we have now) that are times to take profits. This may very well be a positive consolidation period not a negative distribution period. But it would be unusual not to have a sharp sell off panic from time to time. Summer and early fall is usually a time when markets decline.
If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
The communist/socialist economies of the third world are driven by American imports. Communist China's bureaucracy with an 8% growth rate is wasting its money on car production while embarrassing corporate executives are beaten to death by their masses or shot by the government! We recommended emerging markets more than six months ago and have warned readers to get out of emerging markets now for over a month. Last night Asian markets were down sharply: communist China down -4.7%, socialist Japan down -1.4%, oligarchy Hong Kong down -3%, theocratic Jakarta down -2.2%, and socialist India down -0.4%.
Today most of the socialist European markets are presently flat in a range of -0.1% to +0.5% half way through their session.
US futures indicate a slightly higher USA market opening this morning. The financial sector is particularly overbought with commercial debt about to crash through the roofs.
The new socialist indigent entitlement proponents seemingly destroy every free market sector that they touch as they strive to make America into a laid back don't worry be happy third world country. Hedge funds seem to be betting that the Obama entitlement bills fail. But if his socialized medicine passes in any form whatsoever we expect health care stocks to implode as they did when Obama first announced his plan. Communists and socialists think "profit" is a dirty word. Mediocrity reigns greatest where inept and corrupt socialist governments rule. Look primarily at Africa and the Middle East for this administration's vision not Europe.
Anticipate a panic spike down any time now as a buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market.
We believe another 10%+ pullback is desirable at this point for the longer-term health of the market.
This year has seen an 80% surge in communist/socialist emerging market stocks, while the dollar has posted a decline. A declining dollar and surging emerging markets were the hallmarks of the credit-fueled stock bubble earlier this decade. Recent weeks have brought huge rallies in some of the lowest-quality American stocks such as AIG, Fannie Mae and Freddie Mac that are being propped up by the government and are unlikely to return to health any time soon. The market recently has behaved as though the FED has inflated a stock market bubble. It can consolidate now or it can be bid up to a panic collapse this fall.
When the Federal Reserve announces results of its policymaking meeting today, it is all but certain to leave its target for short-term interest rates near zero, and likely will indicate that it intends to keep rates there longer. The question is will the Fed offer a plan for how the central bank will unwind its inflationary interventions that prop up the economy while allowing the overhang of the impending avalanche of commercial and residential debt to unwind next. Financial crises usually come in unpredictable waves, and the Fed leaders still must deal with considerable risks that the economic decline could easily tip into a double-dip recession or stagflation as seen under the "malaise" of Jimmy Carter.
The breadth of the market advance to date has been very narrow and manipulated by the funds. That is why few people are feeling the worst is over. The stock market tipped negatively under increasing volume these past two days. Today we are at a decision point.
Stocks have surged even as employment continues to fall and unemployment exceeds 16 % when those who have given up or have exhausted their benefits are included. The rate of layoffs is still five times higher than the highest the Bush administration experienced. President Obama is recently seen as already a failed president whose main focus is on switching 40million of his supporters from the worlds most successful and charitable regulated private health care system to the standard slow and inept socialized system where his mostly 40million indigent but formally grateful supporters will take the funds from the aging population of workers who actually paid for the health system. Obama's 40million special interest supporters now outnumber the aging people who built the system. The new system modeled on that of Middle Eastern socialist theocracies believes wealth is a gift from Allah just like oil. It is an unearned gift, an entitlement that should be distributed just like unemployment insurance to the masses. The new America under the Obama dream will have 30% unemployment hidden by the fact that work is the least popular life style of the third world. Relax, be happy is the most popular life style of socialism in the world. Entitlements are undermining free enterprise and human rights throughout the world and are dependent on a vast bureaucracy of generally incompetent and dangerous leaders who usually are elected by vast majorities as Lenin, Hitler, Stalin, and Saddam Hussein were. That is because electorates typically prefer handouts not productive work.
The Federal Reserve has spent the past year cleaning up after a housing bubble it and the Senate Banking Commission had created. But along the way it may have pumped up another bubble, the stock market. The central bank has slashed interest rates while funneling money to banks. Stocks have bounced back with startling speed as distressed corporate takeovers have more than doubled pumping money into the stock market.
Economist David Rosenberg, who notes that consumer credit has dropped an unprecedented five straight months, said it's far from clear the recession is over. He says the risk of a market relapse later this year is high. He wrote in a note to clients Monday,
"This is the most speculative momentum-driven equity market since the early 1930s. We see this as the Fed has been financing the speculative mania that could end in another damaging rout."
Given free money, investors' appetite for risk shoots higher and they gobble up stocks. Unfortunately economic growth doesn't seem to support the higher stock values. That is a bubble that pops when the excesses of band loans and bad investments come home.
Short-term interest rates could soon head higher, judging by action in futures markets. That could raise companies' borrowing costs and the weight of the overburden of bad debt.
Market forces August 12
The market is at a nexus. Today it decides if a new equities bubble gets out of control and pops, or if the market can consolidate into a stronger value based portfolio.
Market Outlook
For more than a month now we have advised taking profits and getting out of the emerging markets. We were first to say they would lead us out of the recession and now we say they have become mine fields for investor losses.
The recent rally has the market in a highly overbought position again. We expect U.S. stock buying opportunities and then wild optimistic appreciation (as we have now) that are times to take profits. This may very well be a positive consolidation period not a negative distribution period. But it would be unusual not to have a sharp sell off panic from time to time. Summer and early fall is usually a time when markets decline.
If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
The communist/socialist economies of the third world are driven by American imports. Communist China's bureaucracy with an 8% growth rate is wasting its money on car production while embarrassing corporate executives are beaten to death by their masses or shot by the government! We recommended emerging markets more than six months ago and have warned readers to get out of emerging markets now for over a month. Last night Asian markets were down sharply: communist China down -4.7%, socialist Japan down -1.4%, oligarchy Hong Kong down -3%, theocratic Jakarta down -2.2%, and socialist India down -0.4%.
Today most of the socialist European markets are presently flat in a range of -0.1% to +0.5% half way through their session.
US futures indicate a slightly higher USA market opening this morning. The financial sector is particularly overbought with commercial debt about to crash through the roofs.
The new socialist indigent entitlement proponents seemingly destroy every free market sector that they touch as they strive to make America into a laid back don't worry be happy third world country. Hedge funds seem to be betting that the Obama entitlement bills fail. But if his socialized medicine passes in any form whatsoever we expect health care stocks to implode as they did when Obama first announced his plan. Communists and socialists think "profit" is a dirty word. Mediocrity reigns greatest where inept and corrupt socialist governments rule. Look primarily at Africa and the Middle East for this administration's vision not Europe.
Anticipate a panic spike down any time now as a buying opportunity. We must be capturing profits on the rallies and then finding better buys on the declines. That is called cherry picking the best buys. We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite.
Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market.
Tuesday, August 11, 2009
Countdown at X minus one
There will be a correction very soon or prices will get so overbought that there will be a stock market panic again.
No one in the current administration knows what is going on as they throw money at everything hand over fist. See this example of lack of oversight.
http://dailybail.com/home/there-are-no-words-to-describe-the-following-part-ii.html
Lack of oversight goes with corruption. Corruption of government leads to economic failure.
Market forces August 11
The communist and socialist nations support the looting of the USA as a way of destroying worldwide free enterprise and individual freedom and establishing a world socialist state without the need for a war. Inflation is the way the socialist loot productive workers. It creates capital gains to push people into higher tax brackets and to create fictitious income.
600,000 unemployed to have unemployment benefits expire this month unless its term is extended again.
Market Outlook
The recent rally has the market in a highly overbought position again. We expect U.S. stocks to continue with slides that represent buying opportunities and then wild optimistic appreciation (as we have now) that can be times to take profits. This may very well be a consolidation period not a distribution period. That means that the sharp drops in some sectors may be funds cleaning out the sellers. But it that is true it would be unusual not to have a sharp sell off panic from time to time. Summer and early fall is usually a time when markets decline.
If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were up slightly: communist China up 0.7%, socialist Japan up 0.6%, and socialist India up 0.4%.
Today most of the socialist European markets are flat in a range of 0% to 0.4% half way through their session.
US futures indicate a slightly lower USA market opening this morning.
Anticipate a panic spike down any time now as a buying opportunity. For instance, stocks that have gapped up and rose sharply often drop down to close the gap. A gap is when a stock opens much higher than at any time the previous day and has not yet been covered by a subsequent decline.
We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite. Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market.
The new socialist administration seemingly destroys every free market sector they touch. Hedge funds seem to be betting that the Obama bill fails. But if his socialized medicine passes in any form whatsoever we expect health care stocks to implode as they did when Obama first announced his plan. Communists and socialists think "profit" is a dirty word. Mediocrity reigns greatest where inept and corrupt socialist governments rule.
No one in the current administration knows what is going on as they throw money at everything hand over fist. See this example of lack of oversight.
http://dailybail.com/home/there-are-no-words-to-describe-the-following-part-ii.html
Lack of oversight goes with corruption. Corruption of government leads to economic failure.
Market forces August 11
The communist and socialist nations support the looting of the USA as a way of destroying worldwide free enterprise and individual freedom and establishing a world socialist state without the need for a war. Inflation is the way the socialist loot productive workers. It creates capital gains to push people into higher tax brackets and to create fictitious income.
600,000 unemployed to have unemployment benefits expire this month unless its term is extended again.
Market Outlook
The recent rally has the market in a highly overbought position again. We expect U.S. stocks to continue with slides that represent buying opportunities and then wild optimistic appreciation (as we have now) that can be times to take profits. This may very well be a consolidation period not a distribution period. That means that the sharp drops in some sectors may be funds cleaning out the sellers. But it that is true it would be unusual not to have a sharp sell off panic from time to time. Summer and early fall is usually a time when markets decline.
If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were up slightly: communist China up 0.7%, socialist Japan up 0.6%, and socialist India up 0.4%.
Today most of the socialist European markets are flat in a range of 0% to 0.4% half way through their session.
US futures indicate a slightly lower USA market opening this morning.
Anticipate a panic spike down any time now as a buying opportunity. For instance, stocks that have gapped up and rose sharply often drop down to close the gap. A gap is when a stock opens much higher than at any time the previous day and has not yet been covered by a subsequent decline.
We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite. Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market.
The new socialist administration seemingly destroys every free market sector they touch. Hedge funds seem to be betting that the Obama bill fails. But if his socialized medicine passes in any form whatsoever we expect health care stocks to implode as they did when Obama first announced his plan. Communists and socialists think "profit" is a dirty word. Mediocrity reigns greatest where inept and corrupt socialist governments rule.
Monday, August 10, 2009
Countdown is at X minus two
GE leaped 10.4% while we were away five business days. It appears that GE's financial sector will now survive intact. GE-Wal-Mart working together could be a very profitable partnership.
We're back and we think this market has at best two more days of life. Why? Because this eighteen-day rally seems too good to be true given the oversold condition and the history of major market lows occurring in September and October.
Does the market have to go down now? Certainly not! It could first explode upwards in a massive bull market trap and then collapse in a wild panic as it has done so many times especially in the 1930's and 1970's. In the later part of the 1970's many new investors bought in after Lyndon Johnson's massive "guns and butter" spending spree were so confident that they were far out on the limb on margin driving stock prices higher when in two late summer panic years they lost everything.
No if the market does not begin a correction before August 13 we expect another run-up and then a panic. GE is also in a particularly lucrative position as the owner of GE/MSNBC/Pravda which gives corrupt American politicians $billions in free continuous lobbing support and well as campaign attacks on anyone interested in American free enterprise or government fiscal responsibility.
Lately the Democrat-Socialist Congressman have come up with conspiracy theories saying that people who do not like their slow communist takeover are not middle class working taxpayers but the decadent conspiring bourgeois instead. They are true Marxists-Leninists when it comes to suppressing the minority of thinking American people.
Here is Obama's response when he backed off from his decision to let the military pay for their own medical expenses... what an empty headed person he must be... send this to everyone you know to show them just what he thinks of our military who fight for our country and get hurt and killed protecting our freedom!
Check out Snopes.com's response to this message at:
http://www.snopes.com/politics/obama/veteranshealth.asp
"Bad press led to President Obama abandoning his proposal to require veterans carry private health insurance to cover the estimated $540 million annual cost to the federal government of treatment for injuries to military personnel received during their tours on active duty.
The President admitted that he was puzzled by the magnitude of the opposition to his proposal."Look, it's an all volunteer force," Obama complained… "Nobody made these guys go to war. They had to have known and accepted the risks. Now they whine about bearing the costs of their choice? It doesn't compute...”
"I thought these were people who were proud to sacrifice for their country," Obama continued. "I wasn't asking for blood, just money. With the country facing the worst financial crisis in its history, I'd have thought that the patriotic thing to do would be to try to help reduce the nation's deficit. I guess I underestimated the selfishness of some of my fellow Americans.""
Two things are infinite: the universe and human stupidity; and I'm not sure about the universe.
-Churchill
Market forces August 10
The communist and socialist nations support the looting of the USA as a way of destroying worldwide free enterprise and individual freedom and establishing a world socialist state without a war. Inflation is the way the socialist loot productive workers. It creates capital gains to push people into higher tax brackets and to create fictitious income.
Market Outlook
The recent rally has the market in a highly overbought position again. We expect U.S. stocks to continue with slides that represent buying opportunities and then wild optimistic appreciation (as we have now) that can be times to take profits. This may very well be a consolidation period not a distribution period. That means that the sharp drops in some sectors may be funds cleaning out the sellers. But it that is true it would be unusual not to have a sharp sell off panic from time to time.
If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were down: communist China down - 0.4%, socialist Japan up +1.1%, and socialist India down -1%.
Today most of the socialist European markets are flat in a range of -0.6% to -1.2% half way through their session.
US futures indicate a slightly lower USA market opening this morning.
Anticipate a panic spike down any time now as a buying opportunity. For instance, stocks that have gapped up and rose sharply often drop down to close the gap. A gap is when a stock opens much higher than at any time the previous day.
We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite. Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market.
The new socialist administration seemingly destroys every free market sector they touch. Hedge funds seem to be betting that the Obama bill fails. But if his socialized medicine passes in any form whatsoever we expect health care stocks to implode as they did when Obama first announced his plan. Communists and socialists think "profit" is a dirty word.
We're back and we think this market has at best two more days of life. Why? Because this eighteen-day rally seems too good to be true given the oversold condition and the history of major market lows occurring in September and October.
Does the market have to go down now? Certainly not! It could first explode upwards in a massive bull market trap and then collapse in a wild panic as it has done so many times especially in the 1930's and 1970's. In the later part of the 1970's many new investors bought in after Lyndon Johnson's massive "guns and butter" spending spree were so confident that they were far out on the limb on margin driving stock prices higher when in two late summer panic years they lost everything.
No if the market does not begin a correction before August 13 we expect another run-up and then a panic. GE is also in a particularly lucrative position as the owner of GE/MSNBC/Pravda which gives corrupt American politicians $billions in free continuous lobbing support and well as campaign attacks on anyone interested in American free enterprise or government fiscal responsibility.
Lately the Democrat-Socialist Congressman have come up with conspiracy theories saying that people who do not like their slow communist takeover are not middle class working taxpayers but the decadent conspiring bourgeois instead. They are true Marxists-Leninists when it comes to suppressing the minority of thinking American people.
Here is Obama's response when he backed off from his decision to let the military pay for their own medical expenses... what an empty headed person he must be... send this to everyone you know to show them just what he thinks of our military who fight for our country and get hurt and killed protecting our freedom!
Check out Snopes.com's response to this message at:
http://www.snopes.com/politics/obama/veteranshealth.asp
"Bad press led to President Obama abandoning his proposal to require veterans carry private health insurance to cover the estimated $540 million annual cost to the federal government of treatment for injuries to military personnel received during their tours on active duty.
The President admitted that he was puzzled by the magnitude of the opposition to his proposal."Look, it's an all volunteer force," Obama complained… "Nobody made these guys go to war. They had to have known and accepted the risks. Now they whine about bearing the costs of their choice? It doesn't compute...”
"I thought these were people who were proud to sacrifice for their country," Obama continued. "I wasn't asking for blood, just money. With the country facing the worst financial crisis in its history, I'd have thought that the patriotic thing to do would be to try to help reduce the nation's deficit. I guess I underestimated the selfishness of some of my fellow Americans.""
Two things are infinite: the universe and human stupidity; and I'm not sure about the universe.
-Churchill
Market forces August 10
The communist and socialist nations support the looting of the USA as a way of destroying worldwide free enterprise and individual freedom and establishing a world socialist state without a war. Inflation is the way the socialist loot productive workers. It creates capital gains to push people into higher tax brackets and to create fictitious income.
Market Outlook
The recent rally has the market in a highly overbought position again. We expect U.S. stocks to continue with slides that represent buying opportunities and then wild optimistic appreciation (as we have now) that can be times to take profits. This may very well be a consolidation period not a distribution period. That means that the sharp drops in some sectors may be funds cleaning out the sellers. But it that is true it would be unusual not to have a sharp sell off panic from time to time.
If you have been buying stocks when they were low you are finding you have some large profits now. You need to consider selling them (or enough to capture just their costs) if you do not want to lose capital when the next market panic occurs.
Last night Asian markets were down: communist China down - 0.4%, socialist Japan up +1.1%, and socialist India down -1%.
Today most of the socialist European markets are flat in a range of -0.6% to -1.2% half way through their session.
US futures indicate a slightly lower USA market opening this morning.
Anticipate a panic spike down any time now as a buying opportunity. For instance, stocks that have gapped up and rose sharply often drop down to close the gap. A gap is when a stock opens much higher than at any time the previous day.
We will continue cherry picking mostly into and now also out of the market rotating before or when the funds rotate through the sectors. We expect the decline will be a typical rotation with sharp drops in some individual stocks/sectors while other stocks/sectors bottom out or rise and then decline so the change in the market indices will be much smaller. The advances will be similar but opposite. Investing time is now compressed and hence investing requires more trading skill. We watch the sectors carefully because hedge funds seem to deflate one sector at a time and then let investors pump them back into overbought territory. They can do that best during the kind of rallies we see in this sideways market.
The new socialist administration seemingly destroys every free market sector they touch. Hedge funds seem to be betting that the Obama bill fails. But if his socialized medicine passes in any form whatsoever we expect health care stocks to implode as they did when Obama first announced his plan. Communists and socialists think "profit" is a dirty word.
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