If the media continues to report raw data we should soon see a fall off in job losses starting in March. That would help a stock market rally. Of course if they want to continue "great depression" talk and to attack Wall Street they could begin reporting seasonally adjusted data as that would now be helpful in depressing the markets. But there is at least a chance that March will bear more favorable news in spite of the Obama Administration's apparent desire to create a worldwide depression by spreading fear and financial market chaos.
Yesterday, Obama decimated the Health Care sector by announcing his plans to reduce government maximum payments for pharmaceuticals and medical procedures. The health care stocks tanked in one session. Obama has tanked the automotive stocks, the financials, the coal stocks, the oil stocks, the infrastructure stocks, the alternative energy stocks, an now the health care and medical research stocks. But Obama could continue to do this indefinitely. He could start a whole new round of selling on Monday and drive stock values down another 20% in just two or three weeks.
As we said before our analysis showed that this week (today) is when either the window for being long in stocks will slam closed or we will begin to see it open up again. What has complicated that analysis is that the decision to possibly sell out occurs just when the market is extremely oversold. Usually times when the market is oversold are technically good buying opportunities but the apparent perceived competence level of Obama and his advisors has all the financial markets and all the market sectors trembling with fear. And today President Obama will speak again. What he says will either begin the next rally or will probably have the market collapsing in free-fall next week.
In light of what President Obama has accomplished in economics to date it would only be fair to give Attila the Hun a second chance to redeem himself. Attila believed in the redistribution of wealth too. He observed that the Romans had acquired vast wealth and had selfishly kept it to themselves and did not share much of it with the Vandal Tribes that had great needs for educational opportunities, homes, and medical care. Instead the Roman welfare system only provided the illegal immagrant Vandals with food, jobs, and land. Attila started as a community activist beheading and stealing from just a few when he started his career and became a great and vastly popular leader. He was one of the great socialists of his time and redistributed the vast undeserved and obscene wealth of the Romans to the poor and down trodden.
In retrospect the only poor and down trodden people that Attila helped were the Vandal tribes that followed him. He was their messiah of the underprivileged. But he did not help the poor and down trodden of other ethnic and racial backgrounds, just the hoodlums who helped him as he systematically sacked Rome. So grieved were his followers when Attila died that many of them cut off one of their own ears to show their love and affection for their messiah. Attila brought economic and educational equality to the Roman Empire. The Romans became as poor as the Vandals and education advanced into the period now called the Dark Ages. The great socialists such as Attila the Hun, Hitler, Lenin, Mao, and Stalin invariably can rise to power because they and their followers slaughter and eat the geese that lay the golden eggs. And when they run out of domestic geese they survive by invading their neighbors and eating their geese too. The origin of our word vandalism goes back to the great socialist experiment started by Attila the Hun.
Does President Obama aspire to become a great socialist too? Today, February 27, 2009, he will talk and the stock market will interpret his capitalist or socialist intentions.
Market Outlook
The broader market indices continue their white-knuckled hold at what could be a rocky bottom or just the edge of a cliff. The recent stock market behavior could support a major advance if it continues upward today. The oversold American stock markets dropped again yesterday and the futures for today indicate a weak opening. It looks like a critical day for the market and perhaps President Obama's last chance to stop an all out stock market collapse next week.
Last night Asian markets were down with China down 1.8%, India down 0.7% but Japan up 1.5%. Hong Kong was down 0.7%.
At this moment most European markets are down 2.5% to 3.3%. Perhaps socialist Europeans recognize the current administration as one of their kind.
Friday, February 27, 2009
Thursday, February 26, 2009
Ben Bernanke yesterday declared that the banks would not be nationalized.FBI funds were cut to stop the investigation of political corruption.
Market Outlook
Irrational fear of risk has depressed markets and prices. The administration ignorance of the relationship between the equities markets and the American economy is profound. The markets lead the economy by at least six months. The more the administration tries to destroy the stock market with socialist code words the more they endanger the American economy. The administration has to become rational before the markets will become rational. The return of rationality in the market will cause a rapid substantial recovery in stock prices in a very short time. The economy will then recover quickly.
The broader American market indices held yesterday supporting the double bottom. The recent stock market behavior could support a major advance if it continues upward this week.
Last night Asian markets were mixed but edged lower ranging from +0.6% to -0.9% with only the city of Shanghai down 3.9%.
At this moment most European markets are up about 1.8% on average.
The broader American indices are still holding above their November lows and the futures indicate a good start for today. There remains 30% to 40% headroom for this American market to rally before hitting substantial upside resistance level. However the 50-day moving average could be a new resistance level limiting the advance to about 15% until the Obama administration becomes rational.
The window for selling out of equities started closing January 20 and is almost shut now. The oversold market condition right now will hold the window open and a continued surge this week could crack the window open further and make continued holding of any equities worth while at least into this next rally. This week is critical. We would wait to sell into the next rally if the rally continues this week.
Administration irrationality caused and continues the crises
The oversold American stock markets rebounded from lows again yesterday and the futures are up significantly today indicating that the market will do better today. Ben Bernacke spoke intelligently like a capitalist yesterday causing the market to recover earlier losses and to go into positive territory.
President Obama later talked again in vapid generalities just like a well meaning empty headed socialist and subsequently drove the market back into negative territory as the market closed. The administration of "social activist czars" hasn't got a clue about what makes an economy grow. They seem preoccupied with acquiring more power not the needs of the American people. One of their most revealing quotes is, "Never waste a good crisis." They seem to enjoy creating crises and blaming it on others. They have witch hunts going on everywhere against Bush's war on terrorism, persecution of terrorists at the Cuban Club, against Christians for the socialist's definition of hate speech as anything spoken against immorality, and against radio show free speech for their criticism of socialism and totalitarian power grabs. They are against intelligent working Americans who object to taxation to pay for hoodlum Acorn political hacks, illegal aliens, and the slackers who want socialism and a free ride. The administration cut the FBI funds from the stimulation package to stop the investigation of political corruption.
Last year the Obama campaign ignored the fact that no responsible Americans have used the term "depression" since FDR said, "The only thing we have to fear is fear itself." Obama won the election at the price of creating the fear that caused the current crisis. This continued administration irrationality causes irrational fear depressing equities markets and the American economy. Unless Obama becomes rational he will cause another Great Depression out of the crisis he caused during his campaign.
Bernanke (from the Bush administration) said yesterday that stock market ignoring fundamentals.
Federal Reserve Chairman Ben Bernanke said on Wednesday that recent sharp declines in stock prices mostly reflected investor attitudes about risk and had become detached from real U.S. economic fundamentals.
"The stock values reflect not so much the fundamentals, the long-term profitability of the economy, but they also reflect investor attitudes about risk and uncertainty which right now are at very high levels."
Bernanke said that while the stock market was one of the important financial indicators, other key variables like credit markets were painting a different picture.
"It does reflect the profit expectations of a large number of firms, therefore it is closely tied to expectations about the economy," he said, referring to stocks.
Bernanke attributed the rapid and sharp decline in stock prices to investors being "skittish about holding any risky assets under the recent administration hints such as socialist nationalism and (who) have moved in a very substantial way toward the safest assets like Treasuries. Bernanke declared that the banks would not be nationalized.
Irrational fear of risk has depressed markets and prices. The administration ignorance of the relationship between the equities markets and the American economy is profound. The markets lead the economy by at least six months. The more the administration tries to destroy the stock market with socialist code words the more they endanger the American economy. The administration has to become rational before the markets will become rational. The return of rationality in the market will cause a rapid substantial recovery in stock prices in a very short time. The economy will then recover quickly.
The broader American market indices held yesterday supporting the double bottom. The recent stock market behavior could support a major advance if it continues upward this week.
Last night Asian markets were mixed but edged lower ranging from +0.6% to -0.9% with only the city of Shanghai down 3.9%.
At this moment most European markets are up about 1.8% on average.
The broader American indices are still holding above their November lows and the futures indicate a good start for today. There remains 30% to 40% headroom for this American market to rally before hitting substantial upside resistance level. However the 50-day moving average could be a new resistance level limiting the advance to about 15% until the Obama administration becomes rational.
The window for selling out of equities started closing January 20 and is almost shut now. The oversold market condition right now will hold the window open and a continued surge this week could crack the window open further and make continued holding of any equities worth while at least into this next rally. This week is critical. We would wait to sell into the next rally if the rally continues this week.
Administration irrationality caused and continues the crises
The oversold American stock markets rebounded from lows again yesterday and the futures are up significantly today indicating that the market will do better today. Ben Bernacke spoke intelligently like a capitalist yesterday causing the market to recover earlier losses and to go into positive territory.
President Obama later talked again in vapid generalities just like a well meaning empty headed socialist and subsequently drove the market back into negative territory as the market closed. The administration of "social activist czars" hasn't got a clue about what makes an economy grow. They seem preoccupied with acquiring more power not the needs of the American people. One of their most revealing quotes is, "Never waste a good crisis." They seem to enjoy creating crises and blaming it on others. They have witch hunts going on everywhere against Bush's war on terrorism, persecution of terrorists at the Cuban Club, against Christians for the socialist's definition of hate speech as anything spoken against immorality, and against radio show free speech for their criticism of socialism and totalitarian power grabs. They are against intelligent working Americans who object to taxation to pay for hoodlum Acorn political hacks, illegal aliens, and the slackers who want socialism and a free ride. The administration cut the FBI funds from the stimulation package to stop the investigation of political corruption.
Last year the Obama campaign ignored the fact that no responsible Americans have used the term "depression" since FDR said, "The only thing we have to fear is fear itself." Obama won the election at the price of creating the fear that caused the current crisis. This continued administration irrationality causes irrational fear depressing equities markets and the American economy. Unless Obama becomes rational he will cause another Great Depression out of the crisis he caused during his campaign.
Bernanke (from the Bush administration) said yesterday that stock market ignoring fundamentals.
Federal Reserve Chairman Ben Bernanke said on Wednesday that recent sharp declines in stock prices mostly reflected investor attitudes about risk and had become detached from real U.S. economic fundamentals.
"The stock values reflect not so much the fundamentals, the long-term profitability of the economy, but they also reflect investor attitudes about risk and uncertainty which right now are at very high levels."
Bernanke said that while the stock market was one of the important financial indicators, other key variables like credit markets were painting a different picture.
"It does reflect the profit expectations of a large number of firms, therefore it is closely tied to expectations about the economy," he said, referring to stocks.
Bernanke attributed the rapid and sharp decline in stock prices to investors being "skittish about holding any risky assets under the recent administration hints such as socialist nationalism and (who) have moved in a very substantial way toward the safest assets like Treasuries. Bernanke declared that the banks would not be nationalized.
Wednesday, February 25, 2009
This rally needs to grow legs this week
Market Outlook
The broader market indices held putting in what could be a double bottom. The recent stock market behavior could support a major advance if it continues upward this week. The oversold American stock markets rebounded yesterday and the futures were soaring minutes ago but they are dropping even faster now. It looks like more chaos ahead plus another Bernacke speech today. “It is often better to keep one’s mouth shut and appear to be a fool than to open it and remove all doubt.” But lately Bernacke is looking very good when compared with the Obama administration.
Last night Asian markets were up with China up 0.3%, India up 0.9% and Japan up 2.7%. Hong Kong was up 1.6%.
China actually bottomed November 4 at 2201 and is now up 30%. Hong Kong is today up 18% from its November Low. Evan Japan is up 17% from its November low. In contrast the broader American indices are at their November lows.
There is 30% to 40% headroom for this American market to rally before hitting substantial upside resistance level. However the 50 day moving average could be a new resistance level limiting the advance to 15%. Of course under democrat-socialism fundamentals there is no predictable market bottom.
As we have reported before in a virtual countdown… the window for selling out of equities started closing January 20 and is almost shut now. Only a continued surge this week would crack the window open further and make continued holding of any equities worth while according to our technical analysis. This week is critical.
At this moment most European markets are up about 1% on average. But socialist Europe is all down and still declining from November 2008 levels.
President Obama spoke:
The president’s message last night apparently informed the more informed Americans that Obama doesn’t really care about the American economy but he cares about his power base and government socialism.
1) He is going to double the number of windmills and solar panels instead of making America energy independent with nuclear power. His advisor Warren Buffet no longer thinks that makes any economic sense and Warren now himself recommends nuclear power. Obama is going to make America the producer of electric cars and electric batteries but Americans won’t be able to charge them until we have sufficient electric power. That requires nuclear power. That is his energy policy which will fail and make American automobile ownership too expensive and will encourage mass transit as in socialized Europe.
2) He is going to help strapped taxpayers subsidize college union teacher’s salaries by giving a tax credit to offset the cost of some of professor perks. The local school teacher’s unions will get their money directly through the state stimulation packages. That is his socialized education policy which will is designed to make states dependent on central government subsidies and eventually state control of education as in socialized Europe.
3) He is going to scrap American human experimental cancer research into new medicines and spend less money instead trying to first find a cure for cancer in laboratory rats. He is going to get rid of doctors who are specialists and have unionized general practitioners like they have under socialism in Europe. In France the local doctors publish the days they plan to be on strike each week so that it is not an inconvenience and so the French know not to get sick those days. That is his American dream version of the European socialized health plans.
To do all of this President Obama adds that he will save 1$Trillion by moving the war on terrorism back to American soil where he thinks it belongs and where it costs less money to fight. He has computed and plans to show in future budgets that the destruction of the twin towers in NYC (in just two hours) actually cost Americans less in dollars and slightly less in lives than fighting terrorists in their back yard in the Mid East (for the last 6 years). However, Obama seems to hate Wall Street somewhat less than the terrorists hate it. Little of this savings from bringing terrorism home to America will actually go to build our infrastructure but is instead designed to put money in the pockets of people who support Democrat-Socialism by giving supporters cash, administrative paper pushing jobs and task forces to work on.
The stimulation package is designed to tax the portion of the population that is willing to carry the water and to grow the portion of the American population that wants to just sit there and drink it. That is how Democrat-Socialists plan to win elections.
One thing is absolutely certain; in the future the people who work for a living will no longer be stupid enough to contribute to the campaigns of Democrat-Socialist so the socialist will have to add a new priority to their list namely,
Priority 3) Limit opposition campaign spending with a spending cap below what unions and government workers can support.
The others are:
1) Suppress religious freedom and moral judgment by defining it as “hate speech”
2) Curb free speech criticism by imposing a “fairness doctrine” to make it economically impossible to air free speech by forcing equal time for dull socialists who can't find anyone willing to listen.
The broader market indices held putting in what could be a double bottom. The recent stock market behavior could support a major advance if it continues upward this week. The oversold American stock markets rebounded yesterday and the futures were soaring minutes ago but they are dropping even faster now. It looks like more chaos ahead plus another Bernacke speech today. “It is often better to keep one’s mouth shut and appear to be a fool than to open it and remove all doubt.” But lately Bernacke is looking very good when compared with the Obama administration.
Last night Asian markets were up with China up 0.3%, India up 0.9% and Japan up 2.7%. Hong Kong was up 1.6%.
China actually bottomed November 4 at 2201 and is now up 30%. Hong Kong is today up 18% from its November Low. Evan Japan is up 17% from its November low. In contrast the broader American indices are at their November lows.
There is 30% to 40% headroom for this American market to rally before hitting substantial upside resistance level. However the 50 day moving average could be a new resistance level limiting the advance to 15%. Of course under democrat-socialism fundamentals there is no predictable market bottom.
As we have reported before in a virtual countdown… the window for selling out of equities started closing January 20 and is almost shut now. Only a continued surge this week would crack the window open further and make continued holding of any equities worth while according to our technical analysis. This week is critical.
At this moment most European markets are up about 1% on average. But socialist Europe is all down and still declining from November 2008 levels.
President Obama spoke:
The president’s message last night apparently informed the more informed Americans that Obama doesn’t really care about the American economy but he cares about his power base and government socialism.
1) He is going to double the number of windmills and solar panels instead of making America energy independent with nuclear power. His advisor Warren Buffet no longer thinks that makes any economic sense and Warren now himself recommends nuclear power. Obama is going to make America the producer of electric cars and electric batteries but Americans won’t be able to charge them until we have sufficient electric power. That requires nuclear power. That is his energy policy which will fail and make American automobile ownership too expensive and will encourage mass transit as in socialized Europe.
2) He is going to help strapped taxpayers subsidize college union teacher’s salaries by giving a tax credit to offset the cost of some of professor perks. The local school teacher’s unions will get their money directly through the state stimulation packages. That is his socialized education policy which will is designed to make states dependent on central government subsidies and eventually state control of education as in socialized Europe.
3) He is going to scrap American human experimental cancer research into new medicines and spend less money instead trying to first find a cure for cancer in laboratory rats. He is going to get rid of doctors who are specialists and have unionized general practitioners like they have under socialism in Europe. In France the local doctors publish the days they plan to be on strike each week so that it is not an inconvenience and so the French know not to get sick those days. That is his American dream version of the European socialized health plans.
To do all of this President Obama adds that he will save 1$Trillion by moving the war on terrorism back to American soil where he thinks it belongs and where it costs less money to fight. He has computed and plans to show in future budgets that the destruction of the twin towers in NYC (in just two hours) actually cost Americans less in dollars and slightly less in lives than fighting terrorists in their back yard in the Mid East (for the last 6 years). However, Obama seems to hate Wall Street somewhat less than the terrorists hate it. Little of this savings from bringing terrorism home to America will actually go to build our infrastructure but is instead designed to put money in the pockets of people who support Democrat-Socialism by giving supporters cash, administrative paper pushing jobs and task forces to work on.
The stimulation package is designed to tax the portion of the population that is willing to carry the water and to grow the portion of the American population that wants to just sit there and drink it. That is how Democrat-Socialists plan to win elections.
One thing is absolutely certain; in the future the people who work for a living will no longer be stupid enough to contribute to the campaigns of Democrat-Socialist so the socialist will have to add a new priority to their list namely,
Priority 3) Limit opposition campaign spending with a spending cap below what unions and government workers can support.
The others are:
1) Suppress religious freedom and moral judgment by defining it as “hate speech”
2) Curb free speech criticism by imposing a “fairness doctrine” to make it economically impossible to air free speech by forcing equal time for dull socialists who can't find anyone willing to listen.
Tuesday, February 24, 2009
Democrat-Socialism takes away incentive to work and achieves uniform distribution by making everyone poor.
Corrupt socialist politicians and their socialist friends in corporations are the only ones to profit initially from nationalization but eventually the corrupt Soviet Union demonstrated that even the corrupt politicians and their friends become poor though they remain dangerously powerful right to the end. We saw the money flowing from Soros and other socialist currency market manipulators and mortgage con artists into the coffers of the politicians at unprecedented rates last year.
The Democrat-Socialist petrified stock market is now so undervalued that the current prices have built in the worst possible socialist state. To go lower we need to visualize something like a Socialist Revolution or something completely insane that perhaps only corrupt Senators could conceive. But if their corrupt associates are in hedge funds shorting the market they could all be at extreme risk of the FBI.
Look now for the Socialists to become alarmed about FBI and other surveillance of theft and corruption. They are already alarmed with free speech on their socialist air waves. Yes the socialists think they own the air we breathe and the sound and radio waves that pass through it. They have defined hate speech in such a way that church pastors are afraid to preach about morality in California and other strong Democrat-Socialist states.
The lows of the broader market indices held again. The S&P yesterday was at its November low as was the NASDAQ. The S&P close was actually a fraction below its close on its November low.
The stock market behavior could support a major advance if it turns upward this week. The NYSE, S&P, NASDAQ, and QQQQ all barely held their November lows. This recent decline has low volume unlike during the November capitulation. The market will gain confidence late this year as the FBI removes the moral hazard from the world financial systems provided the Democrat-Socialists don’t outlaw investigations as too intrusive or prejudiced and hateful of the corrupt.
Market Outlook
Last night Asian markets were mixed with China down 4.5%, India down 0.2% and Japan down 1.5%. Hong Kong was down 2.9%.
China actually bottomed November 4 at 2201 and is now up 29%. Hong Kong is today up 16% from its November Low. Evan Japan is up 15% from its November low. In contrast the broader American indices are at the November lows.
At this moment most European markets are down about 1.6 % on average.
Socialist Germany is down 4.5% from its November 2008 low. Socialist France is likewise is showing no bottom.
The US market futures indicate a slightly positive opening this morning. There is 30% to 40% headroom for this market to rally before hitting an upside resistance level. Under democrat-socialism there is no predictable bottom.
As we have reported before in a virtual countdown… the window for selling out of equities started closing January 20 and is almost shut now. Only a surge this week would crack the window open further and make continued holding of any equities worth while according to our Re-spiral method that uses MACD and Parabolic SAR data.
Our cash flow index still says hold but says that on very little net cash flow. Our trend indicator seems to be peaking and may portend the end of the Obama honeymoon rally. This week is critical and will determine if the next leg is up again or down. The Democrat-Socialists have brought the stock market to its knees with American workers and retirees begging for some signs of mental activity, competency, and integrity.
The Democrat-Socialist petrified stock market is now so undervalued that the current prices have built in the worst possible socialist state. To go lower we need to visualize something like a Socialist Revolution or something completely insane that perhaps only corrupt Senators could conceive. But if their corrupt associates are in hedge funds shorting the market they could all be at extreme risk of the FBI.
Look now for the Socialists to become alarmed about FBI and other surveillance of theft and corruption. They are already alarmed with free speech on their socialist air waves. Yes the socialists think they own the air we breathe and the sound and radio waves that pass through it. They have defined hate speech in such a way that church pastors are afraid to preach about morality in California and other strong Democrat-Socialist states.
The lows of the broader market indices held again. The S&P yesterday was at its November low as was the NASDAQ. The S&P close was actually a fraction below its close on its November low.
The stock market behavior could support a major advance if it turns upward this week. The NYSE, S&P, NASDAQ, and QQQQ all barely held their November lows. This recent decline has low volume unlike during the November capitulation. The market will gain confidence late this year as the FBI removes the moral hazard from the world financial systems provided the Democrat-Socialists don’t outlaw investigations as too intrusive or prejudiced and hateful of the corrupt.
Market Outlook
Last night Asian markets were mixed with China down 4.5%, India down 0.2% and Japan down 1.5%. Hong Kong was down 2.9%.
China actually bottomed November 4 at 2201 and is now up 29%. Hong Kong is today up 16% from its November Low. Evan Japan is up 15% from its November low. In contrast the broader American indices are at the November lows.
At this moment most European markets are down about 1.6 % on average.
Socialist Germany is down 4.5% from its November 2008 low. Socialist France is likewise is showing no bottom.
The US market futures indicate a slightly positive opening this morning. There is 30% to 40% headroom for this market to rally before hitting an upside resistance level. Under democrat-socialism there is no predictable bottom.
As we have reported before in a virtual countdown… the window for selling out of equities started closing January 20 and is almost shut now. Only a surge this week would crack the window open further and make continued holding of any equities worth while according to our Re-spiral method that uses MACD and Parabolic SAR data.
Our cash flow index still says hold but says that on very little net cash flow. Our trend indicator seems to be peaking and may portend the end of the Obama honeymoon rally. This week is critical and will determine if the next leg is up again or down. The Democrat-Socialists have brought the stock market to its knees with American workers and retirees begging for some signs of mental activity, competency, and integrity.
Monday, February 23, 2009
Will the FBI take out the Senate Moral Hazards soon?
Perhaps not soon enough.
Senators Dodd and Rangel brought down the banks by shielding the mortgage fraud from investigation. Dodd took a cozy deal from Countrywide while Rangel has been accused of other real estate opportunism. Has the FBI put a tap on Senator Dodd so that they can find out why he is trying so hard now to destabilize the stock market? Again, he has been suggesting that a short period of nationalization could be needed. What does Dodd have to gain by spreading reckless rumors that imply US shares could be rendered worthless by incompetent, reckless, and no doubt corrupt government officials that perhaps have gone short against the future of America? Dodd seems to be doing everything in his power right now to bring down the American financial system.
Citi just retaliated by converting government cash investment infusions from preferred stock into common stock which means incompetent, reckless, and corrupt government officials will be red faced if they nationalize Citi because the government would lose value proportionately and thus the relative ownership of the common shareholders would be maintained. Therefore shareholders could be made whole again once the markets recover. It does not matter that the government could now vote their common stock because they are already dictating to the banks in spite of the fact their preferred shares gave them no voting rights. Converting the government held stock from preferred to common puts a limit on how much financial stocks could fall.
Seriously, the “Ab Scam” type investigations by the FBI of elected officials that cleaned out the morally hazardous politicians who were selling America down the river to Arab princes in the 1990’s is sorely needed again now. The stock market needs to see that the obscenely corrupt Senators are put away… not just the obscenely greedy corporate thieves. They worked together to set up the mortgage Ponzi scheme and just like Madoff… everyone could smell the corruption from the fact that no one could explain how it created any real value.
As we stated last week the performance of the blue chip DOW took a beating and hit new lows because the extreme fear of the financial talking heads in the media caused investors to shift into the Blue Chips last year. That resulted in the DOW being overvalued relative to the market as a whole. Consequently the Dow capitulation in November was not as low, and the current level of the DOW is now more consistent with the broader averages. Of course Russell got a DOW sell signal. But the fat lady has not yet sung. Bob Brinker said to get back into the market on dips starting on January 15, 2009. We have been recommending selling on advances since January 20, 2009 because that is when the market entered a whipsaw period where the market could end up going both south and north thus whipping investors. It is a dangerous market now even for traders. This is the critical week for our indicators when our selling window of opportunity could either close or could open further if the market advances.
The market is now so undervalued that the current prices have built in the worst possible depression. To go lower we need to visualize something like a revolution or something completely insane that perhaps only Senators Dodd and Rangel could conceive. But if their friends are in hedge funds shorting the market their friends could be at extreme risk (of prison) if the Senate moral hazards are driven out of office.
The lows of the broader market indices held again. The S&P closed 4% above its November low and the NASDAQ closed 10% above its November low.
The stock market behavior could support a major advance if it turns upward this week. The NYSE, S&P, NASDAQ, and QQQQ all held above their November lows. This current low has no volume like the November capitulation had. The market will gain confidence late this year as the moral hazard is dissembled and removed from the world financial systems.
China bottomed at the end of December and is now up 29%. Last night Asian markets were mixed with China up 2%, India down 2.2% and Japan down 0.5%. Hong Kong was up 3.8%.
At this moment most European markets are up about 0.8 % on average.
The US market futures indicate a slightly positive opening this morning. There is 30% to 40% headroom for this market to rally before hitting an upside resistance level. We could sure use a short squeeze right now.
Senators Dodd and Rangel brought down the banks by shielding the mortgage fraud from investigation. Dodd took a cozy deal from Countrywide while Rangel has been accused of other real estate opportunism. Has the FBI put a tap on Senator Dodd so that they can find out why he is trying so hard now to destabilize the stock market? Again, he has been suggesting that a short period of nationalization could be needed. What does Dodd have to gain by spreading reckless rumors that imply US shares could be rendered worthless by incompetent, reckless, and no doubt corrupt government officials that perhaps have gone short against the future of America? Dodd seems to be doing everything in his power right now to bring down the American financial system.
Citi just retaliated by converting government cash investment infusions from preferred stock into common stock which means incompetent, reckless, and corrupt government officials will be red faced if they nationalize Citi because the government would lose value proportionately and thus the relative ownership of the common shareholders would be maintained. Therefore shareholders could be made whole again once the markets recover. It does not matter that the government could now vote their common stock because they are already dictating to the banks in spite of the fact their preferred shares gave them no voting rights. Converting the government held stock from preferred to common puts a limit on how much financial stocks could fall.
Seriously, the “Ab Scam” type investigations by the FBI of elected officials that cleaned out the morally hazardous politicians who were selling America down the river to Arab princes in the 1990’s is sorely needed again now. The stock market needs to see that the obscenely corrupt Senators are put away… not just the obscenely greedy corporate thieves. They worked together to set up the mortgage Ponzi scheme and just like Madoff… everyone could smell the corruption from the fact that no one could explain how it created any real value.
As we stated last week the performance of the blue chip DOW took a beating and hit new lows because the extreme fear of the financial talking heads in the media caused investors to shift into the Blue Chips last year. That resulted in the DOW being overvalued relative to the market as a whole. Consequently the Dow capitulation in November was not as low, and the current level of the DOW is now more consistent with the broader averages. Of course Russell got a DOW sell signal. But the fat lady has not yet sung. Bob Brinker said to get back into the market on dips starting on January 15, 2009. We have been recommending selling on advances since January 20, 2009 because that is when the market entered a whipsaw period where the market could end up going both south and north thus whipping investors. It is a dangerous market now even for traders. This is the critical week for our indicators when our selling window of opportunity could either close or could open further if the market advances.
The market is now so undervalued that the current prices have built in the worst possible depression. To go lower we need to visualize something like a revolution or something completely insane that perhaps only Senators Dodd and Rangel could conceive. But if their friends are in hedge funds shorting the market their friends could be at extreme risk (of prison) if the Senate moral hazards are driven out of office.
The lows of the broader market indices held again. The S&P closed 4% above its November low and the NASDAQ closed 10% above its November low.
The stock market behavior could support a major advance if it turns upward this week. The NYSE, S&P, NASDAQ, and QQQQ all held above their November lows. This current low has no volume like the November capitulation had. The market will gain confidence late this year as the moral hazard is dissembled and removed from the world financial systems.
China bottomed at the end of December and is now up 29%. Last night Asian markets were mixed with China up 2%, India down 2.2% and Japan down 0.5%. Hong Kong was up 3.8%.
At this moment most European markets are up about 0.8 % on average.
The US market futures indicate a slightly positive opening this morning. There is 30% to 40% headroom for this market to rally before hitting an upside resistance level. We could sure use a short squeeze right now.
Friday, February 20, 2009
A full market recovery is now possible as the FBI dissembles the financial moral hazard
The lows of the broader market indices held again. The S&P closed 5% above its November low and the NASDAQ closed 11% above its November low. The moral hazard is about to be punished by the FBI.
The stock market behavior appears set to support a major advance not just another bounce. The NYSE, S&P, NASDAQ, and QQQQ all held above their November lows. The market will gain confidence as the moral hazard is dissembled and removed from the world financial system.
The DJI's low in November was not a full capitulation because investors were fleeing to the Blue Chip stocks under the mistaken belief that they represented quality. Jim Cramer, the Money crowd, and others were pushing favorite portfolio picks from the Blue Chips then. But more recently investors discovered that the dumbest and most corrupt executives were in the big trusted companies reaping the obscene bonuses like Bernie Madoff and Allen Stanford.
In fact the whole Financial Crisis is the consequence of a Subprime Mortgage Ponzi Scheme that required the debt demand of people who wanted to buy a house. The corrupt mortgage lenders had to gradually drop borrower acceptance standards because they could not get enough mortgages to fill the demand for the high interest junk mortgage derivatives that the banks were selling. Ultimately some investors, Goldman Sachs, and hedge fund managers suspected that it was a fraud and began betting against the Ponzi scheme.
We have finally reached the stage when that moral hazard is about to be taken down by the FBI. The FBI says more than 500 companies were involved. This purge and punishment stage is necessary for confidence to be restored to banks and the world financial system. This punishment of the morally obscene and stupid executives who caused the crisis and thought Americans were dumb enough (like G. "W" Bush) to not go after them… is the final requirement for a full market recovery.
China bottomed at the end of December and is now up 27%. Last night Asian markets were mixed with China up 1.6%, India down 2.2% and Japan down 1.9%.
At this moment most European markets are down about 3 % on average.
The US market futures indicate a negative opening this morning but still only the DJI is below the November low at the opening for the reason we explained above… that people in November fled to the DJI on the mistaken belief they were of better quality. Yesterday the S&P closed 5% above its November low and the NASDAQ closed 11% above its November low.
Options expirations will help the market that is ready to advance after several successful tests of the market's recent lows. There is 30% to 40% headroom for this market to rally before hitting an upside resistance level.
The stock market behavior appears set to support a major advance not just another bounce. The NYSE, S&P, NASDAQ, and QQQQ all held above their November lows. The market will gain confidence as the moral hazard is dissembled and removed from the world financial system.
The DJI's low in November was not a full capitulation because investors were fleeing to the Blue Chip stocks under the mistaken belief that they represented quality. Jim Cramer, the Money crowd, and others were pushing favorite portfolio picks from the Blue Chips then. But more recently investors discovered that the dumbest and most corrupt executives were in the big trusted companies reaping the obscene bonuses like Bernie Madoff and Allen Stanford.
In fact the whole Financial Crisis is the consequence of a Subprime Mortgage Ponzi Scheme that required the debt demand of people who wanted to buy a house. The corrupt mortgage lenders had to gradually drop borrower acceptance standards because they could not get enough mortgages to fill the demand for the high interest junk mortgage derivatives that the banks were selling. Ultimately some investors, Goldman Sachs, and hedge fund managers suspected that it was a fraud and began betting against the Ponzi scheme.
We have finally reached the stage when that moral hazard is about to be taken down by the FBI. The FBI says more than 500 companies were involved. This purge and punishment stage is necessary for confidence to be restored to banks and the world financial system. This punishment of the morally obscene and stupid executives who caused the crisis and thought Americans were dumb enough (like G. "W" Bush) to not go after them… is the final requirement for a full market recovery.
China bottomed at the end of December and is now up 27%. Last night Asian markets were mixed with China up 1.6%, India down 2.2% and Japan down 1.9%.
At this moment most European markets are down about 3 % on average.
The US market futures indicate a negative opening this morning but still only the DJI is below the November low at the opening for the reason we explained above… that people in November fled to the DJI on the mistaken belief they were of better quality. Yesterday the S&P closed 5% above its November low and the NASDAQ closed 11% above its November low.
Options expirations will help the market that is ready to advance after several successful tests of the market's recent lows. There is 30% to 40% headroom for this market to rally before hitting an upside resistance level.
Thursday, February 19, 2009
The stock market behavior appears set to support a major advance not just another bounce.
Yet the fear gauge, VIX, remains at 48… a high level which prior to 2008 only occurred during short intervals of panic! People are highly hedged and under those conditions the people selling PUTs have a great interest now in reducing volatility, not fear. Cash flow has been low and slightly negative which is not bad. But when the market hovers so close to bottom resistance levels it is at risk of setting off panic selling. The stock market would normally rise during the next two days as options expire this week and the people selling the puts buy shares so the PUTs expire worthless. People who like to channel stocks would say this is the best time to buy into this market.
According to our Re-spiral indicator the market now has less than two weeks left to start a rally or we would normally liquidate our stock holdings in anticipation of another downward leg. The administration yesterday predicted that unemployment would still be under 9% at the end of the year but there would be some contraction in the economy. They have so exaggerated the fall off in retail sales with their -2% per month talk that now their predicted 2% year wide contraction sounds like an improvement. President Reagan saw unemployment peak at 12% after Jimmy Carter's "malaise" and stagflation. Most economists are still predicting the economy will turn around before this year ends.
Bob Brinker said, "We expect calendar year 2009 to be a significant positive year for the stock market."
China bottomed at the end of December and is now up 26%. Last night Asian markets were up with China up 0.8%, India up 0.3% and Japan up 0.3%. Hong Kong was up 0.1%.
At this moment most European markets are flat, up about 0.1% on average.
The US market futures indicate a positive opening this morning. Options expirations will help the market that is ready to surge after several successful tests of the market's recent lows. There is 30% to 40% headroom for this market to rally before hitting an upside resistance level.
According to our Re-spiral indicator the market now has less than two weeks left to start a rally or we would normally liquidate our stock holdings in anticipation of another downward leg. The administration yesterday predicted that unemployment would still be under 9% at the end of the year but there would be some contraction in the economy. They have so exaggerated the fall off in retail sales with their -2% per month talk that now their predicted 2% year wide contraction sounds like an improvement. President Reagan saw unemployment peak at 12% after Jimmy Carter's "malaise" and stagflation. Most economists are still predicting the economy will turn around before this year ends.
Bob Brinker said, "We expect calendar year 2009 to be a significant positive year for the stock market."
China bottomed at the end of December and is now up 26%. Last night Asian markets were up with China up 0.8%, India up 0.3% and Japan up 0.3%. Hong Kong was up 0.1%.
At this moment most European markets are flat, up about 0.1% on average.
The US market futures indicate a positive opening this morning. Options expirations will help the market that is ready to surge after several successful tests of the market's recent lows. There is 30% to 40% headroom for this market to rally before hitting an upside resistance level.
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