Monday, July 7, 2014

July 5 Things will not get better until the number of people joining the labor force is greater than the number joining the unemployment line. Only 264K joined the labor force while 315K signed up for unemployment this week and this incompetent administration and some stock market shysters declared this to be another sign of recovery.


World Economy

July 5   Things are stable in Greece and Turkey but are now shaky in Israel, Syria, Lebanon, Iraq, Iran, and Afghanistan. 

Qatar is now the world capital for identity theft of senior citizens in America.  They now have merchants in America who first prey on senior Americans and then go out of business so they cannot be traced.  Then they call the seniors they cheated and claim they discovered that these wonderful seniors have been mistreated and the mother company wants to refund their money, say $300.  But they need some information.  Once the senior is hooked they launder some money (say 2000) through the senior’s bank account and ask the senior to return the $1700 that was not the senior’s money.  They make up any story the senior is willing to believe such as their bank could not make transactions less than $2000 but would they please FEDEX the $1700 they owe back to Qatar.  The senior is now $300 ahead and thinks the thieves are honest.  Next they say they have clients who would like US dollars and offer the same exchange where for every $2000 the senior accepts he can keep $300 but the criminals need a little more information for security purposes.  This looks like a good deal because the senior will make $300 every time they transfer $1700 back by Fedex.   (The ammounts can vary). By now the thieves have enough information to hack in and gradually transfer all the senior’s money to Qatar and close out the thieves Qatar accounts so they cannot be traced.  The Qatar government may even be aware this is happening. 
This happened to seniors we know and we called them and they could not believe it was identity theft so then we called their daughter and she took them to the bank the next morning and in three days the thieves had stolen their identity and already transferred $6000 out of their accounts directly to Qatar.  The bank then changed their account numbers and issued a warning to all their other clients.  It was a $6000 lesson in addition to be wary of local merchants who know very little English.  They were first overbilled and gave the foreigner access to all the names addresses and accounts on their computer.

  Remove all files that contain identity information before taking your computer to a computer repair store... or at minimum only keep coded acct names and passwords in a form leaving out certain numbers and letters that you always can remember eg.  parts of old telephone numbers joined with short names.  Keep a complete written list hidden at home for backup.  Computer store personnel are usually honest but they tend to be expert hackers just so they can get into and clean up a computer.  Go American.  If they can’t speak English correctly, that cannot be a sign of trouble.

 

The European FTSE is at the highs of 2000 and 2007 but MSNBC/PRAVDA is still saying buy-by-by.


 

If you look at Germany where the people have perhaps the strongest work ethic in the world, their stock market has topped out too but their trend is upward only because the dollar is continually weakening.


 

The French market is about 60% of what it was fourteen years ago. At it most recent highs it is still is still down 50% from 2008 and down 60% from 2000.

http://in.finance.yahoo.com/q/bc?s=%5EFCHI&t=my&l=on&z=l&q=l&c=

 

Japan’s stock market appears to have topped and begun a new decline. It has declined since 1990 when it began Quantitative Easing because their Yen is dropping faster than the dollar.


 

The Swiss market still indicates stagnation since 2007. It has hit the highs of 2003 but could not make it to the highs of 2007. Obama has destroyed Swiss banking by attacking Swiss confidentiality that had protected people from the Hitlers and Stalins of the past.

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

 

American Economy

Jun 30

Chicago PMI Jun 62.6 down from 65.5 --

Pending Home Sales May 6.1% up from 0.4% +++

Jul 1

ISM Index Jun 55.3 down from 55.4 -

Construction Spending May 0.1% down from 0.8% ---

Jul 2

MBA Mortgage Index 06/28 -0.2% down again -1.0% --

Factory Orders May -0.5% down sharply from 0.8% ---

Jul 3

Challenger Job Cuts Jun -20.2% sharply lower 45.5% + outlier

Nonfarm Payrolls Jun 288K up from 224K - outlier plus government expansion

Nonfarm Private Payrolls Jun 262K up from 224K ++ but initial claims was 315K

264K joined the labor force and 315K signed up for unemployment. 

Unemployment Rate Jun 6.1% meaningless vs. 6.3% -

Due to drop in weeks unemployment compensation from 99 to 52

Hourly Earnings Jun 0.2% flat 0.2% -

Average Workweek Jun 34.5 flat 34.5 -

Initial Claims 06/28 315K flat from 313K --- Also exceeds payroll growth

Continuing Claims 06/21 2579K increased 2571K ---

Trade Balance May -$44.4B deficit down slightly -$47.2B

ISM Services Jun 56.0 got worse from 56.3 --

 

The Markets

They are still in the stratosphere with QE still stimulating at $35Billion time a factor of 20 times higher leverage per month.  But that is first going to drop to zero they say this year.  And then they say it will sit there for a while and slowly go negative draining money out of the markets at a leveraged rate 20 times higher.   It is not possible to predict a market top when the government is throwing money at the economy and it is all going into financial markets that pay almost nothing and are inflated.  But it is unsound to buy at market highs when the economies are in the hands of incompetent people who throw money at every problem and accomplish nothing in the end.  The left wing keeps throwing money at teacher’s unions for pensions in order to get campaign contributions but our children have dropped from being #1 in the world in 1963 and we ranked only  #27 in 2013.

 

World trade is now down 60% for the year to date and at a 15 year low.  It is down 84% since 2007 before Obama.  Look at the last 1+ years of world trade! Use the graph or snapshot option. Unfortunately they do not show back to 2008 when world trade was more than five times higher than it is today.


 

 Look at the volatility index and you see that the market could fall much faster. This market has little volume or volatility.  So when volume picks up past history says the market will plunge.  This is not a good moment in time for holding equities.


 

 World market updates:

http://finance.yahoo.com/intlindices?e=europe

http://finance.yahoo.com/intlindices?e=asia http://in.finance.yahoo.com/intlindices?e=asia
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