Tuesday, August 5, 2014

August 8 John Ortberg says, “To an adult, it’s ironic when a two-year-old says, “Mine.” Adults know that two-year-olds don’t earn any of their stuff. It is all provided for them. It is a gift from someone much larger and wiser than they. Nevertheless, two-year-olds get extremely attached to their stuff. If someone tries to take something, that item suddenly becomes their favorite stuff. Two-year-olds can be so deluded, can’t they?”

So Obama has allowed well meaning fools to bring the Ebola virus to America too!  Obama can’t even keep track of our 10 million illegal immigrants, so how will he keep track of the Ebola virus?  Two off duty border agents were just shot and one was killed by former Obama deported Mexican criminals because Obama refuses to secure America’s borders or throw the criminals in jail.
http://www.breitbart.com/Breitbart-Texas/2014/08/06/Illegal-Aliens-Tied-to-Border-Patrol-Agent-Shooting-Had-Been-Deported-Several-Times
 
Obama is doing for America what Putin is doing for Russia.  Socialism is equality of poverty and we are about to get a big dose of it.  Fortunes are at 2007 bubble levels just before the liar-loan collapse.  This collapse will likely be an ETF market and Hedge Fund market collapse.  Real shares of stock are not traded any more for many funds.  We have no idea now what real shares of stock are worth on the ledgers of hedge funds and funds that manufacture sector average funds, volatility funds, and other derivatives.  Banks for the most part manufacture those derivative funds.  Goldman Sacks and others will come under tremendous investigation pressure if there is a melt down.  The Obama/Frank liar loan mortgage scandal that broke in 2007 was caused by Federal pressure on realtors and banks to make home mortgages available to people who could not afford them.
 
The new Common Core, CC, American public school curriculum is under fire now because it continues to lower American standards.  America was #1 in 1963 and is now #26 in world in terms of high school student competency.  When these CC students graduate they will have to take special courses to catch up in both science and math because math is at the core of science.  That means the USA is losing the technology race fast and that has been the key to American prosperity. 
 
Aug 5  These crucified men were former Muslims that had converted to Christianity, Illinois Review reports. Each of the 8 men was charged with the crime of apostasy for renouncing Islam and converting to Christianity. When confronted by the ISIS members, they refused to “revert” to Islam.  This is the “only” reason they were crucified. According to Islamic jurisprudence, crucifixion is a method of death reserved for Christians.
 
A ramp up in illegal immigration, the decline in the economy, and the decline of liberty and free enterprise have all occurred in the last six years.  We can’t blame Congress because they were there for over 200 years.  Only Obama and his incompetent and corrupt staff correlate with all the American economic and international disasters.
 
A new study from researchers at the University of Hong Kong and Indiana University estimates that corruption on the state level is costing Americans in the 10 most corrupt states an average of 5.2% of those states’ average expenditures per year.  The ten most corrupt states are: Mississippi, Louisiana, Tennessee, Illinois, Pennsylvania, Alabama, Alaska, South Dakota, Kentucky, and Florida.  The study also found the least corrupt states are Oregon, Washington, Minnesota, Nebraska, Iowa, Vermont, Utah, New Hampshire, Colorado, and Kansas.
 
World Economy
The world of Obama’s America now resembles Aldous Huxley’s book 1984.  It is a world of continuous wars with “Big Brother” watching everyone through the TV screens.  Who would have guessed that indeed today it is a reality that “Big Brother” can see us through our computer and cell phone screens and even has our precise GPS location.  Russians watch and cheer as Putin sends troops to occupy Belarus and Crimea and shoots down a jet airliner killing 295 adults and three babies.  One baby was found still in one piece.  Putin, still a communist, now has 20,000 communist soldiers on the border ready to invade the Ukraine.
 
Aug 5  Despite over 200 years of African infrastructure projects backed by foreign donors, Accra Ghana, still doesn’t have a working sewer system, leaving most of its citizens to choose between communal latrines or defecating on the streets. That’s contaminating the city’s groundwater, according to the World Bank, and almost 700 people have contracted cholera in Accra since June.  That is almost as many as this year's Ebola deaths.  The failure to maintain existing treatment plants has rendered them unusable, while a lack of political will means there’s little prospect of any immediate improvement.   U.S. manufacturers like General Electric Co. and Ford Motor Co. see Africa emerging as the world’s next big growth market and are rushing to expand there.  It sounds like GE and Ford are headed towards big problems and someone ought to tell them about the Ebola epidemic!  This past week Obama launched his big investment effort comparing Africa to Russia, China, and Brazil.  Obama will start with investments in several  $30 million hotels for all the American workers who will go to Africa to work.  He did that for Haiti too except Obama did not build roads to the Hotels so they stand vacant in Haiti’s hills.
http://www.bloomberg.com/news/
 
The European FTSE is at the highs of 2000 and 2007 but MSNBC/PRAVDA is still saying buy and 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.
 
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 French market is only 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=
 
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
We will no longer list Obama economic statistics that are clearly unbelievably wrong or intentionally corrupted.  It is hard to say whether China’s or Obama’s statistics are more correct.
Aug 5
Factory Orders Jun 1.1% data scatter again -0.5%
ISM Services Jul 58.7 increasing 56.0  ++
Aug 6
Trade Balance Jun -$41.5B not as bad as -$44.4B
Aug 7
 8:30 AM Initial Claims 08/02 289K flat 302K
Consumer Credit Jun $17.3B down from $19.6B -
Aug 8
Unit Labor Costs Q2 0.6% not believable 5.7%
Wholesale Inventories Jun 0.3% 0 0.3%
 
The Markets
Aug 8   Volume being so low during the market advance means the cash supporting the market rise has been less than half the support from 2001 to 2007.  From 2001 to 2007 the share volume doubled as the market rose.  From 2009 to 2014 the share volume dropped 50% as the market rose.   Mathematically if we buy 1000 shares and the price of the stock rises $1 it means we paid $1 times 1000 or $1000 more than the stock was worth on the previous trade.  It takes twice as much extra cash to move the stock $1 if we double the volume as in 2001-2007 vs 2009-2014.  Therefore the market rise this time has less than 50% the strength it had 2001-2004.  It would be 50% of the strength if volume was always 50% lower but the volume was now has dropped as the market rose and the last time the volume rose as the market rose.  So this market is in the stratosphere now with less underlying support than it had in 2007.  That is because people got out and bought bonds instead.  Every time Bernanke dropped bond interest rates bond prices rose by the same percent.  Dropping rates from 4% to 2% means a bond doubles in value.  Dropping from 2% to 1% caused bonds to double again.  So stocks are overvalued and bonds are overvalued and will collapse 50% when the 1% rate goes to 2%.  Therefore when interest rates begin to rise both stocks and bonds will collapse in value.  Interest rates are as low as they can go without causing hyperinflation.  If the FED causes hyperinflation history shows that is always followed by a great depression.  Extremely low interest rates and half the normal volume are both harbingers of a looming financial crisis.  In the past the FED has never allowed the dollar in money markets to be broken below 1.0.  The FED is warning that even money market securities could lose face value in the next financial crisis.  Usually the stock market has to slide about a year for the crisis to hit banks and insolvencies to go virulent. 
 
Aug 6 The real worry will come when brokers lose their reputation for safety because funds deposited with brokers do not have the guarantees banks have.  We are optimistic that America can survive the damage Obama has done.  It is increasingly evident that the FED cannot keep America out of a depression without some hyperinflation first to overcome the damage done by Quantitative Easing.  Japan has been a prisoner of QE since 1990 and their values have fallen since then relative to the dollar and China has replaced Japan as the second greatest economy.  At one time Japan owned six of the world’s ten largest banks.
 
Aug 5  As the market bubble expands the waste increases… but is hidden.  When the market declines the waste is exposed and written off.  The damage and corruption occurs during the bubble for as long as the bubble lasts. 
 
Now the volatility index below is starting to rise.
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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